The Human Resources Scorecard: Linking People

Providing the tools and systems required for leading a measurement managed HR architecture, this pregnant book heralds the emergence of gentleman resources as a strategical powerhouse in todays administrations. Three experts in the field outline a powerful measurement system that highlights the indisputable role HR displace play as both a prime source of sustainable competitive advantage and a key driver of set creation.They draw from an ongoing study of nearly 3,000 firms to outline a seven-step solve they call an HR Scorecard, specifically designed to embed human resources systems within a firms overall strategy and manage the HR architecture as a strategic asset. Building on the proven equilibrate Scorecard model, they also show how to link HRs results to measuressuch as profitability and sh atomic number 18holder value-that line managers and senior executives forget understand and respect.The authors argue that human esourcess strategic role begins with designing an HR architecture-the HR function, the HR system, and strategic employee behaviors-that relentlessly emphasizes and reinforces the toolation of the firms strategy. Using compelling examples from a variety of leading companies, they explain how to develop and implement an HR Scorecard in order to both manage the HR architecture as a strategic asset, as well as measure the contribution of that asset to firm performance.Personal suss out The HR Scorecard Linking People, Strategy, and Performance by Dave Ulrich I recently re-read this book and have even higher(prenominal) regard for it now than I did I when I first read it soon after it was create in 2001. Becker and Huselid later co-authored The Workforce Scorecard with Richard W. Beatty. With rigor and eloquence, they examine three separate but cerebrate challenges Perspective (with an emphasis on differentiation), Metrics (and their relationship to strategy execution), and Execution (which holds senior executives and line managers re sponsible for work force success).They suggest that all organizations which successfully meet these three challenges (i. e. those which do it right) have these half a dozen characteristics in common 1. HR professionals spend less time on employee performance than they did five long time ago 2. The relationship between workforce success and strategy implementation defines the ROI of late HR initiatives. 3. Creating a shared mind-set is not taken for granted. . The HR function has a staffing structure that effectively balances the latent hostility between being a strategic partner and delivering efficient and effective HR services. 5. Strategic workforce measures are consumeed and coordinated by a single various(prenominal) or task force. 6. major(postnominal) executives, line managers, and HR professionals consider the results of the measurement system worth the implementation effort.Although it may seem to few who read this brief commentary that will be of substantial value o nly to large organizations, I hasten to reassure them that, after appropriate modifications, what Huselid, Becker, and Beatty recommend in The Workforce Scorecard can ease any organization (regardless of size or nature) to improve the quality of their strategy execution by exploitation the right perspective on the contributions of its workforce to its success, and, by developing the right execution strategy to date that its managers are ready, willing, and able to use workforce metrics to drive billet success.It is measurable to keep these points in mind when reading The HR Scorecard and I strongly recommend that, if possible, The Workforce Scorecard be read in combination with it, preferably but not necessarily afterward. Robert Kaplan and David Norton wrote three articles for Harvard Business freshen up (The Balanced Scorecard, Putting the Scorecard to Work, and Using the Balanced Scorecard as a Strategic prudence System) which led to a series of books in which their insigh ts were developed in even greater depth. fit to Norton who wrote the introduction to The HR Scorecard, in the New Economy, human capital is the foundation of value creation and that up to 85% of an organizations value is based on intangible assets. This presents an interesting dilemma The asset which is most important is the least understood, least prone to measurement, and, hence least susceptible to management. He goes on to commend the co-authors of The HR Scorecard for three specific contributions their development of causal models which illustrate the relationship of HR value drivers with business outcomes and hereby take the Balanced Scorecard to the next level of sophistication their research on the drivers of highperformance organizations to show a framework to decision-makers with which to formulate and implement strategies for human capital growth and finally, their insights into the competencies required by HR professionals, competencies which can enabler an organization to deliver on the promise of its measurement system. In essence, the co-authors of The HR Scorecard come upon and explain linkages indeed the interdependence between and among people, strategy, and performance.Only by understanding these linkages and their independence can decision-makers in any organization (regardless of size or nature) accurately measure the nature, value, and impact of human capital on the bottom line. Moreover, decision-makers can then make much more accurate measurement of each individual in terms of the value she or he adds to the organization and, more importantly, to those on whom that organization depends for revenue. Customers who grease ones palms products, of course, and clients who purchase services but also members who purchase members and benefactors to contribute donations.Here are two some other substantial benefits of establishing and then maintaining a HR scorecard 1. It can guide and inform hiring decisions which ensure that an organizatio n increases its human capital with those to add new value 2. It can also guide and inform decisions concerning the allocation of tangible resources, especially when there are unexpected major developments (either threatening or promising) in the condition organizations competitive marketplace. When concluding their brilliant volume, the authors observe that while much of the work of an HR scorecard is technical, the livery of the Scorecard is personal. It requires that HR professionals design to make a difference, align their work to business strategy, apply the science of research to the art of HR, and commit to learning from constant experimentation.When you create the HR Scorecard, using the approach we describe, you are actually begin italics linking HR to firm performance end italics. But you will also develop a new perspective on your HR function, practices, and professional development. In measurement terms, the benefits will far outweigh the costs. I presume to add two conc luding suggestions of my own. First, that HR professionals use the Scorecard initially to measure their own performance so they can determine how, as individual executives, they can add greater value to their organization. Next, that all others in senior management also read this book as well as The Workplace Scorecard to increase their own understanding of (a) how and why to link people, strategy, and performance enterprise-wide and (b) how to manage human capital much more effectively (also enterprise-wide) when executing strategy.