Balanced Scorecard

October 9, 2014 Leave a comment

In 1992, Robert S. Kaplan and David Norton introduced the performance measurement balanced scorecard, a concept for measuring a company’s activities in terms of its vision and strategies, to give managers a comprehensive view of the performance of a business. The key new element is focusing not only on financial outcomes but also on the human issues that drive those outcomes, so that organizations focus on the future and act in their long-term best interest. The strategic management system forces managers to focus on the important performance metrics that drive success. It balances a financial perspective with customer, process, and employee perspectives. Measures are often indicators of future performance. The balanced scorecard provides executives with a comprehensive framework that translates a company’s vision and strategy into a coherent set of performance measures.

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A Balanced Scorecard is made up of four components: mission, perspectives, objectives, and measures. Each of these components and how they build on each other is described below :

# Mission
The mission is the highest, guiding level of the scorecard. It answers the questions:
– What is our overall reason for being?
– What is our mission?
– Why do we exist as an organization?

# Perspectives
Perspectives represent the various areas that influence performance and overall achievement of the mission. There are typically four to five perspectives within a scorecard, however there can be more based on the needs of the organization. Perspectives answer the question “What are our key areas of focus in trying to achieve our mission?” According to (Kaplan and Norton, 1996), the balanced scorecard supplements traditional financial measures with criteria that measure performance from three additional perspectives – those of customers, internal business processes, and learning and growth:

a. Financial Perspective
Financial performance measures indicate whether a company’s strategy, implementation, and execution are contributing to bottom-line improvement. Financial objectives typically relate to profitability measured, for example: operating income, return on assets, cash flow, economic value added.

b. Customer Perspective
Managers identify the customer and market segments in which the business will compete and the measures of the business unit’s performance in these targeted segments. This perspective typically include several core or generic measures of the successful outcomes from well formulated and implemented strategy. The core outcome measures include: customer satisfaction, customer retention, customer acquisition, customer profitability, and market and account share in targeted segments.

c. Internal Business Perspective
The internal business process perspective, executive identify the critical internal processes in which the organization must excel. This process enable the business unit to deliver the value propositions that will attract and retain customers in targeted market segments and satisfy shareholder expectation of excellent financial returns.

d. Learning and Growth Perspective
This perspective identifies the infrastructure that the organization must build to create long term growth and improvement. The customer and internal business processes perspectives identify the factors most critical for current and future success.

The four perspectives of the scorecard permit a balance between short and long term objectives. The balanced scorecard fosters a balance among different strategic measures in an effort to achieve goal congruence, thus encouraging employees to act in the organization’s best interest. It is a tool that helps the company’s focus, improves communication, sets organizational objectives, and provides feedback on strategy.

# Objectives
Within each perspective, objectives identify what needs to be done in order to achieve the overall mission. They answer the questions:
– What must we do (from each perspective) to achieve the overall mission?
– What is most important (from each perspective) to achieving the overall mission?

# Measures
Measures provide a way to determine how an organization is doing in achieving the objectives within the perspectives and in turn the overall mission. They are the most “actionable” component in the scorecard. For each measure, a target is set so that progress toward the objective can be evaluated. Measures answer the question:
“How do we know how well we’re doing in achieving our objectives, and in turn our overall mission?”

How to develop Vision, Mission and Values for organization

July 7, 2014 Leave a comment

How to develop Vision, Mission and Values for organization

When approaching Vision, Mission and Values (VMV), as a process to be undertaken in your organisation, it’s important that everyone involved understands the concept and its component parts.
Descriptive definitions are provided below but here are the basic meanings as an introduction:
• Vision: where we’re going in the long-term
• Mission: our purpose and reason for existing
• Values: who we are, what we stand for
The diagram shows the relationship of these terms in the context of an organisation’s lifetime.
We can see that they represent statements to direct and guide the organisation over a sustained period of time – it’s because of this that they’re so important.
Values
Read more…

