Align HR goals with company strategy
Implementation of balanced scorecard in individual departments and business units of the company is a very tricky thing. On the one hand, such departments as IT or HR do not earn money as they serve the company personnel. On the other hand, they simplify work for employees, organize them and provide them with necessary tools to show better performance. Balanced scorecard can be implemented on various levels of the company. Some top managers prefer to implement balanced scorecard from the top to the bottom while others use pilot projects implemented on lower levels.
Implementation of balanced scorecard in HR department has a number of advantages. The better HR Dept works them of benefits company top management and personnel will have. In the recent decade it has been understood that nonmaterial assets of the company constitute about a half of company capital value. Knowledge and skills are very valuable these days. That’s why proper HR performance will increase capital valley of the company. Such things as organization climate and employees satisfaction influence company performance and progress on the way to implementation of strategic goals.
But the problem is that it often happens HR goals have nothing to do with the company strategy. This is the reason why BSC projects implemented at individual departments, such as HR will IT, fail.
Major BSC terms explained
On the one hand, human resource goals may be quite logical and reasonable for you HR managers but they will conflict with company strategy. When implementing balanced scorecard in human resource department it is imperative that HR managers understand company strategy. Some of them may have allowed into prediction of strategic goals and they will adjust human resource goals accordingly. In such a way, human resource department will move in another direction, although formally their goals and tasks would seem quite reasonable.
This is where strategy maps can help. As known, strategy maps show clear cause and effect ties between indicators, measures and goals. So, if human resource department wants to improve such indicators as employee lateness, everyone must be able to see how this indicator contributes to implementation of goals in the other perspectives of balanced scorecard. Is the most important indicator? Are there any other indicators that directly influence sales growth rate for customer satisfaction? If so then human resource department should look for other measures. It is impossible to implement balanced scorecard in an isolated environment inside the company.
