Academic journal article Public Personnel Management

The HRM Effectiveness Audit: A Tool for Managing Accountability in HRM

Academic journal article Public Personnel Management

The HRM Effectiveness Audit: A Tool for Managing Accountability in HRM

Article excerpt

Both public sector and not-for-profit organizations continue to wrestle with the challenges of defining and managing organizational effectiveness. Human resource management teams are drawn increasingly into new strategic and operational initiatives proceeding under a variety of labels, e.g., downsizing, reinvention and business process improvement. Over the past ten years, a significant number of HR executives joined their organizations' strategic planning teams. Twisting between the realities of fewer resources and expanded accountability, HRM strategic planning often flounders. This is due to the lack of simple, yet compelling management tools for demonstrating how HRM services contribute to the accomplishment of broader organizational objectives. The author offers a proven model, the HRM Effectiveness Audit, as a guide for establishing a measurement-based, value-added service improvement system. Through partnering and training, the author has helped implement HRM reviews in a variety of organizations, including the U.S. Patent and Trademark Office, Virginia Department of Social Services, and South Carolina Budget and Control Board -- Office of Human Resources.

As we move into the 21st century, public sector and not-for-profit organizations continue to wrestle with the challenges of defining and managing their effectiveness. On the federal level, initiatives have been largely driven by Congressional oversight arising from the Government Performance and Results Act of 1993 (GPRA). GPRA requires federal agencies to demonstrate contributions to organizational results through performance measurements and strategic planning. In 1998, the Office of Personnel Management published the HRM Accountability System Development Guide to provide guidelines to human resource management (HRM) teams. On the state level, executive and legislative mandates to downsize and reduce operating costs continue to force HRM teams to re-examine their internal business methods.

Not-for-profits also face strong pressures. For example, to qualify for Medicare payments, health care systems are subject to regular reviews by the Joint Commission on Accreditation of Health Care Organizations (JCAHCO). HRM teams in these organizations must demonstrate their contribution to enhancing the quality of organization-wide services.

Yet, with all these initiatives, HRM teams continue to struggle with the challenge of how best to maneuver in the new arena of higher accountability and expectations.[1] In some organizations, the power of the customer has been harnessed. HRM teams take "a partnership approach" with the agencies they serve.[2] There is a cry for new tools to equip the HRM adequately to participate as a "strategic business partner."[3]

This article offers a practical procedural model for auditing, measuring and improving HRM services. The generic model springs from Ray Borbidge's The HRM Effectiveness Audit[4] written during Borbidge's association with the author. Over time, this model has been shaped and refined as the result of numerous audits conducted in a variety of public and private sector organizations.

The audit unfolds through four phases (Figure 1):

* Phase I: Ranking Importance of the HRM Service Portfolio

* Phase II: HRM Team Self-Evaluation

* Phase III: Measuring Current Service Levels

* Phase IV: Developing Action Plans

Core Principle: High Involvement of Internal Customers

The audit pivots around the core principle of high participation of internal customers. Many business improvement efforts fail by neglecting to involve customers in the definition of what "effectiveness" means for delivery of a product or service. Private sector organizations learned this lesson years ago. In particular, the automotive industry improved its competitive position by more actively engaging customers in product design. Consequently, the industry now effectively challenges international competitors who previously cut deeply into their market share. …

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