Role of HRM

June 23, 2014 Leave a comment

ROLE OF HRM

1. Advisory Role: HRM advises management on the solutions to any problems affecting people, personnel policies and procedures.
(a) Personnel Policies: Organization Structure, Social Responsibility, Employment Terms & Conditions, Compensation, Career & Promotion, Training & Development and Industrial Relations.
(b) Personnel Procedures: Relating to manpower planning procedures, recruitment and selection procedures, and employment procedures, training procedures, management development procedures, performance appraisal procedures, compensation procedures, industrial relations procedures and health and safety procedures.

2. Functional Role: The personnel function formulates personnel policies in accordance with the company’s doctrine and management guidelines. It provides guidance to managers to help them ensure that agreed policies are implemented.

3. Service Role: Personnel function provides personnel services. These services constitute the main activities carried out by personnel department, like payroll, disciplinary actions, etc, and involve the implementation of the policies and procedures described above.

 

ROLE OF HR MANAGERS

1. Humanitarian Role: Reminding moral and ethical obligations to employees.
2. Counsellor: Consultations to employees about marital, health, mental, physical and career problems.
3. Mediator: Playing the role of a peacemaker during disputes, conflicts between individuals and groups or management.
4. Spokesman: To represent the company in Media and other forums because he has better overall picture of his company’s operations.
5. Problem Solver: Solving problems of overall human resource management and long-term organizational planning.
6. Change Agent: Introducing and implementing institutional changes and installing organizational development programs
7. Management of Manpower Resources: Broadly concerned with leadership both in the group and individual relationships and labour-management relations.

 

MANAGERIAL FUNCTIONS OF HRM

1. Planning: Research and plan about wage trends, labour market conditions, union demands and other personnel benefits. Forecasting manpower needs etc.
2. Organizing: Organizing manpower for the achievement of organizational goals and objectives.
3. Staffing: Recruitment & Selection
4. Directing: Issuance of orders and instructions, providing guidance and motivation to managers and employees.
5. Controlling: Regulating personnel activities and policies according to plans. Observations and comparisons of deviations

 

OPERATIONAL FUNCTIONS OF HRM

1. Procurement: Planning, Recruitment and Selection, Induction and Placement
2. Development: Training, Development, Career planning and counselling.
3. Compensation: Wage and Salary determination and administration
4. Integration: Integration of human resources with organization.
5. Maintenance: Sustaining and improving working conditions, retentions, employee communication
6. Separations: Managing separations caused by resignations, terminations, lay offs, death, medical sickness etc.

 

Emotional Intelligence – High and Low

June 16, 2014 Leave a comment

Emotional Intelligence greatly influences social effectiveness of the manager. People with higher intelligence reveal more strengths and positively contribute to the organizational climate and work efficiency:

  • Low Emotional Intelligence
    • Aggressive, demanding, egotistical bossy, confrontational
    • Easily distracted, glib, selfish, poor listener, impulsive
    • Resistant to change, passive, unresponsive, slow, stubborn
    • Critical, picky, fussy, hard to please, perfectionistic
  • High Emotional Intelligence
    • Assertive, ambitious, driving, strong-willed, decisive
    • Warm, enthusiastic, sociable, charming, persuasive
    • Patient, stable, predictable, consistent, good listener
    • Detailed, careful, meticulous, systematic, neatImage

Emotional Intelligence Test

June 16, 2014 Leave a comment

 

The Emotional Quotient (EQ) Test is a scientifically validated psychometric test which is designed to measure and analyze the important aspects of personality and behavior that are instrumental in determining the emotional quotient of an individual. Upon completing the test you are provided with a comprehensive report on each trait, an overall summary report and a hiring recommendation report.

