HRD AuditEvaluating the Human Resource

Function for

Business Improvement

ByDr. Santosh Bagwe

Common worries of all CEOs

• Can my Company cope well with leadership changes

• Can my Company exploit the opportunities• Whether my Company is customer-oriented

and quality conscious• Whether my Company is changing and

learning organization• Can my Company manage changes

Who will provide me solutions for these problems

Elements of Good HRD

• Corporate-strategy- and Business-linked HRD• Systems-engineered and systems-driven HRD• Appropriately structured and competently

handled HRD• Appropriately rooted (in terms of culture and

values) HRD

Role of HRD Audit in Business Improvement

• Changes in the styles of top management• Role clarity of HRD Department• Improvements in HRD Systems• Increased focus on human resources and

human competencies• Strengthening accountability through

appraisal systems

What is HRD Audit

Comprehensive evaluation of- HRD Strategies- Structures- Styles- SkillsIn context of short and long term goals of the

organization

Auditing HRD Strategies

• Assessing competencies required to meet future business needs

• Assessing competencies required to meet business challenges and opportunities

• Finding gaps and planning to bridge the gaps• Devising means to align HRD Strategies to

business goals• Removing bottlenecks in aligning business goals

and HRD Practices

Auditing HRD Culture

• Openness• Collaboration• Trust and trustworthiness• Authenticity• Proaction• Autonomy• Confrontation• Experimentation

Auditing the style of top management

• The general beliefs and attitudes of top management towards people and HRD function

• Their style of assigning tasks, monitoring performance, managing mistakes, conflict, rewards and punishment, communicating vision and sharing information

Auditing the Structure

• Assessing roles, role relationship, task structure, reporting relations, facilities, budget, power and authorities, coordination and integration mechanism to meet business goals

• Evaluating strength and weakness of current structure

Auditing HRD Systems• Manpower Planning and Recruitment• Potential appraisals and promotions• Career planning and development• Role analysis and goal setting• Performance appraisal• Training• Performance coaching and counseling• 360 degree performance feedback• Mentoring• Organization development• Reward and recognition• Empowerment• Communication

Auditing HRD Competencies

• Knowledge testing• Attitudes and values• Self-assessment by HR professionals• Peer level assessment or 360-degree

assessment• Assessment centers• Assessment by line managers

HRD Audit Methodology

• Interviews• Observations• Questionnaires• HR Score Card

Interviews

• Interview with CEO and Top ManagementTo understand expectations, to explain scope and

limitations of audit• Interview with Head HRTo understand current status – systems, structures, style

of top management• Interview with Line Managers and workers’

representativesTo understand HR needs, strength, weakness,

expectations

Observations

• Physical facilities and living conditions• Meetings, discussions and other transactions• Celebrations and other events related to

organizational life and culture• Training and other HRD-related facilities,

including the class-rooms, library, training centre etc.

• Forms and formats, reports, manuals etc.

Questionnaire

• HRD Audit Questionnaire• Mapping HRD practices profile• HRD Climate Survey• Training Effectiveness Questionnaire• Performance planning, Analysis and

Development Questionnaire• Supervisory and Leadership Beliefs Questionnaire• Response from 360 degree feedback

HRD Audit Report

• Competency requirements of the future to achieve planned business outcomes

• Value addition including motivational value, by current systems and subsystems of HRD and the areas needing improvement

• Competency gaps of the HR staff• Current roles being performed by top management,

line managers, unions and gaps between what they could do and currently doing

• Alignment of HR strategies with business goals