Evaluate hr performance with Balanced Scorecard System
The 21st century was marked with a rapid development of the Internet and IT technologies which it its turn caused progress and globalization of business. Markets became so tough and businesses so competitive that it is really difficult to survive now, especially taking into account recent financial meltdown. Any business, irrespectively of its type, should be constantly developing. If you think that you will earn money by selling the same amount of products for several years and your business will be prosperous, then you are bitterly mistaken. Such a business will be doing OK during the first months or perhaps a year. After that you need to develop and expand it.
Improving business performance is a must. You do not have much of a choice – either you are becoming better or you are wiped out by competitors. You need to make sure that every cent you have invested in your business is working for you. Inefficient funds allocation will work against you by giving advantage to your competitors.
In this connection evaluation of business performance is a primary goal for any business or organization. Moreover, you need to start with the department which manages personnel. We are talking about HR department. In order to evaluate HR performance you need to measure a number of indicators, commonly known as key performance indicators (KPI). KPIs differ from business to business. In case of HR department these indicators mostly concern cost spend for hiring employees, training them, as well as employee satisfaction and organization climate. Sure, there many KPIs which can of different importance in different companies, depending on their goals and dominating corporate culture.
For instance, it is very important to track changes in cost per hire. If you spend too much money to hire one employee then your HR department does a poor job. This also applies to turnover rate and employment time. If employees do not wish to stay in your company for a long time, then something is wrong. If managers often leave your business, your HR department needs to spend more money to find and train new people.
With the help of Balanced Scorecard system which was specifically designed to measure business performance you will be able to evaluate hr performance, find all weak points in the work of this department and eventually come up with applicable solutions.
Use of Balanced Scorecard systems is strongly recommended for HR managers wishing to improve performance of their department.