Evaluate and improve HR processes
and tools
Overview
Managing the HR function involves not only putting processes, procedures,
and tools into action, it also entails implementing a continuous improvement
process. This learning resource outlines methods and tools the HR manager
can use to evaluate the contribution of HR to organisational goals, and to
evaluate HR activities themselves.
Key terms
Audit
Audits are inspections and investigations. Audits can be conducted, for
example, to investigate whether HR standards are being met or to evaluate
the relationship between the HR function and its clients in the organisation.
Audits can be used as planned activities or randomly.
Benchmarking
A management and evaluation approach that allows you compare the state
of your own HR processes against those of other organisations. Often used
to measure the improvement gained from outsourcing.
Evaluation
An overall determination of the success of a program or a strategy.
Goal
A desired result, a goal should be measurable by quantity or quality, has a
timeframe for completion, and is achievable.
Evaluate and improve HR processes and tools: Worksheet
1
2002_329_006 July 2003
HRMIS
Human Resource Management Information Systems; computer systems to
collect and analyse information to assist in the making of timely HR
management decisions, examples are databases, spreadsheets, information
networks.
Objective
Often used to describe an action step within a broader goal, or a short-term
goal.
Performance criteria
The standards for judging how performance has been achieved; focus in on
the process not just the results.
Performance outcome
The outcome or result to be achieved from the performance.
Quantitative evaluation
The measurement of HR activities using numbers or quantities.
Qualitative evaluation
The measurement of HR activities using judgement or opinion.
What to evaluate
The broad areas where HR may be evaluated are:

Do HR processes meet the business needs of the organisation
(whether these are measured by objectives, performance criteria or
performance indicators)?

Do HR processes meet all legal requirements, Industrial Awards and
Workplace Agreements?

Are HR processes are efficient?

Are HR processes are cost effective?
Evaluation approaches
Evaluation approaches – and many of the associated tools – may be broadly
placed in two groups, quantitative or qualitative evaluation.
2
Evaluate and improve HR processes and tools: Worksheet
2002_329_006 July 2003
Quantitative evaluation
These allow you to objectively measure HR activities using numbers.
HRMIS may often be used to collect and analyse this information. Examples
are:

staff turnover reports

absenteeism reports

remunerations reports

questionnaires that allow quantifiable responses (eg numeric rating
scales)

cost/benefit analysis of HR activities

skills testing.
Qualitative evaluation
This allows you to measure HR activities using judgement or opinion.
Examples are:

focus groups

records of performance appraisal

questionnaires that allow open-ended responses (eg to gather
information on values or attitudes)

consultative groups.
If you look at the example below of the evaluation of the IR plan to reduce
absenteeism, you'll see that it uses a mix of quantitative and qualitative
evaluation methods.
Tip
Look at the sample work/life programs questionnaire and report
provided with this resource – you may download it from the same place
where you got this worksheet.
Notice the numeric ratings – they are quantitative measure. The open ended
questions are qualitative.
Benchmarking
Benchmarking is another evaluation approach that allows you compare the
state of your own HR processes against those of other organisations. This is
an activity that is often done prior to outsourcing in order to identify:
Evaluate and improve HR processes and tools: Worksheet
3
2002_329_006 July 2003

what level of service do we have now, and

what level of service do we aim to have as a result of outsourcing?
Read
How has benchmarking developed in the HR field, and how can it be
used?
Greer, C (2001) Strategic Human Resource Management, Prentice
Hall, New Jersey, Ch 9
Rudman (2003) 'Evaluating human resources policies and practices' in
Australian Master Human Resources Guide 2003, CCH, Sydney, Ch
3-080
Also refer to the web research activity on benchmarking in this resource.
Evaluation against goals and objectives
Identifying the goals and objectives in a strategy will provide a guide for
monitoring your progress, and a means of measuring whether you have
achieved what you wanted to achieve.
The following example shows how objectives might be used to evaluate the
success of a recruitment strategy:
Table 1: Evaluation against goals and objectives (2 cols)
Goal:
Achieved?
(yes/no)
Source applicants for the Store Manager position via the Interent
Objectives:
Post the vacant position on an Internet executive recruitment web
site on June 1
Link the Internet recruitment site to the company web page
Post organisational and job information on the company web page
Provide an application form and a CV format on the company web
page
Western Australian State Manager responds within 24 hours to
enquiries from applicants
HRM receives applications (application form and CV only) by
electronic transfer, by June 30
4
Evaluate and improve HR processes and tools: Worksheet
2002_329_006 July 2003
Evaluation against performance outcomes and criteria
Another way of trialling and testing your processes, procedures, and tools is
to use performance outcomes and performance criteria.

A performance outcome states the performance to be achieved;
and

performance criteria are the standards for judging how the
outcome has been achieved – these look at the process.
An example of a performance outcome could be:

Conduct a trial of internet recruitment.
The criteria for judging this could be:

Trial conditions are defined.

