itu/bdt workshop on hr management tools and practicesitu/bdt/hcb sept 2008 hr management tools and...

HR Management Tools and PracticesITU/BDT/HCB Sept 2008 Lecture12 slide 1

ITU/BDT Workshop onHR Management tools and practices

Sofia, Bulgaria, 26 – 28 November 2008

Lecture 8:Practicing Balanced Scorecard (AFR + CIS cases)


The Rationale for The Rationale for Balanced Balanced ScoreCardScoreCard (BSC)(BSC)

The BSC is largely a change programme to a High performance workThe BSC is largely a change programme to a High performance working culture. ing culture.

It has to be firmly supported by other business led interventionIt has to be firmly supported by other business led interventions s

The BSC is a devolved process in which the principal actors are The BSC is a devolved process in which the principal actors are the line.the line.

It is a 360 degree process with a holistic approach that aims toIt is a 360 degree process with a holistic approach that aims to look at all the facets look at all the facets of the business.of the business.

BSC can reflect on the strategic focal points of the company thrBSC can reflect on the strategic focal points of the company through the following ough the following activities: activities:

• Development of information architecture

• Alignment of bonuses and other incentives with new system

• Drawing on outside resources (tracking competition and benchmarking)

• Designing an integral system to ensure that the other three activities take place


• Key Objectives setting done at corporate level

• Departmental objectives set

• Departmental Heads cascade the objectives to individuals within the departments

• According to grades objectives or performance standards and deliverables are set

• Some objectives are weighted

• Performance ratings frequently based on a scale of 1 to 4

1 – Poor 2 – Satisfactory 3 – Good 4 - Excellent

• Average rating/score calculated

• Ratings are linked to certain percentages for increments

• At the time of appraisal, individuals identify areas where they want to develop in

but this is not scored

Highlights of Traditional Highlights of Traditional Performance Management SystemsPerformance Management Systems


Financial

The traditional systems cannot be balanced and do not focus The traditional systems cannot be balanced and do not focus on all the areas that are important to a businesson all the areas that are important to a business

Financial Customer

Learning &

Growth

Individual level•Mainly focused on internal processes

Corporate level•Mainly focused on Financials

Customer

InternalLearning

& Growth

Internal

Financial


Most frequent weaknesses of traditional Most frequent weaknesses of traditional performance management systemperformance management system

Different appraisal formsDifferent appraisal forms for different grades which results in a lack of consistency for different grades which results in a lack of consistency

within the systemwithin the system

Some peopleSome people’’s objectives are dependant on the companys objectives are dependant on the company providing certain facilities. providing certain facilities.

Failure or delay in providing them may impact the performance ofFailure or delay in providing them may impact the performance of the individuals yet the individuals yet

these are circumstances beyond their control. these are circumstances beyond their control.

Despite undergoing thorough training on completing the appraisalDespite undergoing thorough training on completing the appraisal forms some staff forms some staff

members end up with completely members end up with completely different formsdifferent forms. On the other hand some submit . On the other hand some submit

electronic copies and others hard copies. This delays the HR depelectronic copies and others hard copies. This delays the HR department in inputting artment in inputting

the data in its data base.the data in its data base.

Some give Some give yearly objectivesyearly objectives while others prefer while others prefer quarterly onesquarterly ones this means there is this means there is

no consistency in how people are measured.no consistency in how people are measured.

Appraisals are Appraisals are time consumingtime consuming and periods coincide with yearand periods coincide with year--end and budgets end and budgets

making it difficult for the work to be done efficiently.making it difficult for the work to be done efficiently.


Required improvement of traditionalRequired improvement of traditionalPerformance Appraisal systemsPerformance Appraisal systems

The ratings give a normal distribution curve with The ratings give a normal distribution curve with most staff most staff

members scoring 3members scoring 3. This brings inconsistencies in rewarding the . This brings inconsistencies in rewarding the

individuals, as it is an average score. Someone who scores 3.4 oindividuals, as it is an average score. Someone who scores 3.4 or r

thereabouts will be in the same category as a 2.5 yet there shouthereabouts will be in the same category as a 2.5 yet there should ld

be a marked distinction. In the end it makes it difficult to be a marked distinction. In the end it makes it difficult to

motivate staff and results in average performance.motivate staff and results in average performance.

