Benefits of an HR Audit

Employees are one of the most valuable assets of an organization and taking steps to safeguard this asset is the task of the human resource department. The human resource department has big responsibilities like managing payroll, managing attendance and managing various compliance-related issues and thus plays a very crucial role in the success of the organization. Such an important department of the organization should be competent enough to carry out its role and responsibilities perfectly. To evaluate the competency of the HR department, an HR audit is required and this can be performed by hiring an external human resources consultancy. Let’s see the benefits of an HR audit.

An effective HR audit proves to be useful in identifying the need for improvement in HR department. It helps to identify the gap between the standards set by the organization and the actual performance of the department. An HR consultant who performs the audit can point out the deviations of the HR department from the organization’s set policies. An HR audit by one of the best HR consulting firms can facilitate the organization in aligning itself with the ever-changing rules and regulations and abiding by the statutory compliance. It is also very helpful in reviewing HR policies and procedures and taking a decision regarding them. HR policies may have to be modified, updated or removed and new policies may need to be implemented. An audit performed effectively gives useful insights that help in understanding the need of review of the organization’s policies and procedures. The benefits of an HR audit by a human resources consultancy of repute can be outlined as below:

Classification of HR department’s duties and responsibilities

• Increase in the professional image of the department.
• Identification of the invaluable contributions made by the department.
• Encouragement to implement personnel policies accurately and implement any changes if required.
• Assurance of timely compliance with all statutory requirements.
• Identification of any deviations from the set standards of the organization and any critical issues of the employees.

To take advantage of all these benefits for your organization reach out to Accuprosys, one of the best HR consulting firms in Hyderabad. Though HR audit is not mandatory, it provides immense value to the organization by evaluating the department’s services and assessing its compliance with the statutory laws.

Objectives and Purpose of HR Audit

The purpose of an HR audit is to spot the strengths and weaknesses of all the HR functions and to identify the scope for improvement. Organizations that hire HR consultancy services for HR audit purpose should understand to perform a comprehensive audit of their HR department functions, they have to be honest and correct in providing info on their current practices, procedures, and policies.

They even have to allow the HR consultancy services doing the audit to benchmark them against

alternative organizations from an equivalent trade or of comparable size.

HR auditing involves a review of varied areas that embody legal and statutory compliance, compensation, benefits, performance appraisal systems, HR policies and practices regarding various matters related to health, safety, termination, and security of employees. HR auditing isn't routine for many organizations and there aren't any rules that make it necessary for employers to conduct HR audits. However, so as to accord with labor laws, organizations have to depend on either their lawyers or on external HR consulting firms to review their policies and practices. Larger organizations develop their own in-house review processes. But, for smaller organizations, it gets difficult to develop in-house auditing processes, so they can outsource this work to HR consultants who can do this job perfectly in line with the organizational goals. The end result of an HR audit is meant to assist organizations to  confirm what changes have to be enforced, and how these can impact the organizational goals and what are the areas and functions that are to be prioritized.

What are the best practices?

Even before the start of the audit, it's advisable to be prepared with a checklist as it is essential to outline the goals of the audit and its success criteria. Along with these, a checklist ought to be got ready to assess the presence and absence of specific practices and to match these practices with policies applicable. Some questions that the organizations can put to themselves at the time of HR audits are – what are the policies and practices that have to be audited, what are the records that are to be checked, and what kind of analysis is required from the audit.

One of the best practices of any audit is asking open-ended questions rather than close-ended questions. The same holds true for HR audits as well. Questions should be framed in such manner that they bring out a descriptive response instead of non-descriptive one. Once all the descriptive information is gathered from different sources, it needs to be checked if the information gathered is accurate without any discrepancies and miscommunication flaws. In order to achieve this, HR consultants should gather information in such a way that the information can be used for quantitative analysis.

It is not just sufficient to identify the strengths and weaknesses of the current HR functions with the conduct of HR audit. An HR audit purpose is solved only then when the practices to be followed in the future are suggested that are in line with the organizational goals and are remedial to the existing flaws in HR functions.

For all the audit needs of your organization, consult one of the best HR consulting firms in Hyderabad, Accuprosys.

Why should you outsource your HR function?

HR is a critical function and most companies handled it in-house. Most HR departments act as a one-stop-shop for employees with concerns that need to be addressed right from benefits to hiring, training, complaints, colleagues, etc. The only department that handles recruitment, retention and termination. Now, this is all changing very rapidly. Presently, about 50 percent of large companies outsource the entire or at least a part of their HR needs.  

Now, the first thing that comes to our mind is why? Is it a welcome change? In today’s times it difficult to classify it as welcome or unwelcome coz one size doesn’t fit all! The idea is to formulate a strategy that works best for you!  

