HR balance scorecard for effective workforce management

There is no argument that good and proper use of performance metrics can help organizations to better understand its overall efficiency and effectiveness – whether in terms of people, processes or programs. However, many leading organizations do not just stop at collecting and analyzing performance data. They go out of their way to use performance as a driving tool to improvements and turn strategy into successful action. Simply put, leading organizations use performance metrics for effective management.

Usually, leading organizations that differentiate themselves from all other organizations have measures that are well understood and agreed upon by managers; associate strategic and operational measures together; regularly update their scorecards; balance financial and non-financial performance measurements and effectively relay measures and its progress to employees.

Over the past few years, the balance scorecard has become an important measurement system that is being used in many organizations to measure management performance. This tool translates a company’s goals and objectives into a set of comprehensive performance measures that give a strategic framework for effective management system. Basically, the balance scorecard is a visual representation of the company’s strategy. It is designed to measure the success of an organization, department or business unit, balance short term and long term plans and various success measures such as customer, financial, internal business processes as well as Human Resources development and systems. Moreover, the balance scorecard is also a means of merging strategy with action measures.

The Human Resources department plays an important role in measuring an organization’s performance by indicating the extent of employee contribution to the organization. The HR department should view the rest of the entity as a customer. This can be achieved by developing human capital in the organization, which can be measured by putting up a HR balance scorecard.

The HR department is mainly responsible for workforce management and it can also play a crucial role in the financial performance of the organization and the quality of customer service as well. Workforce management constitutes the recruitment and selection process, employee compensation and benefits, turnover issues and information resource concerning HR issues. They can also address the organizational needs by evaluating different departmental goals and strategies and see how the department itself can meet the goals of the other departments in terms of employee issues.

When implementing an effective HR balance scorecard system, there should be strategic focus, assessment, change in planning and implementation and continuous improvement. The assessment phase involves several step such as audit measures, developing new necessary measures, application of new measures, analysis and report. Moreover, implementation of track metrics and revisiting scorecard cascade should also be taken for continuous improvement as well.

However, there may be a number of barriers to developing an effective performance measurement system. These include unclear objectives and informal feedback systems, excessive measurement systems in the organization or deep-rooted management systems. The HR department should be able to deal with these barriers to effectively implement the balance scorecard.

The HR balance scorecard system is a major tool for many organizations. A solid performance measurement foundation promotes an organization that is well disciplined, better management and more successful.