As people are the most important and valuable assets a company has, the human resource management (HRM) has a strategic role to play. However, not always this importance of HRM is seen and human resources (HR) as an organization have in some companies a minor standing.
In order to measure the contribution of HRM to the corporate results a measurement system has to be established. This measurement system, the balanced scorecard (BSC), breaks down the corporate strategy to each level of a company and describes measures accordingly which finally makes the HRM role measureable.
This assignment provides some background information about the balanced scorecard approach in general and for human resource management in particular. The information covers the different perspectives of a BSC as well as some possible measures.
Further on, the performance measurement in HRM is described dealing with an explanation why it is not straight forward and were difficulties are. The chapter deals also with the benefits and how to measure them. As a summary the ad-vantages and limitations in using a balanced scorecard in the HRM are given. The work is closing with the ITM checklist providing a holistic overview of using the BSC approach inside a company and in HRM.
Table of Contents
1. The Balanced Scorecard
1.1. The Concept of a Balanced Scorecard
1.2. The Benefits of a Balanced Scorecard
1.3. The Balanced Scorecard as Measurement based Management Instrument
2. The Balanced Scorecard for Human Resource Management
2.1. HR-BSC – Financial perspectives
2.2. HR-BSC – Business perspective
2.3. HR-BSC – Customer perspective
2.4. HR-BSC – Learning & Growth perspective
3. The Measuring Challenge in Human Resource Management
3.1. Human Resource Performance Management
3.2. How to Measuring Performance in Human Resource Management
3.3. Benefits of Human Resource Performance Management
4. Advantages and Limitations using a Balanced Scorecard in Human Resource Performance Management
Objectives and Topics
This work aims to analyze the integration of the Balanced Scorecard (BSC) into Human Resource Management (HRM) to address the challenges of quantifying HR's strategic contribution to corporate performance. By translating corporate strategy into specific HR measures, the paper explores how to effectively bridge the gap between people management and organizational results.
- Theoretical foundations of the Balanced Scorecard approach.
- Transformation of the BSC perspectives for the HR environment.
- Strategies for Human Resource Performance Management (HR-PM).
- Benefits and challenges of implementing measurement systems in HRM.
- Holistic overview via the ITM checklist for organizational application.
Excerpt from the Book
1.1. The Concept of a Balanced Scorecard
The BSC method is a strategic approach which enables a company to translate their objectives and strategies into implementation. The idea behind is to describe global corporate strategies not only verbally but also to priories and weight them. A BSC consists of four perspectives, the financial, the customer, the business process and the learning and growth perspective which are centered around the corporate vision and strategy as shown in Figure 1.
The concept of a BSC supports to monitor the present performance and tries further to evaluate how the company will be positioned in the future. One key feature of the balanced scorecard is to choose measures and targets by a process of abstraction that narrows down the search space for a measure by informing about a particular objective, for instance the customer one, rather than simply finding a measure for 'Customer' (Balanced scorecard, 17.01.2011).
Four fields in each perspective of the BSC are “scored”:
• Objectives
• Measures
• Targets
• Initiatives
Summary of Chapters
1. The Balanced Scorecard: This chapter introduces the origins and theoretical framework of the Balanced Scorecard as a management and controlling instrument.
2. The Balanced Scorecard for Human Resource Management: This section discusses the application of the four BSC perspectives within the context of HR strategy and organizational management.
3. The Measuring Challenge in Human Resource Management: This chapter analyzes the difficulties of quantifying HR performance and defines the core principles of Human Resource Performance Management.
4. Advantages and Limitations using a Balanced Scorecard in Human Resource Performance Management: This final analytical chapter weighs the strategic benefits of using the BSC in HR against the challenges of implementation and measurement vagueness.
Keywords
Balanced Scorecard, BSC, Human Resource Management, HRM, HR-BSC, Performance Measurement, HR-PM, Strategic Management, Corporate Strategy, Intellectual Capital, Value Creation, Leadership Development, Controlling, Organizational Performance, ITM Checklist.
Frequently Asked Questions
What is the core focus of this work?
The work focuses on utilizing the Balanced Scorecard as a strategic management tool to measure and improve the contribution of Human Resource Management to corporate success.
What are the primary thematic areas covered?
The paper covers the conceptual framework of the BSC, its adaptation for HR, specific HR-BSC perspectives, the challenges of measuring performance in HR, and the pros and cons of this management approach.
What is the main research objective?
The objective is to explore how Human Resource Performance Management can be effectively measured and aligned with broader corporate strategies to ensure organizational growth.
Which methodology is applied?
The author applies a theoretical and descriptive approach, analyzing management models and frameworks to suggest how HR can be integrated into the strategic controlling of a company.
What is treated in the main part of the document?
The main part explains the four perspectives of the HR-BSC, explores the shift from physical to intellectual capital, and details the three levels (corporate, organizational, employee) at which HR performance should be measured.
Which keywords characterize the work?
Key terms include Balanced Scorecard, HRM, HR-PM, Strategic Management, Performance Measurement, and Value Creation.
How does the HR-BSC differ from the traditional BSC?
Unlike the traditional BSC, which is primarily focused on corporate finance, the HR-BSC elevates human resource strategy to the highest level, translating corporate objectives directly into HR-specific operational goals.
What is the significance of the ITM checklist provided in the work?
The ITM checklist serves as a summary tool, providing a holistic overview of how the BSC approach can be applied across various complex business topics to ensure strategic alignment and transparency.
- Citar trabajo
- Matthias Beer (Autor), 2011, Balanced Scorecard. The Challenge of Measurement in Human Resource Management, Múnich, GRIN Verlag, https://www.grin.com/document/233248
