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HRM Audit Road-map_5 6 September 2013

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Charles Cotter, PhD
Charles Cotter, PhD

This document outlines a 2-day training program on HR auditing. It introduces the topic and covers the fundamentals, scope, and process of HR auditing. The training will define HR auditing and discuss its purposes, benefits, and principles. It will also explore the typical areas and measures used in HR audits. A 3-phase process is described: initiation, assessment, and concluding/reporting. Learning activities are interspersed to apply the concepts. The goal is to help organizations understand how to effectively audit their HR programs and practices.

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HR AUDIT ROAD-MAP CROWNE PLAZA HOTEL, ROSEBANK 5-6 SEPTEMBER 2013 CHARLES COTTER
2-DAY TRAINING PROGRAMME OVERVIEW • INTRODUCTION • THE FUNDAMENTALS OF HRM AUDITING • THE SCOPE OF HRM AUDITING • THE PROCESS OF HRM AUDITING
INTRODUCTION • “How does a firm know if its human resource practices have an impact on business results? • “..most professional service firms and organizations complete an extensive audit of their financial statements on an annual basis, but the programmes involving “people”, such as recruiting, training or pay-for-performance are seldom given the same scrutiny.” • “..the starting point for enterprises wishing to manage their human capital successfully and seeking a labour competitive advantage is activities of the HR department.” • COMPLETE THE INTRODUCTORY LEARNING ACTIVITY
THE FUNDAMENTALS OF HRM AUDITING • DEFINING HRM AUDITING • THE DRIVING FORCES OF HRM AUDITING • THE PURPOSE AND OBJECTIVES OF HRM AUDITING • THE BENEFITS OF HRM AUDITING • POTENTIAL DRAWBACKS OF HRM AUDITS • THE CRITICAL SUCCESS FACTORS OF HRM AUDITING • THE PRINCIPLES OF EFFECTIVE HRM AUDITING
PURPOSES OF HRM AUDITING •VALUE •COMPLIANCE •RISK
PURPOSES OF HRM AUDITING •VALUE – STRATEGIC (ROI); OPERATIONAL (EFFECTIVENESS); ADMINISTRATIVE (EFFICIENCY) AND RESOURCE OPTIMIZATION (ECONOMICAL) •COMPLIANCE – LEGISLATIVE AND ORGANIZATIONAL POLICY •RISK – PEOPLE AND RELATED E.G. OHS
BENEFITS OF HRM AUDITING
THEPRINCIPLESOF EFFECTIVEHRM AUDITING • NEED FOR INDEPENDENCE; • AUDIT ACTIVITIES SHOULD BE BUDGETED FOR PROPERLY; • ACKNOWLEDGEMENT THAT THERE ARE MANY TYPES OF AUDITS; • EACH TYPE OF AN HR AUDIT HAS ITS OWN PURPOSE AND OBJECTIVES; • ESTABLISH TIMEFRAMES FOR EVERY PHASE/STEP OF THE AUDIT; • TRAINING OF AUDITORS IS A MUST; • SET STANDARDS FOR THE HR AUDITS; • AGREE ON REPORTING TEMPLATE; • AUDITORS SHOULD SIGN A CONFIDENTIALITY AGREEMENT; AND • AUDITORS SHOULD AGREE BEFOREHAND ON COMMUNICATION STRATEGY.
