Escolar Documentos
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Program
Semester
Subject code &
name
Book ID
SUMMER 2015
MBAFLEX/ MBA (SEM 3)
3
MU0013: HR Audit
B1735
Q1
An
s.
Definition of HR Audit - 2
According to Jack J. Phillips A human resource audit is defined as an
investigative, analytical and comparative process that attempts to reflect the
effectiveness of the human resource functions.
According to David Campbell The human resource audit is defined as an
investigation into size, skill, structure, and all other issues surrounding those
currently employed by the orginasation and its future human resource needs.
Human Resource Audit is a systematic assessment of the strengths,
limitations, and developmental needs of its existing human resource in the
context of organisational performance. (Flamholtz, 1987)
According to Dr. Parimalendu Bandopadhyay, HR Audit means the systematic
verification of job analysis and design, recruitment and selection, orientation
and placement, training and development, performance appraisal and job
evaluation, employee and executive remuneration, motivation and morale,
participative management, communication, welfare and social security, safety
and health, industrial relations, trade unionism, and disputes and their
resolution.
Q2
An
s
(i)
Q
3
An
s
Meaning of HR Scorecard - 2
&
implementing
HR
Scorecard
In this era of tough competition it is very important for firms to have more
effective HR management systems. It is a challenge for managers to make HR
a strategic asset. The HR scorecard is an instrument that enables them to
improve the HR function in the organisation. It helps to periodically assess
effectiveness of HR functions in a wide range of areas, from recruiting to
terminations, and including training and development, communications, and
legislative compliance. But implementing effective audit systems for human
resource is a difficult task and demands the existance of a unified framework
to guide the HR managers. Sometimes firms under-invest in their people and
at times invest in the wrong ways. Another difficulty faced by managers is that
they cannot prepare the projected cash flows for future productivity of present
inputs as in the case of financial assets, but at the same time they are not
willing to take the risk. So the best way is to prepare the Balanced Scorecard
with sound measurement strategies which are able to link HR functions,
activity and investment with the overall business strategy. The HR scorecard
framework was specifically designed for the following reasons :
It reinforceses the distinction between the HR do-ables and
deliverables: A good audit system must clearly differentiate between
the deliverables that influence strategy implementation and do-ables
that do not. Policy implementation is not a deliverable until it has a
positive effect on the HR architecture and creates the right employee
behaviours that drive strategy implementation. An appropriate HR
measurement system will encourage HR professionals to think both
strategically as well as operationally.
It helps in controlling cost control and value creation: It is the
responsibility of HR to minimise the cost of the firm but at the same
time HR has to fulfill its strategic goal, which is to create value. The HR
scorecard helps HR professionals balance the two and find the
optiminal solution. It allows HR professionals to drive out costs where
appropriate, but at the same time it helps to create value for the firm
by retaining good human resources.
Q4
An
s
Ther
are
various
factors
leading
to
effective
Group skill
Initiative
Empathy
Patience
Q
5
An
s
Human
Resource
In any firm, along with the optimal utilisation of other resources, human
resources should also be exploited to its maximum potential. Businesses
which utilise their human resources in an effective way have better chances of
succes in the future. Sustainability and progress of business will depend on
new competencies, methods, strategies and value creating processes. Every
organisation has accepted that human resource is the most valuable asset of
an organisation though its value is not mentioned in the balance sheet.
Lack of information regarding human capital was seen as a serious handicap
for decision making, both for the managers, investors (Srivastava 1979: 83)
and for the human resource development process itself. Some of the
controversies that have emerged as hindrances to the very concept of human
asset and to the process of human audit (Khandelwal 1979) is listed below:
a) Since human beings cant be owned by others, it is wrong to use the
term asset without legal ownership. Again it cant be even said that
the services of an employee are owned by an employer during his
employment in the enterprise.
b) While it may be possible to conceive the resource of an employee or his
service, the potential dimension of an employee cannot be conceived or
predicted. Hence, it is difficult to assess or account the same in terms of
any tangible methods. At the most, human potential can be
qualitatively valued.
c) To be valued as an asset, an item should be capable of being valued
with a reasonable degree of objectivity and it should be capable of
substantion at the time of audit. Human beings do not meet with any of
these requirements. Hence, they cannot be shown as assets.
d) The term asset implies some realisable value once out of use. Human
resources have no realisable value. Rather, they actually involve
expenditure in terms of payment of retrenchment compensation,
gratuity and other terminal benefits at the time of retirement, while the
employer does not receive anything on the termination of the services
or on the retirement of an employee.
e) Calling human resources as assets is against human dignity as human
beings are much more than resources.
The study was conducted to find out the effectiveness of HRD audit as an
Organisational Development (OD) tool, and the issues for making it
succeed in an organisation by exploring the factors affecting it. It also
explored the expectations of HR to make the intervention a success. The
Q6
An
s
2.
3.
4.
5.
6.