HR Auditing: The perspective of HR Directors
by Shamila Singh
A national framework, i.e. the National HR Standard Systems Model was developed to clearly define the practice of HR professionalism. The HR Standards Model outlines explicit standards and reduces inconsistencies in HR practices within companies, across companies, industries and nationally. The national framework consists of an HRM System Standard with 13 elements and a National HR Competency Model.
To legitimise the assertion of being “business partners”, HR directors and managers must clearly demonstrate how HR services can contribute towards achievement of business objectives. The National HR Standards Systems Model is a framework that organisations can use to benchmark their HR practices to obtain an independent assessment of HR Practices. The HR function is often overlooked for audits and measurement tools which assess its effectiveness. Too often, audits are restricted to checking on regulatory compliance.
However, the SABPP HR Audit is a process that sets the stage for a true transformation in HR strategy and services. It links HR systems and services to organisational objectives while focusing on the business needs of HR’s internal customers.
The SABPP HRM System Model shows how integrated all the elements must be:
The value of auditing an organisation’s business processes and management systems is well accepted. Considerations include good governance, adoption of good practices and process improvement. Standards are considered to be “distilled wisdom” and are the result of international, expert consensus. Therefore, by implementing a management system standard, organisations can benefit from global management experience and good practice. Global and national standards bodies have developed and implemented standards in major functions such as finance, engineering, quality management, environmental management, health and safety, energy and risk management.
Until recently, worldwide, the one business function that has not been systematised has been the human resource management (HRM) function. HRM is often considered to be concerned with “soft” issues and therefore not amenable to being regulated by the adoption of a management standard.
The field of Human Resources (HR) has evolved in recent years, so much so that all South African universities now offer HR qualifications. Most business leaders acknowledge effective people management practices provide superior performance and provide businesses with a sustainable competitive advantage. Coupled with the King IV Code on Corporate Governance sustained performance is a measure of financial, environment and social performance, which in essence is what integrated reporting is all about. The King Code recognises that social performance (people) is a significant aspect of organisational performance. Directors yearn for solutions to effective people management practices. Directors want assurance that the organisation is able to attract, motivate and retain the right skills to attain strategic objectives. In addition, HR Directors want to be assured that the HR practices are aligned to best practice, appropriate, cost efficient and effective in driving business objectives.
Dr Shamila Singh is Interim Head of the SABPP Audit Unit. She managed several audits against the National HR Standards.