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Project HRSC: A Business Performance Scorecard for HR
Measuring The Performance that Matters the Most
:: completed list main ::
The HR function is at center stage as never before. Whether the challenge is
recruiting, retaining, developing, organizing, or compensating employees, HR
leadership has become essential to business success. Yet the most common
measures of HR performance typically focus on administrative activities, not
business outcomes. The HR Business Performance Scorecard provides a template
that links HR support and change initiatives directly to important business
results.
By measuring performance and progress in HR's strategic alignment,
employee capabilities, overall organizational capability, organizational
learning and innovation, and HR's internal operational efficiency, the Scorecard
helps both HR staff and senior business executives stay focused on key business
results and the HR work that supports them.
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Measure business outcomes, not HR accomplishments. It is far too easy for most HR professionals simply to assume that what they do
has business value - yet all too often even high-quality HR effort has little or
no long-term impact on critical business needs. HR attention must be focused on
the few key business challenges that are uppermost in senior management's minds.
The success of HR can only be measured in terms of how well it contributes to
outcomes that matter to customers, shareholders, and senior executives.
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Start with business needs, not HR perspectives. Too many HR organizations attempt to measure their strategic impact by starting
with efforts that are important to HR - metrics like turnover, retention, cost
per employee hire, and so on. While these factors may be important to the
business, they often are not, and starting with what is important to HR is an
"inside-out" trap. Instead, start with business priorities, identify how HR
efforts can help achieve those priorities, and only then determine how to
measure success and progress.
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Focus measurement on the people capabilities of the business, not on the functional performance of the HR organization.
Again, what matters is how well staffed the larger enterprise is, and how
capable it is of satisfying customers at reasonable cost. Of course, it is
important to have a high-quality, professional HR organization, but that is only
a means to the end of having world-class talent throughout the organization.
This Re.sults® report describes a new approach for
linking HR activities and initiatives explicitly to important business outcomes.
It describes both a framework and a process for developing clear indicators of
how well HR is supporting and contributing to the business as a whole.
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