Efficient human resource managers are always sought for. The problem is that despite its popularity human resource management proves its efficiency only in case a number of conditions are observed. Besides, all HR campaigns and measures may fail in case relevant goals of this business unit are not aligned with company strategic aspirations. Sure thing, HR has three main goals – employment of personnel, education of personnel and retention of personnel. However, each goal should be somehow related to strategic goals. If a company spends certain amount of money to hire a well qualified employee, it should definitely understand why it is doing so and how such an employee can benefit the company. The same concerns education. Some companies educate personnel just because they “have to.” Trainings have become a modern trend these days. This is a totally wrong approach. Training of personnel should answer the question “How will employees use obtained knowledge in practice?”
Balanced Scorecard will certainly help top managers optimize HR performance and align HR goals with strategic goals of the company. The beauty of BSC is that it can be used on different managerial levels. Thus, a HR BSC can be part of a huge corporate BSC and all HR goals and measures will be related to correspondent goals and measures on a larger company scale.
A special attention should be paid to all aspects of HR performance, from hiring to education. HR management requires funding as it needs money to hire and educate personnel. Thus, money needs to be spent efficiently. The 4 categories of BSC and the underlying indicators will certainly help top managers obtain necessary information on what needs to be improved in HR to implement company strategy.
It may turn out that according to strategic goals it is more profitable for a company to hire college graduates and then invest some money into their education rather than hire seasoned professionals who would require adequate pay.
The learning and growth perspective in HR scorecard will evaluate efficiency of investments in professional skills of employees. Moreover, the KPIs will measure how efficiently employees use acquired skills and whether or not they are satisfied with training sessions.
Cause and effect ties in the HR BSC will help even ordinary HR managers better understand BSC concept and make their own contribution to implementation of strategic goals, both in the HR department and on the company level.