The The weighting of objectives not standardisedweighting of objectives not standardised thereby resulting in thereby resulting in

discrepancies.discrepancies.

The The ratings are sometimes subjectiveratings are sometimes subjective leading to staff feeling leading to staff feeling

cheated e.g. how do you measure excellent?cheated e.g. how do you measure excellent?


A transformation to Balanced Scorecard can address A transformation to Balanced Scorecard can address some imbalances of the current systemsome imbalances of the current system

Financial Perspective

Obj

ectiv

es

Mea

sure

s

Targ

ets

Initia

tives

Customer Perspective

Obj

ectiv

es

Mea

sure

s

Targ

ets

Initia

tives

Internal Perspective

Obj

ectiv

es

Mea

sure

s

Targ

ets

Initia

tives

Learning and Growth Perspective

Obj

ectiv

es

Mea

sure

s

Targ

ets

Initia

tives

Balanced Scorecard

Balanced Scorecard

Balanced ScorecardB

alan

ced

Scor

ecar

d

Traditional Performance Management System

•At corporate level the focus is on the

financial aspects of the business

•At individual level the focus is on the

internal processes with a bit of learning

and growth

• Ratings should be measurable

• Employees had differentiation on basis

of grade than objectives

•Performance ratings should be

uniform.

•Weighting of objectives should be

standardized throughout the corporate.

•Ratings should be measurable.


Corporate Strategy/Corporate Strategic ObjectivesCorporate Strategy/Corporate Strategic Objectives

The STRATEGY MAP describes the corporate strategy in a single page, so it can be easily shared and communicated.

PriceQuality

Availability Functionality Service BrandSelection Partnership

Customer Value Proposition

Long-TermShareholder Value

Improve CostStructure

Improve Asset Utilization



Long-TermShareholder Value

Productivity Strategy

Growth Strategy



New RevenueOpportunities

IncreaseCustomer Value


InternalPerspective

•Environment•Safety & Health•Employment•Community

•Opportunity ID•R&D Portfolio•Design/Develop•Launch

•Selection•Acquisition•Retention•Growth

•Supply•Production•Distribution•Risk Management

Operations ManagementProcesses

Customer ManagementProcesses

InnovationProcesses

Regulatory &SocialProcesses

Learning &GrowthPerspective

Human Capital

Information Capital

Organization CapitalStrategic

Competencies

Customer Perspective Price Quality Availability Functionality Service BrandSelection Partnership

Customer Value Proposition

Product/Service Attributes Relationship Image

LeadershipStrategic

Alignment/MotivationStrategic

IntegrationStrategic

Awareness/Culture


• Ensures objectives map from the strategic level downwards;

• Translates strategy into performance, ensuring effective

cascading of performance throughout the organisation;

• Defines performance measures and targets;

• Allows the implementation of a performance management

process that enables line managers to manage performance

in line with organisational strategic objectives;

• Equip managers with necessary skills to manage

performance effectively;

• Establish a direct link between the achievement of strategic

objectives and reward;

• Be flexible to adapt strategy as circumstances change.

Enter The Balanced Scorecard Enter The Balanced Scorecard (BSC African case)(BSC African case)


The Balanced Scorecard CASCADING frameworkThe Balanced Scorecard CASCADING framework……

Outcomes

Drivers

“To Achieve The Financial Objectives, What Customer Needs Must Be Met?”

“To Satisfy Customers, And Shareholders, Which Internal Business Processes are Critical?”

“To Achieve These Goals, How Must The Organization \Be Equipped?”



Internal Process Perspective

Learning & Growth Perspective

“To Satisfy Shareholders, What Financial Objectives Must Be Accomplished?”

