Spring 2010(Jan-June)

Master of Business Administration-MBA Semester 3

MU0004 Human Resource Audit - 2 Credits
(Book ID: B0799)
Assignment Set- 1 (30 Marks)
Note: Each question carries 10 Marks. Answer all the questions.

Q.1 Explain the process of HR Audit in detail [10]

Answer:
The audit process
The HR audit process is conducted in different phases. Each phase is designed to build upon the
preceding phase so that the organization will have a very strong overview of the health of the HR
function, at the conclusion of the audit. These phases include:

Pre-Audit Information: This phase involves the acquiring and review of relevant HR manuals,
handbooks, forms, reports and other information. A pre-audit information request is forwarded to
the client who compiles the necessary information for review by auditors.

Pre-Audit Self-Assessment: In order to maximize the time spent during subsequent portions of
the audit, a pre-audit self-assessment form, if sent to the client can be of use. The self-
administered yes/no questionnaire asks a number of questions about current HR policies and
practices.
The completion of this self-administered questionnaire allows auditors to identify key areas for
focus during the HR audit.

On-site Review: This phase involves an on-site visit at the clients facility interviewing staff
regarding HR policies and practices. A very in-depth HR audit checklist is completed.

Records Review: During the on-site visit, a separate review is conducted of HR records and
postings. Employee personnel files are randomly examined as well as compensation, employee
claims, disciplinary actions; grievances and other relevant HR related information are checked.
Audit Report: The information gathered is used to develop an HR audit report. The audit report
categorizes action needs into four separate areas. The areas that are urgent and important (UI),
not urgent needs but important (NUI), not urgent but not important needs (NNI)), and important
opportunities needs (IO). As a result of this scheme of classification, managements can prioritize
their steps.

The critical areas

The comprehensive HR audit covers all areas of HR management like recruitment practices,
training and development, compensation and benefits, employee and union relations, health,
safety and security, miscellaneous HR policies and practices-welfare, strategic HR issues,
manpower planning/budgeting.
Besides classifying needs in each of the above areas, the HR audit also cites relevant laws,
cases and research to support the recommendations.

Preparation for an audit

Auditor engagement: If external firm carrying out the audit, it is preferable to set terms in writing
defining and agreeing on scope .If using internal resource, it is better to appoint them formally
with clarity on scope and select persons who are non political or those who are not high on
hierarchy. Also, if internal persons are auditing there must be training in auditing.
Documents, manuals, handbooks, forms and reports auditor must have access to relevant
information contained in employee files and other confidential documents of the organization.
Auditors must be given unrestricted access to records, once they sign agreement for
confidentiality.

Data gathering: Completion of a self-assessment questionnaire significantly expedites the audit

process and allows for better audit planning.

On-site access: The on-site portion of the audit is the most critical.
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Q.2 Write a detailed note on Training and Development Audit [10]

Answer:
Training and Development
 Individual and departmental Training and Development plans in place and strategically
linked to departmental strategic objectives
A diverse set of training and development activities (e.g. overseas attachment, overseas
training, secretariat attachment)
Training and Development integrated with PMS and Succession Plan / Manpower Plan
Timely induction training provided to all new staff with management training to be
provided systematically afterwards
Regular review of the Training and Development policies
Evidence of improvement in work quality and efficiency
Managers positive feedback on learners performance
Training courses rated highly in quality and relevance

Importance of Training and Development

Optimum Utilization of Human Resources - Training and Development helps in optimizing the
utilization of human resource that further helps the employee to achieve the organizational goals
as well as their individual goals.

Development of Human Resources - Training and Development helps to provide an opportunity

and broad structure for the development of human resources' technical and behavioral skills in an
organization. It also helps the employees in attaining personal growth.

Development of skills of employees - Training and Development helps in increasing the job
knowledge and skills of employees at each level. It helps to expand the horizons of human
intellect and an overall personality of the employees.

Productivity - Training and Development helps in increasing the productivity of the employees
that helps the organization further to achieve its long-term goal.

Team spirit - Training and Development helps in inculcating the sense of team work, team spirit,
and inter-team collaborations. It helps in inculcating the zeal to learn within the employees.

Organization Culture - Training and Development helps to develop and improve the
organizational health culture and effectiveness. It helps in creating the learning culture within the
organization.

Organization Climate - Training and Development helps building the positive perception and
feeling about the organization. The employees get these feelings from leaders, subordinates, and
peers.

Quality - Training and Development helps in improving upon the quality of work and work-life.

Healthy work-environment - Training and Development helps in creating the healthy working
environment. It helps to build good employee, relationship so that individual goals aligns with
organizational goal.

