Performance, Compensation, and the Balanced Scorecard*

10099 Words Jul 23rd, 2013 41 Pages
The HR Scorecard Refernec By Meghna Haridas
The essay introduces the framework of the HR scorecard, which is modelled after the Balanced Scorecard developed by Kaplan and Norton. The first few sections describe the problems with traditional approaches to viewing HR’s role in business performance. It explains why HR should be looked at as a strategic asset. The HR architecture is then described in brief. It highlights the links between the HR scorecard and the Balanced Scorecard. The nature of HR deliverables including performance drivers and enablers is explained. The seven-step model explains the details of implementing an HR Scorecard. The basic benefits of the HR Scorecard are highlighted. Finally, to highlight the
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But, it is very difficult to imagine measures for these quantities. Hence, in the current state of HR there is a clear rift between what is measured and what needs to be measured. As mentioned in the introduction, the role of HR is no more just administrative. It has a much broader, connected and strategic role to play. But, these statements must be substantiated. The reasons why HR must be considered as a strategic asset must be highlighted. A strategic asset is something difficult to trade or imitate. They are normally a set of scarce, special or even exotic resources and capabilities that bestow a firm its competitive advantage. An unlikely paradox is that the very intangibility of human capital that makes it so difficult to measure and evaluate, also proves to be the one quality that makes it a strategic asset. Consider the difference between being able to align employee efforts with the company’s strategic goals and instead having innovative policies of performance appraisals. The latter is a policy. It is visible to competitors and can be easily copied. The former on the other hand is a strategic move. It is not easy to imitate since it is a very circumstantial effort, which depends on the specific firm, its goals and its people. This proves to be a strategic asset i.e. something that competitors cannot see but that can be utilised to gain a competitive advantage. It is thus
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