….carries the benefit of allowingcorporate measurement onhow value will be created acrossthe key business perspectives


FinancialIf we succeed financially, how will we

look to our owners?

CustomerTo achieve the vision,

how must we look to our customers?

ProcessTo satisfy our customers, in which

processes should we excel?

GrowthTo achieve our vision, how can we secure that our performance is continuously improved?

LearningTo achieve our vision, how can we ensure that

our employees are continuously developed and being positive?

Example of objectives set around five key perspectivesExample of objectives set around five key perspectives

• Efficient & Effective

• Knowledge• Pioneering• Proactive• Personal/ Caring

• Training & Development• Empowering employees• Motivation• Communication• Performance measurement

• Identify & understand need

• Determine solution• Provide solution• Support solution• Manage HR

• Manage performance• Sustainable profitability• Sustainable competitive advantage

• Create Value• Provide responsible

leadership• Competence


Critical Success FactorsCritical Success Factors

Develop External Customer Satisfaction SurveyDevelop External Customer Satisfaction Survey

Develop Service Level AgreementsDevelop Service Level Agreements

Develop Internal Customer Satisfaction SurveyDevelop Internal Customer Satisfaction Survey

Develop Complaints Logging SystemDevelop Complaints Logging System

Supply Chain ManagementSupply Chain Management

Develop Employee Satisfaction SurveyDevelop Employee Satisfaction Survey

ReRe--look Charter Of Authoritylook Charter Of Authority

Acquire Balanced Scorecard SoftwareAcquire Balanced Scorecard Software

Initiative No.Initiative No.

Customer Relationship ManagementCustomer Relationship Management

Business ContinuityBusiness Continuity

Initiative NameInitiative Name

1

2

3

4

5

6

7

8

9

10


For this reason: For this reason: BSC is a framework that helps organisations translate strategy into

operational objectives driving both behaviour and performance.

“No single measure can provide a clear performance target or focus

attention on the critical areas of the business. Managers want a

balanced presentation of both financial and operational

measures.”Kaplan and Norton


Core ValuesWhat we believe in

MissionWhy we exist

Using the Balanced Scorecard allows to link strategyUsing the Balanced Scorecard allows to link strategyand Performance Management better. and Performance Management better.

VisionWhat we want to be

Balanced Scorecard Implementation and focus

Strategic InitiativeWhat we need to do

Personal ObjectivesWhat I need to do

Strategic themesOur game plan

A framework to communicate the strategic objectives and

monitor how successfully they are being achieved, recognising 4 key

perspectives of business performance.

Functional ObjectivesWhat my division needs to do

OrganizationalStrategy

Perf

orm

ance

Man

agem

ent


Objectives have to be cascaded downObjectives have to be cascaded downthrough the organisationthrough the organisation

MissionWhy we exist

Core ValuesWhat we believe in

VisionWhat we want to be

Strategic themesOur game plan

Balanced Scorecard Im plementation and focus

Strategic InitiativeWhat we need to do

Personal ObjectivesWhat I need to do

Implementing all these different initiatives will put Econet on the road to achieving a balanced business and many beneficial strategic outcomes.

Satisfied Shareholders

Delighted Customer

s

Effective Processes

Motivated & Prepared

Workforce

Strategic Outcomes

Balan

ced

Busin

ess

Map

Financial X% Customer X%

Internal X% Learning & Growth X%

F T A Sc

TPS Balanced Scorecard

F T A Sc

F T A ScF T A Sc

F - Frequency of Measure T - Target Score B – Bi Annual A – Annual U - Unit of measure Gr -GreenA - Alarm Score Sc- Actual Score M – Month Q – Quarter D – Days Am -

10%10%25%100%

QQBQQQ

3075

%0%70

%0

2150%+5%50%2

50%75%75%1175%10%

QQQQQDQ

100%100%100%00100%0%

QBiQBiQQ

Q

280%10%100%3100%

100%

150%5%75%275%

60%

%%%%

U

%%%##%%

#%%%#%

%

U U

U

##%%%#

5%5%15%50%

MBMQ

.

