hrd audit

HRD Audit…. A basic introduction

What ?...

An HRD Audit is like an annual health check-up, it plays a vital role in instilling a sense of confidence in the Management and the HR functions of an organisation.

What is HRD ?• HRD is any process or activity that, either

initially or over the longer-term, has the potential to develop adults work-based knowledge, expertise, productivity, & satisfaction, whether for personal or group/team gains or for the benefit of an organization, community nation or ultimately the whole human beings.

• Competence Building

• Commitment /Motivation Building

• Culture Building- Mclean & Mclean

What is HRD Audit?...

HRD Audit is a comprehensive evaluation of the existing HRD

Structure, Strategies, Systems, Styles, Skills / Competencies & Culture

and their appropriateness to achieve the short-term and long-term goals of the organisation.

What is involved in Good HRD?

•Top Management Philosophy and Understanding

•Competent HR Staff and Department•Line Manager Attitudes•Union and Employee Support•Use of appropriate Systems•Periodic Renewal Exercises•Business relevance of HRD systems and

Practices

Why ?...

Organisations undertake HR audits for many reasons :• To make the HR function business-driven.• Change of leadership.• To take stock of things & to improve HRD for expanding, diversifying, & entering

into a fast growth phase.• For growth & diversification.• For promoting professionalism among employees & to switch over to professional

Management.• To find out the reasons for low productivity & improve HRD strategies.• Dissatisfaction with a particular component.• To become employer of choice. For expanding, diversifying and entering into a

fast growth phase. • For promoting more professionalism and professional management.• Bench-marking for improving HRD practices.• Growth and diversification• Dissatisfaction with any component• Change of leadership

Concept…….•HRD Audit is comprehensive.

Where does the company wants to be 10 years from now, 3yrs from now and 1 year from now?(HRD business linkage score)

What is the current skill base of employees in the company in relation to the various roles and role requirements?(competency score)

What are the HRD sub systems available today to help the organisation build its competency base for the present immediate ,future and long term goals?(HRD systems maturity score)

What is the current level of effectiveness of these systems in developing peopleand ensuring that human competencies are available in adequate level in the company?(HRD systems maturity score)

Is the HRD structure existing in the company adequate enough to manage the HRD in the company?(HRD competencies score)

Are the top management and senior managers styles of managing people in tune with the learning culture?(HRD culture score)

Concept cond….

•HRD Audit examines linkages with other systems.

Total quality management. Personnel policies Strategic planning.

•HRD audit is business driven.

Methodology of HRD Audit

•Examines long term and short term plans and vision to assess Competency Requirements

•Identifies broad Competency requirements for future Business Goals

•Examines the existing HRD strategies, systems and practices and assess their appropriateness to have the required competencies

Methodology of HRD Audit

•Examines the adequacies and inadequacies of HRD structure, staff and their competencies, line managers and their attitudes, top management and their support, unions and their role in competence building for future

•Suggests mechanisms for improving all these in the business context

Methodology Adopted

•Interviews▫Individual and group▫Top Management▫Line Managers▫HRD Staff▫Workmen and others

•Questionnaires•Observation•Analysis of records and secondary data

Methodology

•Workshops could be used•Task forces and internal teams could also

be used•External Auditors have a significant role•Benchmarking of questionnaire data may

be of use

What does a full HR Audit entail ?• Legal compliance• Compensation/Salary

Administration• Employment/Recruiting• Orientation• Terminations• Training and Development

• Employee Relations• Files/Record

Maintenance/Technology• Policies and procedures (including

employee handbook)

Pillars of HRD audit,measuring effectiveness……•HRD systems maturity.•HRD competencies.•HRD culture.•Business linkages of HRD.

HRD Score Card…

This model is based on the assumption that:

Competent and committed employees are needed to provide quality products & services at competitive rates & ways that enhance customer satisfaction.

HRD Score Card…

Name of the Organisation

HRD System Maturity Grade

HRD Competence Score

HRD Competence Score

Business Linkage Grade

Overall HRD Maturity rating

B* C B* B B*CB*B

Assesment ratings….• A* -highest score and highest maturity

level.• A - very high maturity level.• B* -high maturity level.• B -moderately high maturity level.• C* -moderate maturity level.• C -moderately low maturity level.• D* -low maturity level.• D -very low maturity level.• F -not at all present.• U - ungraded.

Parameters to be audited…1. HRD Systems Maturity…The HRD systems maturity assesses the

extent to which various HRD subsystems and tools are well designed & are being implemented.

The systems should be appropriate and relevant to business goals.

It should focus on current and future needs of the corporation.

