What is a supreme value for any company or business? Is it capital, real estate, production equipment and facilities? No! Many business owners tend to forget that people are supreme value for any company. Employees and ordinary managers are those who make profits for business, look for the tracks new customers, create new products and services, make decisions, offer innovations etc. It is very important for any business to have well educated, efficient and satisfied personnel. Recent economic crisis has proved that human resources can really help the company overcome crisis.
Human resource management deals with people. HR managers are looking for best professionals in a certain area, employing them, educate them and use their resource at maximum. At the same time there should be a balance between employee interests and interests of the company. An effective human resource department would span minimal amount of money to fund and the personnel, as well as to keep them satisfied and well educated.
Balanced scorecard system is widely used in human resource management, or in evaluation of its efficiency, to be exact. This system communicates strategic goals with certain actions need to be taken to implement them.
However, it should be noted that evaluation of HR performance is different in different business. For example, it is impossible to use the same metrics in key performance indicators for evaluation of human resource department at an industrial enterprise and web design in company. Of course, there are general guidelines and sets of key performance indicators and their subcategories, but there are still various minor details and subtle differences throughout different business areas.
For instance, when applying balanced scorecard to evaluate HR performance at an industrial enterprise, machinery plant or oil producing company much attention should be given to security of personnel, beer satisfaction with the work and working conditions. At the same time, a retail sales company should focus mainly on motivation of their managers who usually receives percentage from total or personal sales volumes.
HR metrics usually deal with such categories as development and counseling, HR departments, HR ratios, internal communications, personal productivity, recruitment, redeployment and retirement, reward and retaining, telecommuting, training, workers’ compensation, work force, working environment etc.
All these categories contain a number of key performance indicators that must be properly and timely evaluated to assess efficiency of HR department. Of course, some key performance indicators would have a greater important than the others, and one must be very careful when making a choice.