What is an HR Scorecard and How it Helps Contemporary Organizations?
The Evolution of the HR Function through the Decades
Traditionally, Human Resources or HR was viewed as a support function whose primary role was to take care of payroll, time tracking, and disputes between the unions and the organizations.
Indeed, in the manufacturing era, the term used for HR functions was personnel management and industrial relations wherein the job of the personnel manager was to ensure that salaries are paid on time, mediating between the unions and the organizations, and otherwise being peripheral to the other functions such as production, operations, sales and marketing, and strategy formulation.
It was only with the advent of the services sector that the role of the erstwhile personnel manager transformed into human resources management and later on, to people management and people enabling and people empowerment.
Note the emphasis on resources and people as the services sector relies on human capital as the key asset and hence, the HR managers were expected to contribute to strategic goals and objectives.
In other words, the HR function evolved and transformed into one where it was no longer peripheral or a support function, and instead of times when human resources are viewed as sources of sustainable strategic advantage, the role of the HR manager was to aid and enable such resources to contribute effectively and meaningfully to the organizational strategies.
What is an HR Scorecard?
Concomitant to these developments was the evolution of the initiatives such as HR Scorecard which are tools to measure how well the HR function is aligned to the overall strategic goals of the organization.
In other words, HR now was expected to align its recruitment, compensation, and employee retention strategies to the organizational strategies.
What this means is that in contemporary organizations, the HR managers have a seat at the leadership table or to put it simply, they have to be aligned with the larger organizational strategies.
Towards this end, the HR Scorecard works by providing decision-makers with data and inputs about how much the employee recruitment and retention processes cost and what are the benefits of the same.
For much of the 20th century, it was commonly understood that these costs are part of the overall organizational costs and there was no way to measure the benefits of such expenses in tangible ways.
In other words, what this means is that an HR Scorecard provides the organizational leaders with metrics and data in tangible terms about the payoffs and the benefits from HR processes and activities.
How the HR Scorecard Works
How the HR Scorecard works is that by drawing up the budget for the HR function, key cost items and overheads are identified and once done so, then such costs are translated into how much benefit that they are bringing to the overall organization.
For instance, if high potential and highly talented employees are hired, the costs of hiring and retention are then measured and stacked against the likely benefits that such activities bring to the organization.
Apart from this, the real usefulness of HR Scorecards is that it gathers metrics about activities and processes such as training and then identifies the likely benefits in terms of result oriented and metric-based training outcomes.
In other words, by keeping score of which training cost how much and how useful or relevant it was in addition to how much benefit that such training meant to the attendees, the HR Scorecard provides the leadership and the HR managers with measures and metrics on the value that is being created to the organization.
Thus, HR scorecards are indeed useful and relevant in contemporary organizations that take human resources seriously.
What are the Benefits of HR Scorecards?
The key benefit or the relevance of tools such as HR Scorecards is that it aligns the broader organizational strategies with the HR strategies and the convergence of organizational goals with the HR goals brings the HR function in line and tune with the overall organizational ecosystem.
For instance, how this works in the real world is that if an organization identifies superlative customer service as a strategic goal, the HR scorecard helps in measuring the benefits of initiatives such as training the customer service representatives and the associated staff costs involved in hiring and retaining such key personnel.
At the end of the year, the benefits of the initiatives as measured by customer feedback surveys are tallied to the costs of the initiatives so that organizational decision makers and more importantly, the HR Managers have an idea about the effectiveness and efficacy of their hiring and retention strategies and their usefulness and relevance to the broader organizational goals and objectives.
In other words, the HR function is no longer a silo that stands apart in splendid isolation and is instead, aligned with the overall organizational ecosystem of goals and objectives.
Aligning HR and Organizational Strategies
Thus, the convergence of HR and the organizational strategies creates synergies for all the organizational stakeholders.
Indeed, while it can be argued that the HR Function was always expected to be aligned to the overall organizational imperatives, the key benefit that the HR Scorecard brings is that it provides data and metrics to support its qualitative narrative.
In other words, the HR Scorecard operates through data-driven and metric-based measurement and tracking of the progress and the benefits of the various initiatives.
This data based approach combined with an objective CBA or Cost-Benefit Analysis means that decision-makers can identify where costs can be cut or where optimization and rationalization of benefits accrued from such costs can be done.
To conclude, an HR Scorecard represents an entirely new way of aligning the HR and the wider organizational goals and objectives.
|❮❮ Previous||Next ❯❯|
- Hiring & Firing of Workers: Perspectives
- What to do if You are Laid Off from Job
- Termination and Outplacement
Authorship/Referencing - About the Author(s)
The article is Written By Prachi Juneja and Reviewed By Management Study Guide Content Team. MSG Content Team comprises experienced Faculty Member, Professionals and Subject Matter Experts. We are a ISO 2001:2015 Certified Education Provider. To Know more, click on About Us. The use of this material is free for learning and education purpose. Please reference authorship of content used, including link(s) to ManagementStudyGuide.com and the content page url.