Health and Safety - Training and Development helps in improving the health and safety of the
organization thus preventing obsolescence.

Morale - Training and Development helps in improving the morale of the work force.

Image - Training and Development helps in creating a better corporate image.

Profitability - Training and Development leads to improved profitability and more positive
attitudes towards profit orientation.

Training and Development aids in organizational development i.e. Organization gets more
effective decision making and problem solving. It helps in understanding and carrying out
organizational policies

Training and Development helps in developing leadership skills, motivation, loyalty, better
attitudes, and other aspects that successful workers and managers usually display.

-Training and Development demonstrates a commitment to keeping employees on the cutting

edge of knowledge and practice.
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Q.3 Mr Deshmukh wants to conduct an HR Audit in his organization. He wants to specifically
audit the Employment Practices and Employee involvement . Suggest what all aspects you may
cover in the questionnaire for the audit. Prepare a questionnaire with at least 15 statements. [10]

Answer:
SAMPLE QUESTIONNAIRE # 1
Example of an internal Human Resources Audit: Please amend using questions from the
comprehensive HR Audit to determine the content of your Human Resources Audit.
(Send a copy of this report to the various departments within your Company or Companies within
your Group)
Please complete the following questionnaire as accurately and thoroughly as possible, attaching
relevant documentation where necessary, and return to By no later than
.

Contact Details

Company Name: Registered As

Trading As
Contact Person: Name:
Title:
Contact Numbers: Tel #
Fax #:
Cell #
E Mail: @
Physical Address:

Postal Address:

Company Details

No1 Yes 1Does the company have a formal Organogram?:

(If yes, please attach. If no, please attach a list of all positions within the company).
Does the company have comprehensive job descriptions for all said positions?
No (If yes, please attach).1 Yes 1
Employee Head count: Permanent Employees:
Permanent Part-Time Employees:
Contract Employees:
Casual Staff:
No1 Yes 1Does the Company have a formal HR Manual?
No1 Yes 1Does the Company have a formal HR Filing System?
Does the Company have a computerized HR/Payroll System?
No1 Yes 1HR:
Brand Name:
Payroll: Yes/No
Brand Name:
What Records and Control Measures are in place?

Employment Details
(For each category, please indicate if applicable to all employees. If not, please supply details.
Further, please indicate whether a policy in regard to that specific category is in place or not and
attach same to this document).
Working Hours: Hours per day: Days per week:
Working Hours Policy: Yes/No
Overtime: Hours per day: Days per week:
No1 Yes 1Overtime Policy in Place:
Annual Leave: working days leave per annum
Sick Leave: days per year/36 month cycle
Maternity Leave: months per occasion
Family Responsibility Leave: per occasion
Study Leave: per examination
Unpaid Leave:

Leave Policy in Place No1 Yes1: Annual

Sick / Yes / No
Maternity / Yes / No
Family Responsibility / Yes / No
Study / Yes / No
Unpaid / Yes / No

Remuneration and Benefit Details

(Please indicate whether a policy in regard to each specific category is in place or not and attach
same to this document).
If available, please supply a copy of the following:
Letter of Employment or Contract
Pay slip
Induction Programme
Employee Handbook
Certificate of Service
Medical Aid: Name of Fund:
Company Contribution Details:

Pension/Provident Fund Fund type:
Pension/Provident
Name of Fund:
Company Contribution Details:

No1 Yes 1Employment Policy:

How are employees salaries?
Packages structured? :

Company Vehicle Policy: Yes / No

Transfer and Relocation Policy: Yes / No
Retrenchment Policy: Yes / No
What is the Official Retirement Age of the Company? Male Years
Female years
Early Retirement Policy: Yes / No
Does the Company offer Educational Assistance? Yes / No
If yes, to whom:
Employees Only
Employees and Employees Immediate children
Other (please specify)
No1 Yes 1Does the Company offer any Loan Facilities:
If yes, please indicate:
To whom
What Category:(e.g. welfare, home)

Other
(Please indicate whether a policy in regard to each specific category is in place or not and attach
same to this document).
Aids & No1 Yes 1Life Threatening Diseases Policy:
No1 Yes 1Disciplinary and Grievance Procedures:
Harassment & No1 Yes 1Non-Discrimination Policies:
No1 Yes 1Smoking Policy:
What are the Companys ratios of employees?
 Company Total White Black Male Female
Senior Management
Middle Management
Supervisory
General Staff
No. of Disabled Employees:
Employment Equity Policy: Yes / No

Information Systems
What computer software programmes do you use:

Do your employees have their own email addresses: Yes / No

Do you have a Corporate Website: Yes / No
If yes, please specify URL: http://www
How many employees have access to e-mail facilities within your
Company /department? .
No1 Yes 1Do any employees work on a contract basis:
No1 Yes 1Do any employees work from home:

Restructuring
No1 Yes 1is it likely that your organization or the terms and conditions of employees may be
restructured?