The HRD strategies and systems should flow from the corporate strategies.

The systems should be well designed and should have a structural maturity.

They should be implemented well. The employees should be taking them seriously implemented well. The employees should be taking them seriously and follow

meticulously what has been envisaged in each system. The overheads of implementation should be low.

The subsystems should be well integrated and should have internal synergy.

They should be adequate and should take care of the HRD requirements of the organisation.

HRD Systems Maturity…

• The following subsystems are assessed and depending upon the extent to which they meet the requirements a score is assigned.

Manpower planning and recruitment Performance Management Systems Feedback and Coaching Mechanisms Training Career development and Succession planning

HRD Systems Maturity…Job-rotation OD Interventions HR Information systems Worker Development methods and systems HR Information Systems Potential Appraisal and DevelopmentOther subsystems if any

HRD Competencies in the Organization…

This dimension indicates the extent to which HRD competencies are well developed in the organisation.

The HRD Staff

The Top Management

Line managers and Supervisory Staff

Union and Association leaders

Workmen, Operators and Grass root level employees

HRD Competencies in the Organization…

• Each of the groups is assessed on :

The level of HRD skills they possess

Their attitudes and support to learning and their own development

Extent to which they facilitate learning among others in the corporation and those who work with them.

Their attitudes and support to HRD function and systems

Internal efficiency of the HRD function (HRD Department)

HRD Staff…How professionally qualified are they?

Do they seem to demonstrate adequate knowledge base?

Are adequately trained in the appropriate HRD systems?

Are they sensitive to internal customer requirements? How good is their skill base in implementing various

systems? Do they demonstrate OCTAPACE values?

Are they quality conscious?

HRD Staff…

Are they familiar with the business goals of the corporation?

Are they cost conscious? Are they empathetic? Do they spend adequate time trying to

understand the requirements of all categories of employees?

Top Management…Do they understand HRD and its significance in achieving

business goals?

· How supportive are they of HRD interventions and values?

· Are their leadership styles facilitative of a learning culture?

· Are they willing to give the time needed for HRD?

· How well do they subscribe to the HRD values like the OCTAPACE values?

· How well do they practice HRD values.

· How committed are they to create a learning culture in the organisation?

· Do they invest their time, effort and energies in employee development?

Line Managers and Supervisory Staff…

· How much do they understand the significance of HRD?

· Are they interested and motivated to develop themselves?

· Are they willing to spend their time and effort in

developing their subordinates?

· How supportive are they of HRD efforts?

• Do they have listening and other skills required facilitating development of their juniors?

HRD Styles, Culture and Values…• The extent to which the leadership and managerial

styles are empowering and competence building is assessed by studying the leadership and supervisory styles.

• The extent to which the HRD culture and values are practised and stabilised in the corporation are measured.

▫ The HRD culture is culture that promotes Human potential development.

▫ It is also a culture that promotes a learning organisation.

Business linkages of HRD…• This score indicates the extent to which HRD efforts (tools,

processes, culture etc.) are driven to achieve business goals. • The business goals includes:

· Business Excellence including profitability and other outcomes the organization is expected to achieve;

· Internal operational efficiencies; · Internal Customer satisfaction; · External Customer satisfaction; · Employee motivation and commitment; · Cost effectiveness and cost consciousness among

employees; Quality orientation;

Role of HRD Audit in Business Improvements •HRD audit is cost effective •It can give many insights into a company's

affairs. • It could get the top management to think

in terms of strategic and long term business plans.

•Changes in the styles of top management•Role clarity of HRD Department and the

role of line managers in HRD

Role of HRD Audit in Business Improvements• Improvements in HRD systems• Increased focus on human resources and human

competencies• Better recruitment policies and more

professional staff• More planning and more cost effective training• Strengthening accountabilities through appraisal

systems and other mechanisms• Streamlining of other management practices• TQM Interventions

Organisations that Have done HRD Audit•Aditya Birla Group has been doing it for

the last 8 years▫Rajashree Cement, Vikram Cement,

Hindalco, Indo-Gulf Fertilisers, Gwalior Grasim, Harihar Fibres etc.

•L&T, Crompton Greaves•Gujarat Guardian•Gujarat Gas•Apollo Tyres•Alexandria Carbon Black

Some Organisations using HRD Audit

•Godrej Soaps•GVFL•BPL•Tyco International•Gati Cargo Management Services•Wokhardt Hospitals•For detailed client list visit:

www.hrdaudit.com

"The unexamined work life is not worth living."

“The things that get measured gets managed”

Socrates’ (469-399 BC)

Kaplan (2000)

Thank you….