human RESOURCE AUDIT need, objectives ppt
- 1. C HUMAN RESOURCE AUDIT Presented by : Pundi pandu Jhansi
- 2. WHAT IS AUDIT The general definition of an audit is an evaluation of a person, organization, system, process, enterprise, project or product. The term most commonly refers to audits in accounting, but similar concepts also exist in project management, quality management, water management.
- 3. HUMAN RESOURCE AUDIT HR audit refers to an examination and evaluation of policies, procedures and practices to determine the effectiveness of personnel management. It is a periodic review to measure the effectiveness of personnel management and to determine the steps required for more effective use of human resources. It involves a formal, systematic and in-depth analysis, investigation and comparison
- 4. DEFINITION: • Human Resource Audit is a systematic assessment of the strengths, limitations, and developmental needs of its existing human resources in the context of organizational performance – (Flamholtz, 1987)
- 5. objectives • To review the organizational system, HR subsystem in order to find out the efficiency of the organization in attracting and retaining human resources. • To find out the effectiveness of various personnel policies and practices. • To know how various units are functioning and how they have been able to implement the personnel policies. • To identify shortcomings in the management of human resources. • To evaluate the personnel staff
- 6. Need for HR AUDIT • The number of employees • Organisational structures • Communication and feedback • Location and dispensing • Status of an industrial relations manager • Administrative style
- 7. Scope of HR AUDIT • Audit of Corporate Strategy Corporate Strategy concerns how the organization is going to gain competitive advantage. • Audit of the Human Resource Function Audit touches on Human Resource Information System, Staffing and Development, and Organization Control and Evaluation. • Audit of Managerial Compliance Reviews how well managers comply with human resource policies and procedures. • Audit of Employee Satisfaction To learn how well employee needs are met.
- 8. AREAS OF HR AUDIT • Mission statement relating to HR management • Objectives ,goals and strategies of HR management • Accomplishment of HR management • Programmes of HRM including the detailed practices and procedure • HRM policies • Role of HRM in TQM
- 9. Nature of HRM Audits HRM Objectives Organizational HRM activities objectives HR OBJECTIVES HR ACTIVITES HR OUTCOMES HR AUDIT ORGANISATIONAL OBJECTIVES
- 10. Benefits of HR AUDIT • Identifies the contribution of the personnel departments to the organization • Improves professional image of the personnel department • Encourages greater responsibility and professionalism among members of the personnel department • Clarifies the personnel department’s duties and responsibilities • Finds critical personnel problems
- 11. Methods of HR AUDIT • INDIVIDUAL INTERVIEW METHOD • GROUP INTERVIEW METHOD • WORKSHOP METHOD • QUESTIONNAIRE METHOD • OBSERVATION • ANALYSIS OF SECONDARY DATA • ANALYSIS OF REPORTS, RECORDS, MANUALS AND OTHER PUBLISHED LITERATURE
- 12. HR AUDIT approaches Approaches to Human Resources Audit Prof. K. Aswathappa has identified the following approaches, which are adopted for purpose of evaluation: • Comparative approach • Outside authority approach • Statistical approach • Compliance approach • Management by objectives (MBO) approach
- 13. Comparative approach • In this approach, another division or company that has better practices or results is chosen as the model. The audit team audits and compares the audited firm’s results with the best practices of the model organization. This approach is commonly used to compare the results of specific activities or programs. The approach is often used with turnover, absence, salary data and staffing levels. It helps detect areas where improvement is needed. It also makes sense to compare where a procedure is being used for the first time
- 14. Outside authority approach • In this approach, standards set by a consultant or taken from published research findings serve as the benchmark for the audit team. The consultant or research findings may help diagnose the cause of problems. It is also known as external approach
- 15. Statistical approach • This approach relies on performance measures drawn from the company’s existing information system. From existing records, the audit team generates statistical standards against which activities and programs are evaluated. With the mathematical standards as a base, the team may uncover errors while they are still minor. Often this approach is supplemented with comparative data from external sources such as other firms, or industry association surveys. The information is usually expressed in ratios or formulas that are easy to compute and use
- 16. Compliance approach • This approach reviews past practices, to determine if actions taken followed legal requirements and company policies and procedures. The audit team here often examines a sample of employment, compensation, discipline and employee appraisal forms. The purpose of the review is to ensure that the field offices and the operating managers have complied with internal rules and legal regulations, such as minimum wages and equal employment opportunity laws. By sampling elements of the human resources information system, the audit team looks for deviations from laws and company policies and procedures. The team can then determine the degree of compliance achieved.
- 17. Management by Objectives (MBO) • In this management by objectives approach, managers and specialists set objectives in their area of responsibility. Then they create specific goals against which this performance can be measured. The audit team researches actual performance and compares it with the previously set objectives. They can then evaluate the trends in this area.
- 18. Steps in conducting HR AUDIT DEFINIG THE SCOPE OF AUDIT CHOOSING THE RESEARCH APPROACH SELECTING RESEARCH DESIGN AND DATA COLLECTION METHOD ANALYZING DATA, EVALUATING AND PREPARING REPORT