Are you familiar with the requirements of?

The new Basic Conditions of Employment Act: Yes / No
Employment Equity Act: Yes / No
Code of Good Practice on Sexual Harassment in the Workplace: Yes / No
Labour Relations Act 66 of 1995 (as amended): Yes / No
Skills Development Act: Yes / No
Code of Good Practice on the Regulation of Working Hours: Yes / No
Code of Good Practice on Maternity Leave: Yes / No
Do you participate in any Corporate Social Investment schemes: Yes / No
If yes, please specify which organization: .
Questionnaire Sample # 2
1. Do you comply with federal and state guidelines requiring that certain information must be
posted in view of employees and applicants? Yes / No/ Not Sure
2. How is your employee files organized? Do you comply with current Employee Privacy
regulations? Yes /No /Not Sure
3. Jobs are classified as exempt (salaried) and non-exempt (hourly)? Are you confident that
your job classification system would pass a Dept. of Labor audit if challenged? Yes
/No /Not Sure
4. Do you comply with all the Federal and State laws and requirements applicable to your
company? Yes /No /Not Sure
5. Are your salaries and wages reasonable, competitive and both externally and internally
equitable? Yes /No /Not Sure
6. Do you understand your responsibilities to regularly provide training and/or information to
your employees on legally required topics such as Illegal Harassment Prevention, No
Discrimination, changes to benefits, changes to company policies and procedures, etc?
Yes /No Not Sure
7. Do you have difficulty attracting and/or keeping good, qualified workers? Yes /No /Not
Sure
8. Are you confident that your employees are aware of the work rules in your organization
covering items such as: attendance, absences, tardiness, theft, intoxication, drug use,
insubordination, confidentiality, no harassment, etc? Yes /No /Not Sure
9. Is absenteeism a problem for your organization? Yes /No /Not Sure
10. Is the quality of work or customer service in your organization as high as it could be?
Yes/ No /Not Sure
If you answered No or Not Sure to any four or more of the Questions, you would
benefit greatly from an audit. If you answered No to any one of Questions 1, 2, 3 or 4, you
would benefit greatly from an audit.
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 Master of Business Administration-MBA Semester 3
MU0004 Human Resource Audit - 2 Credits
(Book ID: B0799)
Assignment Set- 2 (30 Marks)
Note: Each question carries 10 Marks. Answer all the questions.

Q.1 Discuss balanced scorecard in the perspective of Business Process and Consumer.[10]

Answer:
Balanced Scorecard
A new approach to strategic management was developed in the early 1990s by Drs. Robert
Kaplan (Harvard Business School) and David Norton. They named this system the balanced
scorecard. Recognizing some of the weaknesses and vagueness of previous management
approaches, the balanced scorecard approach provides a clear prescription as to what
companies should measure in order to balance the financial perspective.
The balanced scorecard is a management system (not only a measurement system) that
enables organizations to clarify their vision and strategy and translate them into action. It provides
feedback around both the internal business processes and external outcomes in order to
continuously improve strategic performance and results. When fully deployed, the balanced
scorecard transforms strategic planning from an academic exercise into the nerve center of an
enterprise.
Kaplan and Norton describe the innovation of the balanced scorecard as follows:
The balanced scorecard retains traditional financial measures. But financial measures tell the
story of past events, an adequate story for industrial age companies for which investments in
long-term capabilities and customer relationships were not critical for success. These financial
measures are inadequate, however, for guiding and evaluating the journey that information age
companies must make to create future value through investment in customers, suppliers,
employees, processes, technology, and innovation.
The balanced scorecard suggests that we view the organization from four
perspectives, and to develop metrics, collect data and analyze it relative to each of these
perspectives:
1. Learning Perspective:
2. Business Process Perspective
3. Consumer Perspective:
4. Financial Perspective:
Out of the above mentioned perspectives, 2 are explained below:
Business Process Perspective:
This perspective refers to internal business processes. Metrics based on this perspective allow
the managers to know how well their business is running, and whether its products and services
conform to customer requirements (the mission). These metrics have to be carefully designed by
those who know these processes most intimately; with our unique missions these are not
something that can be developed by outside consultants.
In addition to the strategic management process, two kinds of business processes may be
identified: a) mission-oriented processes, and b) support processes. Mission-oriented processes
are the special functions of government offices, and many unique problems are encountered in
these processes. The support processes are more repetitive in nature, and hence easier to
measure and benchmark using generic metrics.

