Beruflich Dokumente
Kultur Dokumente
Methodology
Common uses
• Corporate Strategy
• Mission & Vision
• Performance Improvement
Selected References
Kaplan, Robert S., and David P. Norton. The Balanced Scorecard: Translating
Strategy into Action. Harvard Business School Press , 1996.
Kaplan, Robert S., and David P. Norton. “Having Trouble with Your Strategy?
Then Map It.” Harvard Business Review , September/October 2000, pp. 167-176.
Kaplan, Robert S., and David P. Norton. “Measuring the Strategic Readiness of
Intangible Assets.” Harvard Business Review , February 2004, pp. 52-63.
Kaplan, Robert S., and David P. Norton. Strategy Maps: Converting Intangible
Assets into Tangible Outcomes. Harvard Business School Press , 2004.
Kaplan, Robert S., and David P. Norton. "Using the Balanced Scorecard as a
Strategic Management System." Harvard Business Review , January/February
1996, pp. 75-85.
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1. Introduction
There is increasing interest in measuring HR and initial efforts have made use of
a HR scorecard to provide a framework within which to measure. However,
experience of HR scorecard implementation has been mixed. In this article we
provide insights into the reasons why, and outline several key steps that must be
undertaken for HR measurement to be effective.
First of all, one needs to understand the reason for developing a scorecard. For
example, does a wider corporate scorecard necessitate this implementation be
spun-off? Or the requirement of operating metrics on a newly established HR
shared service centre? Is it a means of prioritising and reporting an existing
collection of HR metrics? Or, a result of the new ERP software providing a range
of HR analytics?
Asking these questions focuses on the type of measures required, from basic
data to operating efficiency measures through to corporate value-based metrics –
each perspective having a different focus.
It is not unusual to find that there is potentially more than one layer of metrics. A
common error is to try and package all relevant measures in one scorecard,
rather than a pyramid-layered structure. The HR scorecard – metrics hierarchy
consists of:
# Values based HR metrics linked to corporate based metrics that reflect value-
based measures
# What human capital metrics are included in the general business reporting?
These questions will define the relevance of certain measures in terms of impact
before the next step of defining HR value.
C. DEFINING HR VALUE
However, jumping from efficiency metrics to value-based metrics in one leap can
be too much and thus a progressive move over time may be the optimum
solution.
This is potentially the most difficult step in terms of mapping the touch points –
those where HR involvement or intervention has impact on business
performance. This map provides the base for constructing a hierarchical link of
HR metrics with business metrics (financial/process/customer).
This step is unfortunately the one in which most scorecard enthusiasts begin!
The trick here is to construct a set of relevant metrics that meet with the initial
rationale for the HR scorecard design. The outcome of this stage should result in
some form of draft scorecard framework.
The scorecard is an organic design – one that changes with the business. Thus
this step is most important in continually updating and reviewing the scorecard
framework, ensuring that it continues to report relevant metrics and discontinuing
those metrics that are no longer required. This is sometimes the hardest task.
Following the steps outlined above, whilst by no means definitive, will at least
ensure a HR scorecard design that will be relevant to the business rather than
reflective of a loose collection of HR metrics.
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1. BUSINESS CONTEXT
2. CURRENT HR OBJECTIVES
3. APPROPRIATE HR METRICS
This session established certain ground rules about the types of metrics that
could or should be reported. The team generated an initial list of potential
metrics, which, although comprehensive, focused too heavily on data rather than
knowledge-based measures. This is a common flaw in companies’ HR reporting
– see the panel on Metrics for more detail.
As a starting point, the team considered the standard four-box scorecard design
of Financial, Process, Internal Customer Focus, and People/Human Capital
Management
It was recognised that this should be adapted to meet the company’s specific
requirements. Figure 1 below shows the five measurement dimensions that
emerged.
The ‘Human Capital interventions’ box was included to address the potential
confusion between ongoing reporting metrics (such as sickness absence) and
one-off project reporting around specific human capital interventions, for example
the introduction of a new appraisal process. The ‘Employer brand’ dimension
evolved to meet a gap identified during the following session.
Using the output from sessions 3 and 4, the team began to populate the
scorecard with a number of metrics. A number of iterations were required to get
to a final agreed version.
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At the end of a very full day, the HR team was satisfied that it had achieved a
workable scorecard design, which had direct relevance to the business and
provided them with a much clearer line of sight for HR performance reporting.
It also became clear during the day that some of the stated HR objectives
needed to be reassessed – a task the team has taken away with them.
7. METRICS
The real aim for HR is to produce a scorecard that contains more knowledge-
based metrics that report value or contribution type information. For example,
‘training spend per employee per annum, with a five year trend’. Although still
lacking a value connection, this metric at least supplies the business with useful
knowledge regarding training in the organisation.
Chow, Chee W., Kamal M. Haddad, and James E. Williamson, "Applying the
Balanced Scorecard to Small Companies", Management Accounting, August
1997, p. 21.
Curtis, Carey C. and Lynn W. Ellis, "Balanced Scorecard For New Product
Development", Journal of Cost Management, May/June 1997 Vol. 11, No. 3
Drucker, Peter F., "The Theory of Business", Harvard Business Review, Sep.-
Oct. 1994, p. 95.
Epstein, Mark J. and Jean-Francois Manzoni, "The Balanaced Scorecard and
Tableau De Bord: Translating Strategy into Action", Management
Accounting, August 1997, p. 28.
Kaplan, Robert and David Norton, " Why Does Business Need A Balanced
Scorecard", Journal of Cost Management, May/June 1997 Vol 11, No. 3
Kaplan, Robert and David Norton, Putting the Balanced Scorecard to Work,
Harvard Business Review, September-Oct. 1993, p. 134.