- H R Management - Introduction
- Importance of HRM
- Scope of HRM
- Various Processes in HRM
- What is Human Resource Planning ?
- The HRM Function
- Functions of a Human Resource Manager
- Staffing Role of the HR Manager
- Role of HRM in Leadership Development
- Role of HR in People Empowerment
- Talent Management and HRM
- Management of Contractors
- Performance Management as a HR Management Concept
- Successful Performance Management
- Hiring Strategies
- Social Media Profiles for Hiring Decisions
- Importance of Background Checks
- Retention Strategies
- Strategic HRM
- Global HRM
- Personnel Management vs HRM
- Managing Employee Performance
- Performance Appraisal Process
- Performance Appraisal Interview
- Managing Employee Relations
- Employee Rewards and Recognition
- Variable Pay
- Diversity in Organizations
- Managing Workforce Diversity
- Workplace Health and Safety
- Workplace Safety Programs
- OSHA Safety Manual
- HR Challenges
- Human Resource Audit
- Hiring in Shadow of Stagnating Growth
- The Challenges of Managing Attrition
- Employee Separation Process
- Tips for Pursuing a Career in HRM
- Role of HRM in Recessionary Times
- People Manager vs. Project Manager
- Use of Contract Staff & Temp Workers
- The Necessity of Drafting Proper and Foolproof Employment Contracts
- Importance of Vacation Planning
- Hiring & Firing of Workers: Perspectives
- What to do if You are Laid Off from Job
- Termination and Outplacement
- Emotional Intelligence for Professionals
- Assigning Key Responsibility Areas (KRAs) to Employees
- Role of HR in Performance Appraisals
- HR Policies and Procedures Manual and Employee Handbook
- Managing Downsizing in Organizations
- Managing Attrition in Organizations
- Rise of the Temp Jobs and the Freelance/Sharing Economy
- What is Blind Hiring and Its Implications for the HR Profession
- How Human Resource Managers should Manage Ethical Issues and Ensure Compliance ?
- Issues Related to Human Resource Management in the Hospitality Sector
- Human Resource Management in the Times of Emerging Digital Economy
- Human Resource Management in the Age of Acceleration
- How to Manage Star Performers and High Achievers
- Actualizing a High Trust Organization
- HRM Strategies for an Increasingly Complex, Uncertain, and Volatile World
- How Human Resource Managers can deal with Difficult Employees
- Why Human Resource Management Must Change for the Coming Robotics Revolution
- How Silicon Valley Firms are Implementing Innovative Human Resources Policies
- Effective HRM Strategies to Smoothen and Sweeten the Downsizing and the Layoff Process
- How HR (Human Resources) Function Can Save Time by Automating Routine Tasks
- How HR Managers Can Help Employees Avoid Burnout and Manage Stress
- Human Resource Management Strategies to Diversify the Workforce
- What is an HR Scorecard and How it Helps Contemporary Organizations?
- How Using the HR Scorecard Creates Long Term Value for Organizations
- How Technology Can Help in Collection of Metrics for the HR Scorecard
- HR Scorecard: Aligning People, Strategy, and Performance
- How Using the HR Scorecard Can Address Organizational Dysfunction
- Human Resource Management Best Practices in Contemporary Organizations
- Using HR Scorecard with Analytics to Actualize Next Generation Performance
- How the HR Scorecard Helps Actualize Cross Functional Excellence in Organizations
- How the HR Scorecard can Help Gig Economy Firms to Manage Freelancers Better
- How the HR Scorecard Helps Organizations to Actualize Change Management Initiatives
- How Innovative HR Policies boost Employee Productivity and Organizational Effectiveness
- Changing Recruitment Strategies of Corporates and Tips to Get Hired
- What is Social Mirror and How it Determines Individual Success in Career and Life
- What Do Hiring Managers Look for in Applicants when Making Hiring Decisions
- Why the Future of Work is Virtual, Gig Based, and Cognitive and its implications for HR
- Why HR Managers Must Enforce Data Security and Information Protection Policies
- Why Corporates Must Have Wellness Managers as well as HR Managers
- What is Employee Ghosting and How HR Managers and Organizations Can Deal with it
- The Increasing Popularity of Corporate Wellness Programs and What HR Can Do
- What Experienced HR Managers Watch Out For When Recruiting Candidates
- The Importance of Data Driven Analytics and HR Scorecard Dashboards for Corporates
- What Hiring Managers Look Out For During the Recruitment and Selection Process?