The personality traits that are measured and analyzed through the Emotional Quotient Test are:

  • Intrapersonal EQ
  • Interpersonal EQ
  • Stress Management
  • Adaptability
  • General Mood

The Emotional Quotient Test is commonly used by companies and hiring managers for analyzing important aspects of emotional behavior. The Emotional Quotient Test is widely acknowledged to be an effective tool for building motivated and compatible teams, while helping to reduce employee attrition

Developing HR Strategies

May 31, 2014 Leave a comment

Developing HR Strategies

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STEPS TO BUILD UP HR STRATEGY

Step 1: Get the ‘big picture’

Understand your business strategy.
• Highlight the key driving forces of your business. What are they? e.g. technology, distribution, competition, the markets.
• What are the implications of the driving forces for the people side of your business?
• What is the fundamental people contribution to bottom line business performance?

Step 2: Develop a Mission Statement or Statement of Intent

That relates to the people side of the business.
Do not be put off by negative reactions to the words or references to idealistic statements – it is the actual process of thinking through the issues in a formal and explicit manner that is important.
• What do your people contribute?

Step 3: Conduct a SWOT analysis of the organization

Focus on the internal strengths and weaknesses of the people side of the business.
• Consider the current skill and capability issues.
Vigorously research the external business and market environment. High light the opportunities and threats relating to the people side of the business.
• What impact will/ might they have on business performance?
• Consider skill shortages?
• The impact of new technology on staffing levels?
From this analysis you then need to review the capability of your personnel department. Complete a SWOT analysis of the department – consider in detail the department’s current areas of operation, the service levels and competences of your personnel staff.

Step 4: Conduct a detailed human resources analysis

Concentrate on the organization’s COPS (culture, organization, people, HR systems)
• Consider: Where you are now? Where do you want to be?
• What gaps exists between the reality of where you are now and where you want to be?
Exhaust your analysis of the four dimensions.

Step 5: Determine critical people issues

Go back to the business strategy and examine it against your SWOT and COPS Analysis
• Identify the critical people issues namely those people issues that you must address. Those which have a key impact on the delivery of your business strategy.
• Prioritize the critical people issues. What will happen if you fail to address them?
Remember you are trying to identify where you should be focusing your efforts and resources.

Step 6: Develop consequences and solutions

For each critical issue highlight the options for managerial action generate, elaborate and create – don’t go for the obvious. This is an important step as frequently people jump for the known rather than challenge existing assumptions about the way things have been done in the past. Think about the consequences of taking various courses of action.
Consider the mix of HR systems needed to address the issues. Do you need to improve communications, training or pay?
What are the implications for the business and the personnel function?
Once you have worked through the process it should then be possible to translate the action plan into broad objectives. These will need to be broken down into the specialist HR Systems areas of:
• employee training and development
• management development
• organization development
• performance appraisal
• employee reward
• employee selection and recruitment
• manpower planning
• communication
Develop your action plan around the critical issues. Set targets and dates for the accomplishment of the key objectives.

Step 7: Implementation and evaluation of the action plans

The ultimate purpose of developing a human resource strategy is to ensure that the objectives set are mutually supportive so that the reward and payment systems are integrated with employee training and career development plans.

 

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Interview Guidelines, tips — Human Resources

May 26, 2014 Leave a comment

Interview Types

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Screening Interview

This type of interview is generally conducted by larger companies when there is a large applicant pool and is typically the first phase of selection. Screening interviews are used to ensure that the candidates meet minimum requirements and are often conducted by a computer or by an interviewer from the human resources department who is skilled at determining whether there is anything that might disqualify you from the position.

Tips:

• Highlight your qualifications and accomplishments using non-technical language – the HR professional is not necessarily an expert in your field.
• Answer questions clearly and succinctly – personality is not as important at this stage of the process.
• If asked about salary expectations, use a range – make sure you’ve done your homework in this area.
• If conducted by phone, have your resume beside you to refer to for dates and names.

