HR Scorecard

HR

Scorecard measures the effectiveness and efficiency of the HR functions in producing those employee behavior that are important for a firm to achieve its strategic goals. The HR Scorecard is a system of measurement

Elements of HR Scorecard
Workforce Success

Right HR Costs
Right Types of HR Alignment

Right HR Practices]
Right HR Professionals

Creating a HR Scorecard
Defining the Business Strategy Design the HR Scorecard Measurement Periodically Evaluate the Measurement System

Outlining the Companys Value Chain

Identify Relevant HR System & Policies

Identify the Strategic Organizational Outcomes

Identify the Required Workforce Competencies & Behavior

Measuring HR Alignment
HR Competencies HR Professional & General Managers HR Role External and Internal Views

Employees Strategic Focus Effective strategy Execution HR as Strategic Asset

HR Systems Aligned to HR Deliverables

Strategy Implementation Emphasized & Balanced

External

Alignment Internal Alignment

Assessing Internal Alignment

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Measurement systems can serve a number of purposes .They can guide management of HRs contribution to strategy implementation. They also provide a scorecard that validates HRs contribution to firms performance. For managers who want to quickly assess the potential of their firms HR system, as a strategic asset, a simple measure of the internal allignment of that system can help.

CASE OF STILWELL MANUFACTURING

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Stilwell is a diversified manufacturer, with an international production and distribution system. While the company has been very successful in recent years(it generated $2 billion in revenues, in 2000), the senior management team has developed a new strategic plan for the business that forecasts double-digit increase, in both revenue and cash flow, over the next 3 years.

 To achieve their two optimistic financial goals Stilwells top management team had identified Four Strategic Drivers o Shorten new-product development times o Enhance customer focus and responsiveness o Enhance productivity o Develop and successfully manage several joint ventures.

External Alignment
HR system of company should be designed only after the firms strategic drivers and relevant HR deliverables that contribute to those drivers are analized. The HR Scorecard includes a set of measures, designed to assess the degree of external alignment between the HR system and the requirements of the firms strategy implementation process

Scale & Perspective/ Basis of Assessing External Alignment

Scale: If degree of alignment is considered important in organization(eg,. During a large chane initiative). One would want to choose a measurement scale Perspective: Refers to individual viewpoints.

System Alignment Map

Internal Alignment
Elements of HR System

External Alignment
Skills Motivation Opportunity

External Alignment
HR Deliverables, Large strategy Map from 3 of Strategy Implementation Model

The map offers several important benefits:

It Lets to Visualize alignment It incorporates Perspectives from the Entire Organization It measures Alignment Systemically and Yield Action Steps It is Relatively Easy to Administer It is based on Best Scientific Principles of Measurement