- The Growing Popularity of Flex Work and HR Strategies to Deal with It
- What the Case of Amazon’s AI Powered Recruitment Tool Means for Other Corporates
- Pay Cuts vs. Lay-Offs
- Game Changers or Slave Drivers? Human Resource Managers in the Gig Economy Firms
- Preparing for the Workplace of Tomorrow: Some HRM Strategies for the Digital Age
- The Managerial Challenge: Using Early Warning Systems to Spot Signs of Trouble
- Top HR Trends for 2019: Technological Convergence and Smarter HR Management
- How Should HR Managers Deal With Occupational Hazards at the Workplace?
- How HR Managers Must Deal with Legal and Regulatory Challenges in Organizations
- How HR Managers Must Address the Pay Disparities and Pay Gaps in Organizations
- How HR Managers can Make the On-boarding Process more Pleasant and Effective
- Why HR Managers Must Treat the Exit Interviews as Feedback and Learning Experiences
- The Importance of Due Diligence in Human Resource Management Processes
- The HRM Challenge: Managing the Millennials Entering the Workforce
- The Future of Human Resource Management in an Agile Driven and Automated World
- The What, Why, and How of the Difficult Decision to Fire Employees in Organizations
- How Using Blockchain Can Transform the HR Function and Change the Way it Works
- Corporate Corruption and the HRM Function: Legal, Ethical, and Moral Perspectives
- How Predictive Analytics Helps HR Managers Make Better Hiring Decisions
- Skills that the HR Professionals Need to have to be Successful in the Present Times
- The HRM Challenge: Promoting Diversity and Inclusivity in Illiberal and Charged Times
- Role and the Importance of Human Resource Managers in Recessionary Times
- How Blockchain can Help Human Resource Managers in Efficient Management
- HR Professionals and the Law: The What, Why, and How of Awareness of Laws
- Is the European Model of HRM Better than the American Model? Some Perspectives
- The Staffing Challenge in MNCs: Expatriates or Locals in Overseas Locations
- The HRM Challenge: Managing Opinionated Employees in Polarized and Divisive Times
- Why Auditing of the HR Function is Necessary and Important in the Present Times
- The Role of the HR in How Corporates Can Win (and Lose) the Global Race for Talent
- The Changing Nature of Employment and Impact on Professionals and Societies
- Fixing Fraud and Biases in the Recruitment Process and Making it Fair and Transparent
- HRM Strategies in Non Profits and How Similar and Different are They from Corporates
- Organizational and HRM Strategies for Virtual Workplaces and Remote Workforces
- The Role of Feedback in Enhancing Employee Performance and Productivity
- The Role of Monetary and Non Monetary Incentives in Enhancing Employee Performance
- Will Hire and Fire at Will Labour Laws Work in the Indian Socio-Economic Context?
- How Insights from Behavioural Science Can Help Corporates in People Management
- What is Ghosting and How it Disrupts the Hiring Process and Ways to Tackle this Menace
- How Staffing Agencies Need Better Regulation in the Corporate Ecosystem
- How Corporates Have to Let Go of Legacy Employees in an Empathic, Yet, Firm Manner
- Designing an Effective Pay and Perks Package across the Organizational Hierarchy
- Why Do Some Excel in the Interviews, But, Fail on the Job and How HR Can Fix This?
- Why Technology Can Diminish the Role of HR Function, but, Not Eliminate It Altogether
- The Challenges of Recruiting and Onboarding Remote Employees in Virtual Workplaces
- The Importance of Values in Human Resource Management in the Post Pandemic World
- Why We Need Employee Friendly Laws and HR Policies in the Post Pandemic World
- What is Second Chance Hiring and Why It Matters in the Present Times of Distress?
- Pandemic and Lay off: Putting People over Business
- The Hype and Realities of Networking in an Interconnected World and Leveraging Them
- What is Blind Hiring and How it Promotes Diversity and Inclusivity Efforts in Corporates
- What is Great Resignation? What can be done to Address the Mass Attrition Trend
- Why are American Millennials Burning Out and Quitting Jobs in Record Numbers?
- As American Corporates Order Employees Back to Office, What Are the HR Challenges?
- What Is Quiet Quitting, Why It Matters, And How Is It Impacting American Corporates?
- As Tech Firms Layoff Thousands, Is the Party Over and What It Means For Indian IT
- After Quiet Quitting Comes Quiet Hiring! What It Is, And Why It Would Be Trending In 2023!
- Quiet Hiring vs. Traditional Hiring: A Comparative Analysis and What Works When and Why
- White Collar American Workers are burning out More Than Ever! Here are the Reasons Why!
- Who are Boomerang Employees?
- Why is Everyone Talking About Artificial Intelligence Suddenly and How it Matters to All of Us?
- Heres Why Businesses in the United States are Finding it Hard to Hire Workers
- HR Challenge: Both Ageism and Youngism are Forms of Discrimination at the Workplace!