The Corporate Balanced Scorecard

Sales hit ratio% on time in full deliverySign offsCustomer comeback# of fault reports after implementationResponse time to customer callsStaff turnover

ROIAsset growthProfitabilityTurnover growth

Bench strengthESSOverall performance improvementStaff feedback# of strategy review meetings held% performance appraisals on time & in fullCompany objectives met

Contacts/CustomerCustomer retentionCustomer satisfaction ratingPricing relative to competitionMarket ShareFindings/Audit

Strategic Objective:Names the objectiveMeasure:Names the measureMeasurement intent:Describes the measure and the reasoning behind itsselection as an indicator of progress against this strategic objective.

Frequency of Update:Identifies how often it is calculated

Units of Measure:Identifies the units in which the measure will be reported

Measurement Definition/Formula:Provides a detailed formula for the calculation of a numerical value for the measure

Notes/Assumptions:•Clarifies terms in the formula as necessary•Highlights key assumptions underlying the formula

Next Steps:

Measurement Information Is:------Currently Available------Available with minor changes

Data Elements and Sources:The data elements required to calculate thismeasure and the source systems, databases, documents, etc. of those data elements

Source for and Approach to Setting Targets:Identifies the report, document, system or individual from which the information will be obtained.

Target Setting Responsibilities:Person

Accountability for Meeting Target:Person

Tracking/Reporting Responsibility:Person

Measure Availability:DateTarget:Date

Target

Lists numerical targets by year for the variouscomponent of the formula where relevant.For 2003 list targets by quarter and year

2003 Actual

1Q2Q3Q4QFull Year

2004 Projected 2005 2006

Measure Templates will be documented.

CorporateCEO

General Manager

Manager

Supervisor

Technician

These Objectives must then be cascaded to all staff

Initiative #: Write the name of the Initiative

Activities

• What resources are required and what is the likely cost.Cost & Resources

• How long is it likely to takeDuration

(Low, Medium, High)• In what areas will the impact be

Ease of implementation

Impact

• Do not fill in will be filled in laterObjective Frequency Score

• (Easy, Average, Hard)

1. What activities will have to be performed in implementing the initiative

Inform this Resource

Consult this Resource

• Whose head will fall if things are not doneAccountable Resource

• Who must be consulted

• Who will do the workResponsible Resource

• Who must be informed

Agree on corporate strategy Develop

corporate scorecard

Define measures and set targets

Cascade scorecard down to

individualsDevelop

initiatives, and

charter

Roll out and transition with individual staff

members


Example of Cascading corporate objectives to DepartmentsExample of Cascading corporate objectives to Departments

Corporate Objective Corporate Measure IS Divisional Objectives

IS Divisional measures

T TA A

Efficiency and EffectivenessKnowledgeablePioneeringProactivePersonal/Caring

ROIEPS

Share priceFina

ncial

Cust

omer

Inte

rnal

Lear

ning

& G

row

th

Create valueProvide responsible leadershipCompetence

Identify & understand needDetermine solutionProvide solutionSupport solutionManage HRTraining & development

Empowering employeesMotivationCorporate communicationPerformance measurementSustainable competitive advantage

Customer satisfaction surveyMeeting SLAsChurn rte

Customer complaints

Grade of service

Revenue per employee

Adherence to training programOverall performance improvementInternal promotionsStaff retentionStaff satisfaction survey

% staff appraisals on time in fullInnovation rateBrand Equity

Reduce costs through IT resource optimisationCompetence

Efficiency and EffectivenessKnowledgeablePioneeringProactivePersonal/Caring

Internal Customer satisfaction surveyUptimeMeeting SLAsAudit report

Identify & understand needDetermine solutionProvide solutionSupport solutionManage HR

Customer response rate

Complaints as a % of users per solution% Resolved on time% requests met

Training & development

Empowering employeesMotivationCorporate communicationPerformance measurementSustainable competitive advantage

