What is a universal success recipe for any business? Perhaps, it does not exist. But at the same time there are things and factors that contribute to company business success. Effective human resource management is one of such factors. It is wrong to associate business with money, investments, real estate etc. Any company is about all associated with people who work there. Moreover even companies with the best professionals in a certain area may fail to achieve success because these people cannot work together in an efficient and productive way. That’s why nowadays many companies invest huge money into human resource departments. In the end these investments will turn into huge profits.
When Balanced Scorecard was introduced in some companies just after its emergence, there are few people really thought about BSE use in human resource departments, although one of balanced scorecard perspectives directly concerns HR. This is learning and growth perspective which deals with improvement of personnel professional skills, knowledge, organization climate, employee satisfaction etc.
It is really possible to implement balanced scorecard only on a human resource department level. The most common mistake here is non-alignment of HR goals with the company strategy. For example, something that is good for human resource department may not be good for the company in general.
This is where strategic maps can help as they show cause and effect ties between indicators of different categories/perspectives. So, for example if company decides to focus on employee lateness rate or of new hire turnover rate, strategy maps will connect these indicators with other measures and goals of balanced scorecard. Why not control the above mentioned indicators if they influence personal productivity or increase company revenue?
When implementing balanced scorecard in human resource department it is really important to keep in mind that you are dealing with people. Sometimes it is really difficult to measure certain human resource management things with figures. One of such examples is employee satisfaction, as well as organization climate. At a first glance, these things do not influence company financial goals. But if you have a closer look at the strategy map you will see that satisfied employees usually have of the most satisfied customers of which means that by keeping your personnel satisfied you can increase revenue. It is also not a secret that employees tend to work in a more productive way only in the positive organization climate.