The importance of HR management can be hardly overappreciated. The recent economic meltdown showed that qualified personnel is the most valuable intangible asset for any company. Business may lose capital, real estate, money and customers. But as long as company has loyal and professional employees you have chances for survival.
HR departments are working in all major companies, especially large ones. Human resource management approaches are more or less all the same throughout different businesses. However, different business areas required different approaches, taking into account specific nature of the work, organization structure and company strategic goals.
As any activity in the company, human resource management efficiency should be constantly evaluated. Balanced scorecard is an ideal tool to fulfill this task. This article focuses on implementation of balanced scorecard in evaluation of HR efficiency in accounting.
First and foremost, it should be said that accounting is pretty much about reporting on company financially activity. For this reason, accountants and finance specialists should be very attentive when keeping financial documentation. When implementing balanced scorecard in HR evaluation for accounting business the following indicators are recommended.
- Error free documentation. Any minor mistake in financial and accounting reports may cause serious problems for a company. Even if this mistake concerns a few dollars it will be impossible to submit such a report to controlling government or taxation bodies, say apart of mistakes in hundreds and thousands of dollars. HR department should track the rate of error free documentation and encourage accountants and finance specialists to lower it. Financial reports free of mistakes will also improve company image in the eyes of government officials and representatives of taxation offices. This indicator may be measured once a month, quarter or a year, depending on what kinds of reports are submitted.
- Employee loyalty. Accountants and finance specialists have access to sensitive and confidential information about company transactions. This information may be used a cane as the company by competitors. So, it is very important to have loyal and devoted accountants and finance specialists who love working for the company and who will never use this information with evil intentions. It has been proved that managers and finance specialists loyal to a company have the most loyal customers, which is always good for a company. It is better for a company to create suitable working condition to improve employee loyalty than to suffer enormous losses due to loss of confidential information.
- Invoice accuracy. Most businesses either sell products or services, and invoices are used in prepayment procedure. The wrong invoice would cause the wrong payment. It will be quite inconvenient to cancel payment and resend the amended invoice. This takes time and possibly money. That’s why it is imperative to make out invoices so that the company timely receives money for their products or services. Invoice accuracy can be measured, for example, once a quarter. Employees should be encouraged and motivated to keep invoice accuracy at the highest possible level.
Of course, this is not the full list of key performance indicators in accounting HR. But these KPIs can be effectively used by HR managers and large companies.