# of change to training planOverall performance improvementInternal promotionsStaff retentionStaff satisfaction survey

% staff appraisals on time in fullInnovation rate

80

95100

60

8095

10%

5%

US$

15%

105

US$

1

25%

60%90%80%

100%

2

2

-15%+50%50%80%75%

95%

1

90%

95%98%Gr

70%

90%90%Amb

80%

10%

8080

60%

15%

7070

1

25%

50%90%90%

100%

2

2

-15%+50%40%80%80%

95%

1

300M

5%75%

Savings

Budget deficit% Certified staff

150M

50%50%

60%US40c

$150

50%US30c

$100


Name: XXXXXXXXXXXX Dept: Network Planning & Dev Date:

Position: Chief Engineer Individual’s Signature: Assessor’s Signature:

Plng & DevObjectives

Plng & Dev Measures T A

T - Target A - Alarm

Subscriber BaseRollout TargetRoaming Revenue Inflows (US$)Cost Variance License ObligationTechnical ComplianceGrade of Service: - route

- radio networkDropped Calls

Fina

ncial

Cust

omer

Inte

rnal

Lear

ning

& G

row

th

Expand NetworkManage ITRIBudget & PlanMeet regulatory requirementsProvide Quality Service

Manage Internal Customers

Maintain stable & high network availability

Develop VAS

Identify & understand needDetermine solutionProvide solutionSupport solution

Internal Customer satisfaction ratingMeet SLA’sExternal Customer Satisfaction rating

Achievement of all grades of service

Network complaints/ subscriber

Network complaints resolved on time

Usage reports OTIF

60%80%60%

60%

X95%

100%

X80%

80%

ActualScore

AverageRating

Rating Rating AverageRating

3 - Green 2 - Amber 1- Red

OverallRating

OverallRating

Training & development

Empowering employees

Motivation

Departmental communication

Performance measurementKeep up-to-date with industry technological tends

No of changes to training plan local)No of changes to training plan(international)

Overall performance improvement

Internal PromotionsEmployee Satisfaction rating% minutes of planned meetings

% on time in full appraisalsBenchmark vs. supplier standards

163K60%200k??60%60%0.5%5%2%

161K50%100k??50%50%1%10%3%

80%95%80%

80%

1??

25%

60%80%100%

100%60%

2??

>50% <15%

50%75%66%

95%50%


Balancing Performance Management:Balancing Performance Management:The Balanced Scorecard evaluation process mapThe Balanced Scorecard evaluation process map

BS C

C reate S co recard

E v alu ateS co recard s

Ver ifyS co recard s

P u b lishE v alu atio n

O b jec tiv es

BS C

F in al BS C ratin g

F in al Ratin g

Remu n eratio n

S tak eh o ld ers

S taff & S u p erv iso rs

S k ills H R A u d it & Remu n eratio n

S trateg y

P o lic ies & P ro ced u res

Bu d g et

In co mp lete BS C

P er fo rman ce E v alu atio n

BS C

In itial Ratin g

Train in g G ap s

Rated BS C

D isc rep an c ies


The results of the balanced scorecard can The results of the balanced scorecard can be linked to remuneration as outlinedbe linked to remuneration as outlined

1

2

3

The score on the Balanced Scorecard will be aligned to percentage increments

x%

X +Y %

Indi

vidu

al Sc

ore 2.5

Scores between 2 and 3 will receive increments which are on a sliding scale. Increasing as they approach 3

Perc

enta

ges f

or in

crem

ents


BalancedScorecard

Makes strategy a continuous process

Measures the past present and the future through lag and lead

measures

Provides a balanced way for measuring performance that is financial, customer, internal,

learning and growth

Ensures the attainment of the following strategic outcomes, delighted customers, satisfied

shareholders, effective processes and motivated and

prepared workforce

Ensures strategy becomes everyone’s everyday job

Ensures effective communications are instilled

Clarifies vision and strategy and translates them into

operational terms

In conclusion, some benefits of the BSC process which must In conclusion, some benefits of the BSC process which must become an integral part of how we measure performancebecome an integral part of how we measure performance

Provides feedback around both the internal business processes and

external outcomes in order to continuously improve strategic

performance and results


“The value of an intangible asset such as human capital can be measured through its readiness to support the company strategy”

Robert Kaplan, David Norton

DefiningDefining an HR an HR ScorecardScorecardintegratedintegrated withwith the the corporatecorporate BSCBSC(CIS case)(CIS case)


Measuring human capital may be a challenge, but if you can’t measure you can not manage.

