Friday 19 December 2008

HCM in the Balanced Business Scorecard / Strategy Map


You can see the separation of the people and business management systems in most businesses' strategy maps.

Most, in fact very, very nearly all, show linkages between objectives in the internal process, customer and financial perspectives.  But there are very rarely connections between people and objectives in the other quadrants.



Why is this?

It's because what we do in HR, and the deliverables of this activity, ie human capital, affects everything else we do in the business.  Eg having engaged people doesn't just support one objective for operational success, it supports all of the objectives within 'internal processes' and also directly informs objectives relating to customer and financial success.

They're two different systems, see.

But this only works if you think about human capital as the output of what HR does, ie of the people management system.  Still think human capital is just unnecessary jargon?



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  1. Jon, what if you take each of those bubbles and draw a line back to HR to show the implications for the type of HR that we will be doing?

  2. If the strategy mapping process is done well it will identify the key talent dependencies within the strategy. The leardership team, with guidance from the CHRO, agrees the objectives and measures that will help the organization monitor and manage those dependecies. From there HR should take the lead in identifying the practices, programs, and processes that will help the organization achieve it's key talent objectives.

    For example, if a retail organization has a strategic objective to grow through opening new stores, then a people dependency is having new staff in place in time for a store to open on time. Appropriate measures of success may be time to start and first year turnover.

    HR then has the responsibility to design, deliver and manage talent acquisition and deployment processes that enable the organization to recruit, hire, onboard and retain the right people.

    Two key elements of balanced scorecard implementation are leadership team shared accountability and collaborative decision making. Every action and objective identified in the strategy map requires the whole organization's commitment and effort. But each area requires a functional steward - HR is the steward of the talent area.


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