LEARNING ACTIVITY 1 • COMPLETE THIS ACTIVITY (PAGES 21-22) IN SYNDICATE GROUPS COST-BENEFIT ANALYSIS OF HRM AUDITING GAP ANALYSIS OF CURRENT HRM AUDITING PRACTICES • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
THE SCOPE OF HRM AUDITING • THE HR ELEMENTS/FOCAL POINTS WITHIN THE SCOPE OF HRM AUDITS • TYPES OF AUDITS • COMMON AREAS FOR HRM AUDITING
THE SCOPE OF HRM AUDITING
COMMON AREAS OF HRM AUDITING • HRM AND RELATED • HRD AND RELATED • HR INFORMATION SYSTEMS • THE SERVICE ROLE OF HR • HR LEGISLATIVE COMPLIANCE • THE STRATEGIC ROLE OF HR
HRM AUDIT MEASURES • HR PLANNING • RESOURCING – RECRUITMENT EFFICIENCY AND EFFECTIVENESS • COMPENSATION AND BENEFITS MEASURES • ORIENTATION/ON-BOARDING • EMPLOYEE COUNSELING AND DISCIPLINARY COSTS • LOST TIME COSTS • EMPLOYEE TURNOVER RATES • TRAINING AND DEVELOPMENT COSTS E.G. ROI • ORGANIZATIONAL DEVELOPMENT AND CHANGE MANAGEMENT
SABPP NATIONAL HR STANDARDS REFER TO ANNEXURE: • Strategic HR Management • Talent Management • HR Risk Management • Workforce Planning • Learning & Development • Performance Management • Reward • Employee Wellness • Employment Relations Management • Organization Development • HR Service Delivery • HR Technology • HR Measurement
LEARNING ACTIVITY 2 • COMPLETE THIS ACTIVITY (PAGE 43) IN SYNDICATE GROUPS IDENTIFY THE SCOPE (FOCAL AREAS) OF A HRM AUDIT DEVELOP HRM AUDIT MEASURES FOR EACH OF THESE FOCAL AREAS • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
HRM AUDITING PROCESS • PHASE 1: FOUNDATIONAL/INITIATION • PHASE 2: ASSESSMENT • PHASE 3: CONCLUDING AND REPORTING
OVERVIEW OF THE GENERIC HRM AUDITING PROCESS • DESIGN AND DEVELOP HR POLICIES, PROCEDURES AND PRACTICES FOR YOUR ORGANIZATION; • ASSESS CURRENT HR POLICIES, PROCEDURES AND PRACTICES AGAINST SET CRITERIA; • ANALYSE THE RESULTS FROM EVIDENCE; AND • TAKE ACTION: TO CLOSE GAPS, MAKE RECOMMENDATIONS/ SET IMPROVEMENT GOALS.
HRM AUDITING PROCESS ILLUSTRATED
HRM AUDITING PROCESS ILLUSTRATED
PHASE 1: FOUNDATIONAL/INITIATION • AUDIT SET-UP ACTIONS • AUDIT PLANNING ACTIONS Determine the purpose and objectives of the audit Determine the scope of the audit Determine the organizational components to be audited Determine the auditing tool to be used Determine costs and resources needed to perform the audit Determine audit team governance
LEARNING ACTIVITY 3 • COMPLETE THIS ACTIVITY (PAGES 56-57) IN SYNDICATE GROUPS APPLY PHASE 1: FOUNDATIONAL/INITIATION OF THE 3- STEP HRM AUDIT CYCLE • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
PHASE 2: ASSESSMENT • GENERAL COMMENTS • IDENTIFY KEY ORGANIZATIONAL METRICS - DETERMINE EMPLOYMENT ISSUES ACCOUNTABILITY • DEVELOPING A CHECKLIST REFER TO THE ATTACHED ANNEXURE: HUMAN RESOURCES BEST PRACTICE AUDIT AND NEEDS ASSESSMENT TOOL • FORMULATING AUDITING METHODOLOGY AND TOOLS
LEARNING ACTIVITY 4 • COMPLETE THIS ACTIVITY (PAGES 60-61) IN SYNDICATE GROUPS APPLY PHASE 2: ASSESSMENT OF THE 3-STEP HRM AUDIT CYCLE • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
PHASE 3: CONCLUDING AND REPORTING • REPORT PREPARATION • REPORT PRESENTATION QUANTIFY YOUR RESULTS - START WITH OUTCOMES INCLUDE AN EXECUTIVE SUMMARY IDENTIFY RISKS IDENTIFY AND PRIORITIZE SOLUTIONS TO PROBLEMS IDENTIFY. WHERE POSSIBLE, FRAME YOUR SOLUTIONS FROM A BOTTOM LINE PERSPECTIVE, I.E., CALCULATE THE BENEFITS AND COSTS OF PROPOSED SOLUTIONS EVALUATE AND DISCUSS THE ORGANIZATIONAL, FINANCIAL AND EMPLOYEE RELATIONS IMPACT OF ACTION OR INACTION • DEVELOP A HR IMPROVEMENT PLAN
