An audit should be looked at as a process that ensures and enables the HR function in an organization to deliver on its intentions and promises; rather than being approached from a control and compliance mindset.At HCL, the former is what drives HR Audits. The primary purpose of HR Audits is to ensure that the organization’s practices, policies, programs and processes are mature and meet their expressed intent. The overarching objective is to give an employment experience that allows people to be successful. Also, given the scale (1,05,000+ employee base) and scope (over 30 countries) of the organization, audits help in ensuring service deliveryin line with specific statutory requirements.

The entire gamut of HR functions is audited – including talent acquisition, talent development, rewards, performance management and career management among others.Processes with a financial (e.g. pensions) and statutory (e.g. immigration laws) implication are also frequently audited.

The audit procedure

We consider the ‘people-process-technology’ framework in reviewing audits’ impact. That is, we end up using insights from the audits to inform structural or people-related changes (e.g. centralizing the contracting function), process design changes (e.g. instituting quality assurance checklists within recruiting teams to bring consistency), or technology related changes (e.g. automating a procedure).

Audits happen at multiple levels within the organization. At an individual level, people self-certify their performance. At the functional level, there are a series of service and quality assurances. At organizational level, there is a service excellence construct which has a specific set of process reviews and process design checks. Being a listed company, we are also subject to client audits. The internal audit teams audit specific processes every quarter which is selected on the basis of the business context.The right processes are prioritized when setting the quarterly audit calendar.For example, based on the geopolitical scenario, there is an incremental attention to the audit activity in the United States to ensure the company is compliant with local laws. Other than that, standard-driven (e.g. ISO 9000 or ISO 27000 certifications) external audits also happen periodically – either half-yearly or annually. External consultants are also invited to audit which gives an objective perspective on the company’s process design and also allows for benchmarking it against the best practices across the industry.

Case of client contracts

Considering the case of client contracts – at HCL, clients sign a Master Services Agreement with the company. To ensure consistency, the audits we run,ensure specific customized requirements for clientsnoted in contractsare met consistently - possibly why we have a very high success rate in meeting client audit requirements.

Transforming the audit process

We are in the process of enhancing our approach to audit management. We now ensure the participation of a Human Resource professional in the audit team with the responsibility of doing an HR audit. The HR professional can impart the functional know-how to the team and make the process more efficient and effective.

We are also in the process of engaging an external people practices auditor, whose work will be to certify our audits. Having completed a baseline series of people practices audits with an external firm across multiple geographies, we are planning to extend it now to be executed periodically and have the external auditor provide quarterly/annual certification which will take the practice to the next level of maturity.