Balanced Scorecard is a proven tool that translates strategy as represented in the strategy map, into a comprehensive set of performance measures and targets.


The Human Capital strategy that supports the The Human Capital strategy that supports the performance of the corporate strategyperformance of the corporate strategy


InternalPerspective

Learning & GrowthPerspective


Shareholder Value

Human CapitalEffectiveness

Human ResourceEfficiency

LeadershipStrategic

Alignment/Motivation

StrategicCompetencies

StrategicIntegration

StrategicAwareness/

Culture

Customer Satisfaction Employee Satisfaction

Deliver WorldClass Services

Manage Customer Relationships

Manage OperatingEfficiency

Corporate/Business Units

Building a World Class HR Organization

Employees

HR Strategy Map


HR Balanced Scorecard (CIS example)HR Balanced Scorecard (CIS example)

F1. HR Effectiveness•Increase Shareholder Value

F2. HR Efficiency•Increase Human Organization Effectiveness

•Increase HR Organization Efficiency

Price Earnings Ratio

Revenue per EmployeeHR Cost/Employee

10% CAGR

4.5% growth<4%

Measures (sample)

C1. Build customer PartnershipC2. Customer satisfactionC3. Employee Satisfaction

Service Agreements in Place (%)Service Agreement FeedbackEmployee Satisfaction Survey

Cus

tom

er

I1. Manage Customer Relations

I2. Deliver World Class Services•Recruiting & Selection•Training & Development•Performance Management•Compensation & Rewards•Knowledge Management•Communication & Education•Leadership Development

I3. Manage Operating Efficiency•Same as I2

HR Strategic PlansTime with Customer

Benchmark RankingKey Initiative Tracking (from Linkage Scorecards)

Cost per TransactionCycle Time

L1. Develop Strategic Measurement SkillsL2. Amplify HR Best Practice SharingL3. Insure a Shared Mindset/AlignmentL4. Fill the HR Leadership PipelineL5. Provide Information for Decision Making

#of employees trained on measuresBest Practices Identified/TransferredPersonal Goals Linked to BSCKey Position Depth ChartIT MilestonesL

earn

ing

&

Gro

wth

Initiatives (sample)Targets

90%, 95%, 100%85% rating80% rating

90% Participation10 hrs/week/ee

Top 10 in market

5% reduction21 days50%, 80%, 100%90% survey rating80%, 90%, 95%80%, 90%, 95%80% on schedule

Service Agreement ProgramAccount Review ProgramEmployee Survey

HR Strategic Planning Process

Gold Partner ProgramHR4U

Cost TrainingScorecard ImplementationKnowledge Management

Fina

ncia

lIn

tern

alStrategic Objectives


Priorities for Human CapitalPriorities for Human Capital

1. Strategic Competencies

2. Leadership

3. Culture

Strategic Awareness

4. Goal Alignment

Incentives / Rewards

Performance Feedback

5. Knowledge Sharing

Teamwork

Positive Work Environment

0 20

40

60

80

100


IdentifyStrategic

JobFamilies

STRATEGIC GOALS and

BALANCED SCORECARD

HumanCapital

ReadinessReport

HumanCapital

DevelopmentProgram

DefineCompetency

Profile

AssessStrategicReadiness

The Human Capital Readiness Model

1

2

3

4

Human Resources ReadinessHuman Resources Readiness


1.1.Identify Strategic Job FamiliesIdentify Strategic Job FamiliesStrategic job families have the most impact on the strategy and are positions that differentiate the organization and create a sustainable competitive advantage.

