Don’t Fear the Audit! – 3 Benefits of an HR Department Audit
Since an audit requires probing and transparency, the simple mention of the word often conjures terror in the minds of even the most experienced managers. However, audits are necessary to determine the vitality of your HR department.
An audit is much like the physical examinations we subject ourselves to, as a preventative measure or in order to address a specific health concern. The end goal is overall health. So, we are aware that failure to take preventative measures could result in a catastrophic outcome. Approaching an audit from that perspective, makes it is easier to understand why it is a necessity. Hopefully, shifting focus to the benefits of an audit will make the task a lot less terrifying.
Benefits of conducting an HR audit:
- Help Identify & Manage Risk.
Risk management involves evaluating policies and procedures (using governing laws and regulations) to identify risks unique to your company. Auditing provides an evidence-based assessment of the department’s areas of strength and areas of vulnerability. Based on the audit findings, management can prioritize areas of risk, in order of greatest exposure and develop a plan of action to effectively manage those risks.
- Ensure Compliance.
Managing risk and ensuring compliance work hand in hand. Once risks have been identified, a plan of action must involve the implementation of controls (e.g. policies and procedures) and/or review and possible revision of existing controls. The audit process allows your company the opportunity to take inventory of the laws and regulations that govern your business and make necessary changes to ensure compliance.
- Supports Strategic Planning.
Now more than ever, HR managers are viewed as strategic partners of the executive team. Successful HR strategic partners must: 1) hire, develop and retain the right talent; 2) ensure policies and procedure are efficient and compliant; and 3) economically deploy the company’s resources. An audit of the department would aid HR managers in better understanding its current state, in order to make strategic adjustments that support and align with the company’s overall goals.
Failure to audit HR limits the department’s efficiency and increases your company’s exposure to litigation and penalties associated with noncompliance. Still not sure where and how to get started?
Schedule your complimentary consultation with 3HRive Business Consulting…we are your HR Partners!