Framing Parameters for Auditing Effectiveness of HR Systems of Emerging Enterprises in India

HR Audit is a type of functional audit which aims to diagnose, analyze, evaluate, and assess future line of action within the framework of HRM. The purpose of the HR audit is to conduct in depth analysis of the HR functions thereby to identify areas of strength and weakness and to find out the HR areas that need to be improved. The basic goal of HR audit is to review the current HR practices, policies and procedures of the company and to compare it with existing benchmark within the organization and that is practiced in similar organizations. It also ensures the compliance of the HR department with the goals, plan and policies of the organization. It helps in determining not only the efficiency of the HR policies and practices but also their cost to the organization, thereby to find out the best HR interventions that can increase the firm's competitive advantage. HR audit is considered as an activity undertaken mainly by business giants and there is a need to widen the applicability of HR audit to even small enterprises so that they will also be able to grow consistently. The aim of the study is to recommend human resource audit as a suitable method for evaluating the effectiveness of human resource activities of small scale enterprises for achieving their organizational objectives. The paper aims to develop a comprehensive framework for conducting HR Audit thereby to assist emerging enterprises in identifying the problems in their recruitment, training and development and succession planning process hence to enable them to frame viable solutions to ensure the sustainability of the organization