Depending on the volume of your HR functions and the size of your business, there may be various reasons to convince you that outsourcing is totally worth your time and money. You may want to stop and notice if there is a drop in your team’s productivity coz they have to extend their work schedule to fit in the gazillion tasks. If such is the case, have no doubts that HR outsourcing would ensure huge benefits! Accuprosys HR services can be a real-time partner for a business of any size thus ensuring actual impact at the bottom level!  Let us see how HR out sourcing can benefit an organization.

Top 5 reasons most companies are turning over to HR outsource:

1)  Focus on core competencies: 

Although HR function does not directly contribute in product development, it definitely consumes a whole lot of time and energy channelization. A good HR department aims for and works towards continuous innovation. Outsourcing the HR functions would help most companies to focus on their core competencies.

Related: 

2)  Saves money: 

Hiring and running a top-class and efficient HR department doesn’t come easy. It will cost money – a lot of it! This is one very important benefit outsourcing can provide. One it saves money and it helps hire experienced specialists whom they may never be able to afford otherwise coz it would cost a fortune to bring them on-board permanently. 

3) Takes compliance off load: 

Oh! Those numerous compliances and regulations that an organization is out through - Difficult to keep track isn’t it? Talk about lawsuits for sexual harassment, wrongful termination, safety violations, etc. Pass on these burdens to the expert through outsourcing! 

4) Better recruitment:

 When recruiting top talent, organizations may actually have hiccups as it takes efforts and is an art in itself. It makes sense in outsourcing these critical recruitments rather than depending on in-house team as it is likely to be an inefficient and time consuming task.  

5)  Updated tools and technology:

The very latest technology, such as big-data mining, analytics, virtual workforce leadership, cloud technology and social media are a cake walk for expert HR-services supplier. They will aptly be able to use the right blend to crack the specific organizational needs and objectives. 

Although the above are the benefits of out-sourcing, its important to bear in mind that it has its own shortcomings. First and foremost, this means you are a very important aspect of your organizational success outward.  This may bring up conflicting issues between the two. It’s of paramount importance that you find the right and amicable partners. Ensure you do your due diligence right!  

Outsourcing is a sure fire way to totally amplify your organization performance by making the functions of your organization leaner, much more adaptive, profitable and smarter. However, it all depends on how carefully you choose your partner. 

This decision has to be made with lot of foresight and understanding of  how things will move forward. 

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Cracking HR Audits – 3Essential Tips for an Efficient Internal HR Audit

Oh my god…the A-word – Most managers cringe at the prospect of conducting an audit. More often than not, this loathing is the result of a hunch that HR audits are bound for failure. This we tell you isn’t true! HR audits are crucial for the evaluation of HR policies and practices, to understand how effective the training programs and services are, how well the HR division is delivering on these services and programs, and to find opportunities to enhance or cut down on specific activities.

Experts say an HR audit is as important for your organization as your visit to the doctor! To make HR audits a little ‘less cringe-worthy’, here are three essential tips on how you can get the best out of an internal HR audit:

1.      Take the Right Approach

Start the audit by reviewing the hiring system, the offer letters, on-boarding processes and the paperwork associated with all these processes. Then assess how well your HR division informs and educates employees on the company’s policies and practices. This can be done by asking questions like, Is the personnel policy manual/employee handbook up to date, are new hires given a hard copy of the handbook or shown how to access it online, what health and safety training is imparted to employees, how is this training tracked, is the organization capable of mandating sexual harassment prevention training for managers, etc.

Then, review the systems that support the company’s relationship with employees. These include evaluation of performance management systems, assessment of compensation structures, analysis of training and development programs and the employee grievance redress mechanism. One must also analyze the employee reward systems in place. Finally, the HR audit should end by assessing how well the organization manages exiting employees. Are they given their final paychecks on time, are critical forms and personnel files retained for an appropriate period of time, are they informed about post-retirement benefits, etc. The efficiency of an HR audit lies in this step-wise breakdown of the audit process. 

2.      Know Where You are Going

Before an audit is actually conducted, it is essential to determine which aspects of which HR function require evaluation. Is it the overall function that needs to be evaluated, or is there a need for an in-depth consideration of all or specific functional areas?Is the company in compliance, does it meet employee and customer demands, is each program and service in alignment with these goals and demands? These are some of the questions that can be asked before embarking on an audit to make it more focused and efficient. 

3.      Focus on More than Just Turn-Over

Of the many blunders that managers do in an HR audit is the tracking of turn-over only. Auditors just track turn-over without any particular regard to other aspects of it. Rather, they should track what percentage of the turn-over is among the high performing, skilled and experienced staff. Even if the turn-over is low, it is a matter of concern if a large proportion of it comprises of top performers. On the other hand, a high turnover could actually be advantageous if it is more among those with low productivity or those with unacceptable conduct.

Follow these three tips and you can sail smoothly through any internal HR audit by making it more efficient and useful. 

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