LEARNING ACTIVITY 5 • COMPLETE THIS ACTIVITY (PAGE 63) IN SYNDICATE GROUPS APPLY PHASE 3: CONCLUDING AND REPORTING OF THE 3-STEP HRM AUDIT CYCLE • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
CONCLUSION • SUMMARY OF KEY LEARNING POINTS • QUESTIONS • FINALIZATION OF TRAINING ADMINISTRATION • THANK YOU • GOOD LUCK WITH YOUR ORGANIZATIONAL HRM AUDIT
CONTACTDETAILS • CHARLES COTTER • 084 562 9446 • charlescot@polka.co.za • LINKED IN • TWITTER: Charles_Cotter

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HRM Audit Road-map_5 6 September 2013

  • 1. HR AUDIT ROAD-MAP CROWNE PLAZA HOTEL, ROSEBANK 5-6 SEPTEMBER 2013 CHARLES COTTER
  • 2. 2-DAY TRAINING PROGRAMME OVERVIEW • INTRODUCTION • THE FUNDAMENTALS OF HRM AUDITING • THE SCOPE OF HRM AUDITING • THE PROCESS OF HRM AUDITING
  • 3. INTRODUCTION • “How does a firm know if its human resource practices have an impact on business results? • “..most professional service firms and organizations complete an extensive audit of their financial statements on an annual basis, but the programmes involving “people”, such as recruiting, training or pay-for-performance are seldom given the same scrutiny.” • “..the starting point for enterprises wishing to manage their human capital successfully and seeking a labour competitive advantage is activities of the HR department.” • COMPLETE THE INTRODUCTORY LEARNING ACTIVITY
  • 4. THE FUNDAMENTALS OF HRM AUDITING • DEFINING HRM AUDITING • THE DRIVING FORCES OF HRM AUDITING • THE PURPOSE AND OBJECTIVES OF HRM AUDITING • THE BENEFITS OF HRM AUDITING • POTENTIAL DRAWBACKS OF HRM AUDITS • THE CRITICAL SUCCESS FACTORS OF HRM AUDITING • THE PRINCIPLES OF EFFECTIVE HRM AUDITING
  • 5. PURPOSES OF HRM AUDITING •VALUE •COMPLIANCE •RISK
  • 6. PURPOSES OF HRM AUDITING •VALUE – STRATEGIC (ROI); OPERATIONAL (EFFECTIVENESS); ADMINISTRATIVE (EFFICIENCY) AND RESOURCE OPTIMIZATION (ECONOMICAL) •COMPLIANCE – LEGISLATIVE AND ORGANIZATIONAL POLICY •RISK – PEOPLE AND RELATED E.G. OHS
  • 7. BENEFITS OF HRM AUDITING
  • 8. THEPRINCIPLESOF EFFECTIVEHRM AUDITING • NEED FOR INDEPENDENCE; • AUDIT ACTIVITIES SHOULD BE BUDGETED FOR PROPERLY; • ACKNOWLEDGEMENT THAT THERE ARE MANY TYPES OF AUDITS; • EACH TYPE OF AN HR AUDIT HAS ITS OWN PURPOSE AND OBJECTIVES; • ESTABLISH TIMEFRAMES FOR EVERY PHASE/STEP OF THE AUDIT; • TRAINING OF AUDITORS IS A MUST; • SET STANDARDS FOR THE HR AUDITS; • AGREE ON REPORTING TEMPLATE; • AUDITORS SHOULD SIGN A CONFIDENTIALITY AGREEMENT; AND • AUDITORS SHOULD AGREE BEFOREHAND ON COMMUNICATION STRATEGY.
  • 9. LEARNING ACTIVITY 1 • COMPLETE THIS ACTIVITY (PAGES 21-22) IN SYNDICATE GROUPS COST-BENEFIT ANALYSIS OF HRM AUDITING GAP ANALYSIS OF CURRENT HRM AUDITING PRACTICES • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
  • 10. THE SCOPE OF HRM AUDITING • THE HR ELEMENTS/FOCAL POINTS WITHIN THE SCOPE OF HRM AUDITS • TYPES OF AUDITS • COMMON AREAS FOR HRM AUDITING
  • 11. THE SCOPE OF HRM AUDITING
  • 12. COMMON AREAS OF HRM AUDITING • HRM AND RELATED • HRD AND RELATED • HR INFORMATION SYSTEMS • THE SERVICE ROLE OF HR • HR LEGISLATIVE COMPLIANCE • THE STRATEGIC ROLE OF HR