10%

90%

(a) The Strategic

Job Family Model

(b) The Strategic

Competency Model

Val

ues

Kno

wle

dge

Skill

s

Strategic Job Families

Operational Roles

How can companies pinpoint the strategically significant jobs and ensure they make the most of their strategic job families? Without the guidance of a strategy map, most human resources development programs attempt to meet the needs of 100% of a company’s employees – thereby under investing in the jobs that really make a difference.


2. Define Competency Profiles2. Define Competency Profiles

Strategic Processes

CompetencyProfile

StrategicJob Families

Operations Management

MinimizeProblems

Provide RapidResponse

Customer Management

Cross-Sell theProduct Line

Shift toAppropriate

Channel

UnderstandCustomerSegments

Innovation

Develop NewProducts

ResponsibleCitizenDiverse

Workforce

QualityManager

Call CenterReps

CertifiedFinancialPlanner

Tele-marketer

ConsumerMarketing

Joint VentureManager

CommunityRecruiters

Measuring readiness requires the definition of a “competency profile” for each strategic job family and a test to determine who meets the requirements.

•Six Sigma

•Black Belt•Analytic

•Project Mgmt.

•Results Oriented

•Know theCustomer

•CRMMastery

•Results Oriented

•Know theCustomer

•Know theProduct

•ConsultingSkills

•RelationshipMgmt.

•CustomerPartnership

•Know theProduct

•Selling Skills

•NegotiationSkills

•ResultsOriented

•IndustryKnowledge

•MarketingProfessional

•Analytic

•CreativeThinker

•Risk taker•Innovative

•IndustryKnowledge

•ContractingSkills

•NegotiationSkills


•ResultsOriented

•CommunityKnowledge

•SellingSkills


•Team Player

Number Required

Human CapitalReadiness

100% 90% 40%

50%

20% 70% 80%

G G R R R Y G

(kno

wle

dge)

(ski

lls)

(val

ues)

10 20 5 20 10

WHAT

HOW

5 5


3. Assess Strategic Readiness3. Assess Strategic ReadinessStrategic Readiness – the degree to which an intangible asset meets the requirements of the strategy.

Strategy

Strategic Job &Competencies

Strategic Readiness

Strategic Job

Readiness

Ratio”=40%

•Solutions selling/relationship management•Product line knowledge•Licensed CertifiedFinancial Planner

Financial Planner

“Cross-sell theproduct line”

NotCertified

Certified

100

40


4. Define Human Capital Readiness4. Define Human Capital ReadinessCreating workforce readiness will require that the balanced scorecard is cascaded to all individuals.

10%

90%

The Strategic Job Family Model

Strategic Job

Families

Operational Roles

VP Region

Director

Manager

Associate


4. Define Human Capital Readiness 4. Define Human Capital Readiness (cont(cont’’d)d)A cascading approach needs to be established before aligning individuals to the BSC.

(The “what” (strategic priorities) gets cascaded down through the organization; the “how”(strategic results) gets rolled back up.

Corporate Scorecard

Business Unit Scorecards

Support Unit Scorecards

Division, Team and Individual Scorecards

Vision/Mission

Top-down articulation

Bottom-upexecution


4. Define Human Capital Readiness 4. Define Human Capital Readiness (cont(cont’’d)d)

Personal scorecard -templateName:___________________ Meeting Date:__________ Follow-up Date:_________

Strategy Map

Objectives

Personal Objectives

ProgressSuccess Measures

Wei

ght

Rat

ing

Scor

e

Financial

Customer

Internal Processes

Competencies

Importance of this objective

How well you performed to your targets.

