1 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition. 15 F I F T E E N Human Resource Auditing C H A P T E R

2 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Human Resource Audit An examination of the human resource policies, practices, and systems of a firm (or division) to eliminate deficiencies and improve ways to achieve goals.

3 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Benefits of a HR Audit Helps align HR goals Finds better ways for HR to contribute Ensures timely compliance Reduces human resource costs Provides specific, verifiable data Stimulates uniformity Discloses how well managers are doing Uncovers critical problems & solutions Reviews and improves information system Creates a more professional image

4 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Importance of HR Research Legal implications People costs are significant Department’s activities help shape productivity and quality of work life Critical resource is human resources Growing complexity of human resource work

5 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Steps in Conducting HR Audits Defining the scope of the audit Choosing the researchapproach Selecting research design and data collection method Analyzing data, evaluation and preparing report

6 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition The Scope of HR Audits Managerial Compliance Employee Satisfaction Managers must comply with HR policies, procedures and legal requirements Human resource departments should attempt to meet employee objectives where feasible Alignment with Corporate Strategy HR strategy must be consistent with corporate strategy and continually examined

7 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Research Approaches to Audits Compliance Management- by-objectives Reviews past practices Creates specific objectives to assess performance dimensions Comparative Simplest form of research Uses another division or company as a model or may use benchmarks as indices Reviews documentation to ensure managers are complying with policies and laws Balanced scorecard looks at multiple perspectives

8 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Research Design & Data Collection Interviews Surveys Records analysis Human resource experiments

9 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition InterviewsInterviews Interviews with employees and managers Exit interviews –Interviews with departing employees to gauge their impressions of a firm’s strengths and weaknesses, especially relating to HR systems and policies

10 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition SurveysSurveys Surveys –May be used to supplement interviews Attitude surveys –Systematic assessment of employees’ opinions about various work-related factors

11 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Attitude Surveys Areas of Concern Employee attitudes about Supervisors Employee their jobs Perceived effectiveness of HR department

12 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Records Commonly Reviewed Safety and Health Records Productivity Records Grievance Records Human Rights Compliance Records HR Implementation Records Employee Files and Records Compensation Records Special Programming Reports Job Placement/ Selection Records

13 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Human Resource Experiments Field experiment –HR compares results of an experimental and a control group –e.g. Implement safety training program with experimental group and compare subsequent safety records with the control group

14 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition The Audit Report A comprehensive description of HR activities, containing commendation for effective practices and recommendations for improving ineffective practices.

15 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Preparing for the Future Audits are necessary, but they are backward looking Human resource departments require a proactive approach and a future orientation

16 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Challenges Facing HR Managers Productivity improvement Preparing for a greying workforce Changing values Innovation Portable pensions Technological changes more

17 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition Challenges Facing HR Managers Constitutional changes Employee rewards Integrating immigrants into the organization Women and minority workers Dual-career families Protecting employee privacy

18 Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved.Schwind 7th Canadian Edition. 15 F I F T E E N Human Resource Auditing C H A P T E R