Telephone Interview

Telephone interviews are often used to screen candidates in order to narrow the pool of applicants who will be invited for in-person interviews- and is a good way to minimize travel expenses! They can be challenging because you aren’t able to rely on nonverbal communication or body language. You should prepare for this type of interview just as you would for a regular interview so, if you are not given any warning and are not ready for an interview when called, politely request that the interviewer call back at another mutually convenient time. This will allow you to refresh your memory on the organization and be better prepared.

Tips:

• Have your resume, organization information, points that you want to highlight, and list of questions you may want to ask in front of you – and have a short list of your accomplishments prepared to discuss.
• Although you’re not required to dress up, you may find that it’s easier to get into the ‘interview mindset’ and feel more confident when dressed professionally.
• Have a pen and paper handy to keep notes or write down any questions that come up; keep a glass of water beside you.
• Close the door or ensure you are in a quiet setting to eliminate any potential distractions.
• Speak slowly, enunciate clearly, and vary your voice tone, tempo, and pitch to keep the interviewers attention.
• Provide short answers that make interchange easier on the phone; do not interrupt the interviewer.
• Restate the question if you have not fully heard or understood it.
• Smile – even on the phone it will project a positive image.

Video Conferencing

Video conferencing is typically used to conduct interviews using video technology from a distance. The same interview strategies you would use if you were meeting in person apply – clothing, body language, and dialogue are important.

Tips:

• Depending on the sophistication of the technology, you may experience short transmission delays so be sure to take that into account when you are interacting with the interviewer.
• Make eye contact with the camera, which, to the employer, appears as direct “eye contact.”
• Check the monitor periodically to observe the interviewer’s body language.

One-on-One Interview

The most common interview format is the one-on-one (or face-to-face). This interview is traditionally conducted by a direct supervisor and if often the last step in a series of interviews. The interviewer may or may not be experienced in conducting interviews and, depending on personality and experience, the interview may be directive following a clear agenda, or non-directive relying on you to lead the discussion as you answer open-ended questions.

Tips:

• You will likely be asked a variety of interview questions, so be familiar with all of the different types of questions so that you can adjust your answers appropriately.
• It is important to be thoroughly prepared – know the job and know yourself.

Panel Interview

A panel interview is conducted by two or more interviewers and is designed to reduce individual interviewer bias. It is very common for entrance into graduate and professional schools. One member of the panel may ask all of the questions or individual panel member may take turns.

Tips:

• Make eye contact with the person asking the questions, but also to give every member on the panel your attention, regardless of if they ask any questions at all – treat them all with equal importance.
• Be prepared to extend more energy in this setting, as you need to be alert and responding to more people

Group Interview

A group interview occurs when several candidates for a position are interviewed simultaneously. Group interviews offer employers a sense of your leadership potential and style, and provide a glimpse of what you may actually be like as an employee and how you would fit into the team. Candidates may also be asked to solve a problem together which allows interviewers to assess candidate’s skills in action (e.g. teamwork).

Tips:

• Be aware of the dynamics established by the interviewer, try to discover the “rules of the game”.
• Regardless of how you may feel about any member of the group, treat everyone with respect, and avoid power struggles which make you appear uncooperative.
• Give everyone a chance to speak and not monopolize the conversation.
• Be aware that all interactions are being observed; don’t let down your guard or lose your perspective.

General Group Interview/Information Session

This approach is intended to save time and ensure applicants understand the basics of the job and organization by providing large amounts of information. This process is usually followed by an individual interview.

Tip:

• To stand out in a group setting, a well-timed and intelligent question may help the employer remember you positively.

Sequential/Serial Interview

A sequential interview is conducted by two or more interviewers, separately or in sequence. The candidate either moves from one location to another or stays in one room and while different interviewers join them. Sequential interviews involve a number of ‘first impression’ opportunities so be aware of how you present yourself each time. At the end of the process, the interviewers meet to evaluate each applicant and make their decision.

Tip:

• If you have difficulties remembering what you have already said to one person – don’t be afraid to ask!

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