Weighted score for your performance

Deliverables (projected) and dates

Deliverables (actual)

and dates


5.5. Creating a Reporting Mechanism/ObjectiveCreating a Reporting Mechanism/Objective

002222222222222244TotalTotal

XXXXXXInd. 9Ind. 9

XXXXInd. 8Ind. 8

XXXXInd. 7Ind. 7

XXXXInd. 6Ind. 6

XXXXInd. 5Ind. 5

XXXXInd. 4Ind. 4

XXInd. 3Ind. 3

XXXXInd. 2Ind. 2

XXXXInd. 1Ind. 1

Obj. 9Obj. 9Obj. 8Obj. 8Obj. 7Obj. 7Obj. 6Obj. 6Obj. 5Obj. 5Obj. 4Obj. 4Obj. 3Obj. 3Obj. 2Obj. 2Obj. 1Obj. 1


6. Creating a Reporting Mechanism/Competency6. Creating a Reporting Mechanism/Competency

The manager of the business unit must be able to view the competency gaps that exist among his staff.

In this example, “Know the Customer” is a competency critical to a Call Center Representative’s strategic success. The Alignment Matrix displays those individuals within the business unit that require further development of this competency and the action plan they will pursue to develop their individual skills.

Personal Scorecard Competency Report

Employee

Agility and Seizing Opportunities

Call Center Reps

Initiative Creativity

Flexibility

Know the Customer

CRM Mastery

Results Oriented

Know the Customer

Armen Petrosyan

Arthur Karapetyan

Razmik Nersissyan

Vardan Hakobyan

Attend training on customer

segmentation

Take a CRM training course

sponsored by XYZ

Financial IT department

Learn Balanced Scorecard

methodology and attend a

BSC reporting

meeting to learn results

Customer Segmentation

Seminar

Take a training class

Export to Excel

Click here to clear report cache


7. Develop a Strategic Human Capital 7. Develop a Strategic Human Capital Planning Program for the EnterprisePlanning Program for the Enterprise

Human CapitalCategory/Objective

Human Capital Readiness Report

1.Strategic CompetenciesUnderstand the competencies needed, the competencies availableand the plan to close the gap.

Human Capital Development ProgramMeasure of

Strategic Readiness Target

2.LeadershipBuild a cadre of leaders who canleverage human capital forcompetitive advantage.3. Strategic Awareness/CultureCreate an organization that internalizes the shared vision,strategy and cultural valuesrequired to execute.4. Strategic Alignment/MotivationCreate an organization wherepersonal goals and incentives arealigned with strategy and thatencourages personal contribution.

5. Strategic IntegrationCreate teamwork and culture toencourage the sharing of knowledge and experience neededby the strategy.

•Strategic Talent Gap•Key Employee Retention

•Leadership gap•Employee Survey ofLeadershipEffectiveness

•Cultural Alignment Index

•Goal Alignment (%)•Incentive Alignment (%)

•Sharing AcrossBoundaries

- Best Practice- Key People- Teams- Rewards

HR Programs/Functions

High PerformancePractices (examples)

Measures(examples)

•Hours of training(Strategic Focus)

•Fill Rate (%open“hot skills”)

•Jobs filled within•#qualified>1 job•#hrs. training

•Recruiting & Selection•Training & Development•Job/Work Design

•% Internal vsexternal hires

•%participation in leadership courses

•Leaders are visionary•Mission is clear•Accountable for strategy•Strategy linked to budget

•Leadership Development•Succession Planning•Governance Process•Strategy Management

•# of approvals needed

•Culture assessment

•Formal informationsharing program

•Mentoring Program

•Communications•Change Management•Leadership Development

•Personal goals linked to BSC (%)

•%receiving incentivecompensation

•Gain sharing payments

•Alignment of HR/Bus.•Balanced Scorecard•Owning stock•Eligible for incentive

•Performance Management•Compensation & Reward•Positive Work Environment

•% using knowledgesharing channels

•Key Staff Retention•Cross-Functional Teams•Shared Rewards

•Knowledge Management•Organization•Effectiveness•Staff Rotation

itu/bdt workshop on hr management tools and practicesitu/bdt/hcb sept 2008 hr management tools and...

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