Consumer Perspective:
Recent management philosophy has shown an increasing realization of the importance of
customer focus and customer satisfaction in any business. These are leading indicators: if
customers are not satisfied, they will eventually find other suppliers that will meet their needs.
Poor performance from this perspective is thus a leading indicator of future decline, even though
the current financial picture may look good.
In developing metrics for satisfaction, customers should be analyzed in terms of kinds of
customers and the kinds of processes for which we are providing a product or service to those
customer groups.
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Q.2 Write a note on the Employment handbook. [10]

Employee Handbook
While an employee handbook is not required for employers, it is the recommended location for all
of an organizations policies and procedures. Handbooks should be updated at least annually to
ensure that any changes in federal or state laws are reflected as appropriate, as well as changes
to company polices and procedures. For example, recent New Hampshire law changes
necessitate the addition of crime victim leave and first responder leave policies to your personnel
policies. Equally important as the employee handbook content is how well its contents are
communicated to employees.

Employee Handbooks are also often called Policy and Procedures Manuals. The
Handbook/Manual is a statement of the policies of the business and how the business is to be
conducted. The company employee handbook is one of the most important communication tools
between your company and your employees. Not only does it set forth your expectations for your
employees, but it also describes what they can expect from the company. It is essential that your
company has one and that it be clear and as unambiguous as possible. Misunderstandings or
misstatements can create legal liabilities for your business. In legal disputes courts have
considered an employee handbook to be a contractual obligation, so word it carefully.
The company employee handbook and related personnel policies should be one of the first formal
communications that you will have with an employee after they are hired. Make sure the first
impression is a good one. Similarly, in the event of a dispute or poor performance review, this will
be the first place that the employee turns.
The handbook should contain enough detail to avoid confusion, but not so much as to overwhelm.
For instance, if there are other documents (i.e. group insurance handbook, and retirement plan
documents) which more appropriately provide details, don't try to recreate the information in the
handbook. Instead, offer a brief summary and refer to the other document in the employee
handbook. Make sure that you are familiar with the myriad of laws and regulations for
employment. It is always wise to consult with a lawyer on any topics that you don't understand.
The actual policies in the manual will vary from company to company, depending on its size,
number of employees, and benefits offered. Regardless of the size or complexity of your
business, once you hire your first employee its best to take the time to think through the policies
for your company, have at least the minimum list of policies for your employees, and write them
down.

Some of the types of policies you may wish to include in your handbook are:

An Employee Acknowledgement Form

Introduction to the Employee Handbook*
Equal Employment Opportunity Statement*

General Policies:

Personal Information
Attendance
Use of Company Property*
Confidentiality
Dress Code
Safety and Accident Rules*
Substance Abuse
Sexual Harassment
Smoking
Performance Reviews
Employment Categories
Additional Policies

Compensation and Benefits:

Payroll*
Work Hours and Reporting*
Holidays*
Vacation*
Sick Leave*
Family and Medical Leave*
Maternity Leave*
Funeral Leave*
Jury Duty*
Military Service*
Group Insurance Benefits
Short Term Disability
Continuation of Medical/COBRA
Worker's Compensation
Retirement Plans
Tuition Assistance
Employee Assistance Program

Other Benefits
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Q.3 Visit the following site to identify your Big Five http://similarminds.com/big5.html

Explain the five traits in detail, discussing the facets related to each personality factor and mark
the ones you found dominant in your personality, after conducting the test.
[10]

Answer:
The Big Five is currently the most accepted personality model in the scientific community. The Big
Five emerged from the work of multiple independent scientists/researchers starting in the 1950s
who using different techniques obtained similar results. Those results were that there are five
distinct personality traits/dimensions. Here are your results on each dimension:

Extroversion results were moderately high which suggests you are, at times, overly talkative,
outgoing, sociable and interacting at the expense of developing your own individual interests and
internally based identity.

Orderliness results were moderately high which suggests you are, at times, overly organized,
neat, structured and restrained at the expense too often of flexibility, variety, spontaneity, and fun.

Emotional Stability results were medium which suggests you average somewhere in between
being calm and resilient and being anxious and reactive.

Accommodation results were medium which suggests you are moderately kind natured, trusting,
and helpful while still maintaining your own interests.

Inquisitiveness results were medium which suggests you are moderately intellectual, curious,
and imaginative.
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