A reliable Internet recruitment service is used.

The website for advertising and contacts is identified.

Electronic processing of applications via website is enabled.

Procedure for responding to electronic enquiries is defined.

Procedure for processing applications is defined.
Identifying performance outcomes and criteria is a way of testing your
processes and ability to perform.
Example: evaluation of an Industrial Relations plan against
performance criteria
Another example of a performance outcome for HRM in the Industrial
Relations area is:

Reduce unplanned absenteeism (sick leave) by 15%
Some performance criteria this outcome could be:

Attendance is monitored weekly.

Sick leave forms are introduced.

Sick leave forms are completed by employee and personally handed
to their supervisor on day of return.
Let's see how you could evaluate this IR plan against these performance
criteria:
Evaluate and improve HR processes and tools: Worksheet
5
2002_329_006 July 2003
Table 2: Evaluation against performance criteria (2 cols)
Outcome
Reduce unplanned absenteeism by 15%
Criteria
1.
Attendance is monitored weekly.
2.
Sick leave forms are introduced.
3.
Sick leave forms are completed by employee and
personally handed to their supervisor on day of return.
4.
Compulsory medical evidence is required for staff
who take more than 2 days off at once or 3 separate
occasions in a year.
5.
Staff are rewarded and recognised for excellent
attendance eg no sick days in a year.
6.
Repeatedly absent staff are referred to company
doctor for health assessments
7.
Repeatedly absent staff are referred to Employee
Assistance Program for counselling where warranted.
8.
Training and information sessions are provided for
staff, supervisors and management on this initiative.
Responsibility
Human Resources Manager
Training Officer
All line managers
Completion Date
All 7 criteria are to be met by 15 May
Evaluation

All criteria implemented by due date

All criteria completed as required

HRMIS monthly statistics on staff absenteeism show
11% reduction in absenteeism rate.

HRMIS monthly statistics show wide differences in
rates from department to department – for further
investigation

Weekly attendance reports received from payroll, are
checked by supervisors for action and HR Manager
for follow-up.

Monthly statistics on staff counselling and referral to
company doctor show 10% increase in services.

Feedback from all stakeholders including union is
positive.
Research
Find out what reports can be generated from the HRMIS in your own
organisation. What HR service areas do they cover – recruitment,
6
Evaluate and improve HR processes and tools: Worksheet
2002_329_006 July 2003
performance management, industrial relations, remunerations,
separation/termination?
Audits
Audits are inspections and investigations. Audits can be conducted, for
example, to investigate whether HR standards are being met or to evaluate
the relationship between the HR function and its clients in the organisation.
Audits can be used as planned activities or randomly.
We've provided a sample industrial relations audit tool with this resource –
you may download it from the 'Worksheet' section.
This IR audit tool shows that the audit may cover a number of different
aspects. It shows how an HR audit might be conducted for an organisation's
industrial relations & employee relations activities. Notice that this sample
audit combines quantitative and qualitative information to build up an
accurate picture of the state of industrial relations & employee relations in
this organisation.
Diagnostic checklists
You can conduct an internal audit using a diagnostic checklist of best
practice features and criteria for evaluation.
You can use this checklist to evaluate the processes that your organisation
has in place and the results will point you to any changes that need to be
made. This list isn't comprehensive, but it covers many of the criteria
necessary to evaluate the effectiveness of your processes and tools.
Table 3: Features and criteria to evaluate current HR processes and tools (4 cols)
Best practice
feature
Criteria
Acceptance
testing
Are users aware of the existence of this
process/tool, and do they use it? (This is
formal testing conducted to determine whether
or not a HR system satisfies its users.)
Accessibility
Can your users find this process/tool when
they want it? Do they avoid it if they can?
(Measure the degree to which the document
helps the users.)
Evaluate and improve HR processes and tools: Worksheet
Result
7
2002_329_006 July 2003
8
Best practice
feature
Criteria
Result
Accuracy
Are many mistakes are made with the use of
this process/tool? (Measure size or frequency
of errors caused.)
Adaptability
Is this process/tool versatile? Can your users
apply it to more than one event or situation?
Auditable
Can you record information concerning
transactions performed using the process/tool?
Can a trail be followed—if anything changes,
will the decision-making process be recorded?
Clarity
Is the tool in plain English?
Confidentiality
Does the process/tool prevent unauthorised
disclosure of information?
Dependability
Can you rely on the service this process/tool
delivers?
Error handling
Is this process/tool checked for errors? Can
mistakes be corrected and the system returned
to normal operations?
Latency
Is this process/tool designed to help the user
manage the timing of events effectively?
Maintainability
Can the process/tool be modified to correct
faults, improve performance or other
attributes, or adapt to a changed environment?
Openness
Does this process/tool comply with overall
quality assurance standards?
Robustness
Is this a strong process/tool? To what degree
can it function correctly in the presence of
invalid inputs or stressful conditions?
Safety
Have the outcomes of this process/tool been
widely discussed with stakeholders? Does it
help to minimise risk?
Scalability
Can the process/tool be modified to deal with
different sized problems with ease—be it a
large scale downscaling of staff, or
termination of an individual worker?
Security
Does the process/tool allow sensitive
information to be managed, protected and
distributed well?
Simplicity
Is the process/tool easy to use? Does it have a
straightforward, easy-to-understand design and
implementation process?
Evaluate and improve HR processes and tools: Worksheet
2002_329_006 July 2003
Best practice
feature
Criteria
Tone
Does the language of the document show
consideration for the users of the form, and
encourage them to display courtesy in any
replies?
Traceability
Can a relationship be established between this
and other tools, or between different parts of
the same tool, where there is a cause and
effect relationship?
Training
Are provisions in place for users to learn how
to develop, maintain or use the process/tool?
Vulnerability
Is the tool open to unauthorised access,
change, or disclosure of information and
therefore susceptible to disrupting the
organisation’s services?
Result
Building feedback into your evaluation methodology
Whether you plan for it or not, feedback will form part of your testing,
monitoring, and evaluation procedures for your HR activities.
Feedback can be qualitative and/or quantitative, and can be obtained in
many ways, both formally and informally. Set up a reliable
information/feedback network, and include feedback sources such as:

cooperative employees on the factory/office floor

union delegates

line managers

employer associations

finance managers

professional organisations

government departments and services

HR consultants

HR networking groups.
At times, it might be easy to feel quite baffled by the nature of information
available once an effective network is established. And the usefulness of the
information may vary from issue to issue, so you need to constantly
processing this input for validity, currency, reliability and relevance.
Evaluate and improve HR processes and tools: Worksheet
9
2002_329_006 July 2003
Case study: evaluating remunerations
management
Cottontree Pty Ltd
About 18 months ago, Cottontree Pty Ltd established a consultative group to
look into the value of introducing a benefits program for it's employees.
After a lengthy period of research and discussion, the consultative group
recommended that they had identified three benefits would be highly valued
by the staff. These were (i) a subsidised, on-site child care facility; (ii) a
bus to pick up and deliver employees who started earlier and/or finished
later than regular times; and (iii) flexible working hours for those
employees who worked in areas where the need for overtime was common
during peak production periods.
All three suggestions were accepted in principal by the Board of Cottontree,
on the understanding that the final approval would be conditional on an
examination of detailed 12 month financial projections. The CEO was asked
to present these figures at a Special General Meeting, scheduled for a month
later.
At that meeting, one benefit, the child-care facility, was approved. Although
it was the most expensive by far, the Board felt that it best reflected their
appreciation and would be the most valued by staff-members.
Not surprisingly, the HR manager, committee and the great majority
Cottontree's employees were pleased at the decision.
A number of remuneration committee members volunteered to be part of the
new project team, and enthusiastically recruited others to join them.
An old house directly opposite Cottontrees car park was acquired, renovated
and fitted out under the watchful eye of local council inspectors and opened
for business almost 6 months ago. The centre accommodates up to 25
children, between the ages of 2 years to 5 years. It is well staffed by trained
child care staff. Employees pay a nominal fee, $8.00 per day, for their
children to attend, up to a maximum of three days per week. The centre is
fully-subscribed, and has a waiting list.
Cottontree is heavily subsidising the centre. The centre establishment costs,
even having taken into account the generous support of local businesses and
volunteers, exceeded $1 million. Staffing costs exceed $2,500 gross per
week, and equipment, materials and supplies approx. $300. per week.
Revenue from staff fees amounts to approx. $800 per week.
Source: Mc Bride, T (2001)Managing for Performance Trainup Pty
Ltd; used with permission
10
Evaluate and improve HR processes and tools: Worksheet
2002_329_006 July 2003
Think
After reading the case study above, consider what you would do:
1. What kinds of quantitative and qualitative indicators might you
establish to monitor the performance of a childcare centre?
2. What criteria would you use to determine whether the benefit was (a)
valued by staff, (b) worthwhile to the organisation.
3. What kind of systems might you put in place to monitor the impact
of the centre upon staff morale.
4. How would you go about monitoring the success of the childcare
centre as a benefit?
5. You have been asked to present a 10 minute report to the Board on
the impact of the centre in its first 3 months of operation. What kinds
of information would you include? What sources might you use to
collect information? How will you measure 'success'?
Hint
As you think about your response to each of these questions, go back over
this worksheet. How would you implement the evaluation methods and tools
we have covered?
Evaluate and improve HR processes and tools: Worksheet
11
2002_329_006 July 2003
Parts of this resources are adapted from Terry McBride (2003) Teacher
Guide: Managing Remuneration & Benefits 9795J TAFE NSW, used
with permission; and Open Learning Institute (2003) Learner's Guide
BSBHR506A TAFE QLD, used with permission.
12
Evaluate and improve HR processes and tools: Worksheet
2002_329_006 July 2003