  • 13. HRM AUDIT MEASURES • HR PLANNING • RESOURCING – RECRUITMENT EFFICIENCY AND EFFECTIVENESS • COMPENSATION AND BENEFITS MEASURES • ORIENTATION/ON-BOARDING • EMPLOYEE COUNSELING AND DISCIPLINARY COSTS • LOST TIME COSTS • EMPLOYEE TURNOVER RATES • TRAINING AND DEVELOPMENT COSTS E.G. ROI • ORGANIZATIONAL DEVELOPMENT AND CHANGE MANAGEMENT
  • 14. SABPP NATIONAL HR STANDARDS REFER TO ANNEXURE: • Strategic HR Management • Talent Management • HR Risk Management • Workforce Planning • Learning & Development • Performance Management • Reward • Employee Wellness • Employment Relations Management • Organization Development • HR Service Delivery • HR Technology • HR Measurement
  • 15. LEARNING ACTIVITY 2 • COMPLETE THIS ACTIVITY (PAGE 43) IN SYNDICATE GROUPS IDENTIFY THE SCOPE (FOCAL AREAS) OF A HRM AUDIT DEVELOP HRM AUDIT MEASURES FOR EACH OF THESE FOCAL AREAS • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
  • 16. HRM AUDITING PROCESS • PHASE 1: FOUNDATIONAL/INITIATION • PHASE 2: ASSESSMENT • PHASE 3: CONCLUDING AND REPORTING
  • 17. OVERVIEW OF THE GENERIC HRM AUDITING PROCESS • DESIGN AND DEVELOP HR POLICIES, PROCEDURES AND PRACTICES FOR YOUR ORGANIZATION; • ASSESS CURRENT HR POLICIES, PROCEDURES AND PRACTICES AGAINST SET CRITERIA; • ANALYSE THE RESULTS FROM EVIDENCE; AND • TAKE ACTION: TO CLOSE GAPS, MAKE RECOMMENDATIONS/ SET IMPROVEMENT GOALS.
  • 20. PHASE 1: FOUNDATIONAL/INITIATION • AUDIT SET-UP ACTIONS • AUDIT PLANNING ACTIONS Determine the purpose and objectives of the audit Determine the scope of the audit Determine the organizational components to be audited Determine the auditing tool to be used Determine costs and resources needed to perform the audit Determine audit team governance
  • 21. LEARNING ACTIVITY 3 • COMPLETE THIS ACTIVITY (PAGES 56-57) IN SYNDICATE GROUPS APPLY PHASE 1: FOUNDATIONAL/INITIATION OF THE 3- STEP HRM AUDIT CYCLE • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
  • 22. PHASE 2: ASSESSMENT • GENERAL COMMENTS • IDENTIFY KEY ORGANIZATIONAL METRICS - DETERMINE EMPLOYMENT ISSUES ACCOUNTABILITY • DEVELOPING A CHECKLIST REFER TO THE ATTACHED ANNEXURE: HUMAN RESOURCES BEST PRACTICE AUDIT AND NEEDS ASSESSMENT TOOL • FORMULATING AUDITING METHODOLOGY AND TOOLS
  • 23. LEARNING ACTIVITY 4 • COMPLETE THIS ACTIVITY (PAGES 60-61) IN SYNDICATE GROUPS APPLY PHASE 2: ASSESSMENT OF THE 3-STEP HRM AUDIT CYCLE • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
  • 24. PHASE 3: CONCLUDING AND REPORTING • REPORT PREPARATION • REPORT PRESENTATION QUANTIFY YOUR RESULTS - START WITH OUTCOMES INCLUDE AN EXECUTIVE SUMMARY IDENTIFY RISKS IDENTIFY AND PRIORITIZE SOLUTIONS TO PROBLEMS IDENTIFY. WHERE POSSIBLE, FRAME YOUR SOLUTIONS FROM A BOTTOM LINE PERSPECTIVE, I.E., CALCULATE THE BENEFITS AND COSTS OF PROPOSED SOLUTIONS EVALUATE AND DISCUSS THE ORGANIZATIONAL, FINANCIAL AND EMPLOYEE RELATIONS IMPACT OF ACTION OR INACTION • DEVELOP A HR IMPROVEMENT PLAN
  • 25. LEARNING ACTIVITY 5 • COMPLETE THIS ACTIVITY (PAGE 63) IN SYNDICATE GROUPS APPLY PHASE 3: CONCLUDING AND REPORTING OF THE 3-STEP HRM AUDIT CYCLE • NOMINATE A SPOKESPERSON TO PROVIDE A SUMMATION OF YOUR SYNDICATE GROUP DISCUSSION
  • 26. CONCLUSION • SUMMARY OF KEY LEARNING POINTS • QUESTIONS • FINALIZATION OF TRAINING ADMINISTRATION • THANK YOU • GOOD LUCK WITH YOUR ORGANIZATIONAL HRM AUDIT
  • 27. CONTACTDETAILS • CHARLES COTTER • 084 562 9446 • [email protected] • LINKED IN • TWITTER: Charles_Cotter