Balanced Score Card In Hr

Balance Score Card Human Resource Management Project By: Sanjay Sinha PGDM 3rd Sem

Introduction 

It was originated by Dr. Robert Kaplan (Harvard Business School) and Dr.David Norton in 1992 as a performance measurement platform that added strategic non-financial performance measures to traditional financial metrics to give managers a more 'balanced' view of organizational performance.

Background Earlier we focused on Financial measures like:  Return on Capital  Operating Income  Sales Growth  Fund Flows  Financial Statements  Balance Sheet  Ratios & Analysis

Background But we did not lay any emphasis on Performance measures like:  Customers  Suppliers  Employees  Internal Process  Learning & Growth

Advantages 

Balance score card is a system by which we integrate financial measures of past performance and it introduces the driver of future performance ie Customers, Process, Human Resource.

Importance     

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Gives Competitive Advantage to the Organization Improves Organizational Performance Performance is documented Increased Focus on Strategies and Results Aligns Organisational strategies with the work people do on a day to day basis Improves communication of the Organization Vision and Strategies

How Performance is Measured 

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Vision, Goals, Objectives and Strategies are signaled downwards from top to the bottom in the organisation. These signals should be clear and should have value. Users should understand the signal and sends it further down the organisation. The users should be involved in its development. Feedback and performance report should travel from bottom upwards to the top.

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How Does it Works in HR

Methodology Mission

Clarify mission and vision statements

Develop Strategic goals

Sub goals

Vision

Strategic goals

Financial Sub Goals

Derive Sub Goals

Maps Sub goals to each quadrants of the Balanced score card

Customer Sub Goals

Internal Business Sub goals

Learning & Growth Sub Goals

How to use Balanced score card Clarifying and Translating The Vision and Strategies Clarifying the vision Gaining consensus

Communicating and linking Communicating and educating Setting goals Rewards for performance

Balance Scorecard

Planning and setting targets Setting targets Strategic initiative alignment Resource Allocation Establishing milestones

Strategic Feedback and Learning Articulating the shared vision Obtaining feedback Strategy review

Framework

Financial Perspective in HR 

Strategic Objectives

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Objective:-Reduce HR related costs   

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Reduce turnover Cost Reduce absenteeism Reduce workers compensation cost Engage staff to identify areas of opportunities.

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Measures   

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Turnover rates Absence Rate Workers compensation rate Lost work day rate

Internal Perspective in HR 

Strategic Objectives

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Objective: Improve employee satisfaction 

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Continue efforts to brand the organization as the great place to work Effective Strategies within the organisation to improve satisfaction.

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Measures 

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Employee Opinion Survey Turnover data Identify new process of growth and development of the organisation

Customer Perspective in HR 

Strategic Objectives

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Objective: Improve Customer satisfaction  

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Define Customer Service Validate customers expectations Enhance service standards Evaluate results from Survey

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Measures   

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Customers satisfaction Retention of Customers Acquisition of new customers Profitability of the the organisation

Learning and Growth Perspective in HR 

Strategic Objectives

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Objective: Improving HR personnel knowledge & skills in key areas   

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Identify skills Measure gaps Develop learning tools and plans Develop training Programs

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Measures 

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HR skills learning plan complete Courses conducted Validate HR competency level Enhancing IT and systems

Summary 

Balance scorecard is a tool which tells us the knowledge, skills and systems that employees will need (Learning & growth) to innovate build and adopt the right strategic capabilities and efficiencies (Internal process) that delivers desired value to the market (Customer) which will eventually lead to the accumulation of shareholder value (Financial)

Thank you