Decades of business models have been based on the adage “you can’t manage what you don’t measure” which has never been more relevant. This principle, championed by Peter Drucker, underscores the necessity of tracking and measuring progress to avoid guesswork.

An HR Assessment is a focused analysis of a company’s current programs compared to proven practices and industry standards. It is designed to identify:

• Gaps in compliance
• Inefficiencies and inconsistencies
• Opportunities for growth

The HR Assessment should challenge employers to consider trends and examine underperforming areas. The goal is to move beyond compliance to focus on culture and brand and build a workplace that attracts and grows talent. As the workplace evolves, employers must shift their approach to everything from hiring and onboarding to designing personalized total rewards that reflect employees’ values at different stages of their life journey.

It’s worth noting that an HR Assessment differs from an HR Audit. An Audit tends to be more formal and focused on compliance and mitigating risk. An Assessment takes a more holistic approach, looking at everything to align people’s practices with business goals and employees’ needs.

How are employers looking to HR Assessments to provide strategic insight and guidance?

We are all in the people business. Feedback from an HR Assessment can transform an organization from mere talk to action, laying the foundation for strategic discussions. Developing a compelling, authentic, and emotional Employee Value Proposition (EVP) can set you apart from competitors. This is why the employees you hire will want to work for you. Track, measure, and act on the results.

Employers use HR Assessment recommendations to advance critical organizational initiatives. Long-term projects like succession planning and compensation strategy often benefit from these insights. Leaders sometimes need a nudge to focus on strategic planning, and an HR Assessment can provide the necessary recommendations to initiate crucial discussions. It can also serve as a catalyst for rebuilding an aging HR infrastructure and addressing compliance issues.

The Importance of Regular HR Assessments

Employers should conduct an HR Assessment at least every 2-3 years to get an honest read on current business practices. While daunting, it is a proven practice to engage a third party to take a deep dive into all your programs that touch the function of human resources – all your people practices – and be thoughtful about change.

A holistic approach to evaluating your current HR Program: what is included in an HR Assessment?

An HR Assessment typically covers the following key areas:

• Employee Records/Files
• Regulatory Compliance
• Payroll and Leave Management
• Benefits Administration
• Hiring and Onboarding
• Offboarding and Exit Interviews
• Performance Management and Discipline
• Mandatory Training
• DEI&B Initiatives
• Safety and Employee Wellbeing
• Strategy and Organizational Development
• Leadership and Succession Planning
• HR Technology
• Compensation

What information is required to be shared as part of the HR Assessment?

A detailed Data Request will typically include a sampling of employee files, the Employee Handbook, forms and templates, onboarding/offboarding checklists, new hire packets, job descriptions, I-9s, offer letters, performance appraisals and performance improvement plans, employment applications, job postings, payroll registers, benefit summary plan documents, vendor agreements, EEO-1 reports, employee survey results, organizational charts and strategic plans.

Additional documents may be requested based on specific circumstances – a recent acquisition may warrant a review of relevant company documents. Key stakeholders, managers, and HR Professionals who may have insights into specific functional areas, such as payroll, benefits, safety, etc., may be interviewed.

As part of the process, employers should consider who should participate in the review and include anyone who can contribute a perspective aligned with people’s practices.

The process itself can vary from a few weeks to several months, depending on how the information is used. Using the same approach, a more robust HR Assessment can be expanded to provide useful information as part of an HR Due Diligence project. It can also be a focused review—perhaps designed as an organizational effectiveness project or a project that specifically looks at the structure of a given department.

Ratings and Recommendations provide a road map forward.

Like the scorecard approach, a common rating system helps employers quickly identify and address priority areas. A change in HR leadership is an excellent opportunity to conduct an HR Assessment, capturing institutional knowledge and providing the incoming HR leader with a comprehensive understanding of the current state and actionable recommendations.

If there are cracks in your HR program, it might be time to partner with an HR Consultant to conduct an HR Assessment and gain the insights you need. Request an HR Assessment to unlock your organization’s potential and take the first step toward a strategic and compliant HR program.