You Just Don’t Get
Any Respect!
Client
“When we asked him how he was
involving his HR executive in grappling
with this problem, he dismissed the
question with a wave of his hand and
said, “My head of HR is very talented. But
this is business, not HR.”
Brian Becker, Mark Huselid, and Dave Ulrich, “The HR Scorecard-Linking
PEOPLE, STRATEGY, and PERFORMANCE, Harvard Business
School Press, 2001
Resulting From:
• Long-reaching global competition
• Growing market opportunities
outside of the U.S.
• Maturing U.S. markets
The New Paradigm
CEOs are beginning to recognize
the strategic importance of
Human Resource Management
How Does HR Become a Strategic Partner?
Three Important Factors
1. Understanding Four Key Elements
2. Creating the Competitive Edge
3. How HR Demonstrates Value
1.Understanding the Mind-Set of the CEO
2.Understanding the Strategic Thrust of the
Company
3.Realistic View of Company’s Ability to
Implement And Execute Strategy
4. CEOs Must be able to Measure the Value
Contribution of HR
1.Understanding the Mind-Set of the CEO
•
•
CEOs understand bottom-line financial
metrics--Don’t understanding that a
successful workforce is a leading indicator
of financial performance.
CEOs understand the cost of human
capital—Struggle to understand it as critical
key to competitive advantage.
1. Understanding the Mind-Set of the CEO
•
CEOs see HR as important, but for the
wrong reasons—Can’t see how HR
influences the success of the workforce.
Four Key Elements to Consider
2. Understanding the Strategic Thrust
1.Customer Centric
2.Low Cost Provider
3.Product Driven
Four Key Elements to Consider
3. Realistic View of Company’s Ability
to Implement And Execute Strategy
Internal Realities
External Realities
•Industry Changes
•Business Environment
•Customer Base
•Competitive Environment
Strategy
Implementation
& Execution
Workforce
Success
Iteration
Repeated iteration produces
tested, actionable model
•Strategic Thrust
•Organizational. Architecture
•Workforce competencies
•Right People
•Leadership capabilities
Four Key Elements to Consider
4. CEOs Must be able to Measure
Contribution by HR
Creating the Competitive Edge
That No Competitor can Duplicate
“While leaders have far more day-to-day influence on
a workforce than does HR, HR’s primary contribution
is helping line managers to see the “big picture” and
differentiating among present and potential
employees. Therefore, both leadership and HR must
be responsible for the delivery of the workforce
necessary to successfully execute the firm’s
strategy.”
Adopted from M. Huselid, B. Becker, and R. Beatty, THE WORKFORCE SCORECARD, HBSP
2005
Four Key Elements to Consider
4. CEOs Must be able to Measure Contribution by HR
Focus Must be on the
Value Creating Employees
Four Key Elements to Consider
Having the Right
People
In the Right Positions
•Sears
•Nordstrom’s
•Southwest Airlines
How HR Demonstrates
Value?
“Developing a world-class performance measurement system
hinges on a clear understanding of the firm’s competitive
strategy and operational goals—and a definitive statement of the
employee competencies and behaviors required to achieve the
firm’s objectives”
“Measurement systems—for the firm as a whole or for the HR
function—can create value only when they are carefully matched
with the firm’s unique competitive strategy and operational goals.”
Adapted from The HR Scorecard-Brian Becker, Mark Huselid, and Dave Ulrich 2001
Questions to Ask Yourself
Which strategic objectives are critical?
What are the performance drivers for each objective?
How would we measure progress toward these goals?
What are the barriers to the achievement of each objective?
How would employees need to behave to ensure that the
company achieves these goals?
Is the HR function providing the company with the employee
competencies and behaviors necessary to achieve these
objectives?
If not, what needs to change?
Competencies
Needed
Identify Skill
Gaps
Ongoing Assessment
Of Targeted Employees
Targeted Training
& Development
Partnership
Service
Revenue
From Customers
Increase Shareholder
Value
Mind-set & Culture?
1. Does the workforce understand and embrace
company strategy?
2. Do we have a supporting culture for execution?
Workforce Competencies?
1. Does the workforce have the necessary skills to execute?
Behavior?
1. Does the leadership and workforce consistently behave
in order to achieve company goals?
2. Have the value-creating positions been identified?
Success?
1. Has the workforce accomplished the critical objectives
of the business?
Performance Measurement Examples

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

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Depth of workforce understanding of business strategy
Depth of workforce understanding of linkage of incentive measures
to business measures
Extent to which values are clear and widely understood
Extent of understanding of the firm’s competitive strategy and
operational goals
Extent to which culture allows the firm to attract, develop, and retain
a diverse array of “value-creating” groups
Extent to which employees are seen primarily by senior management
as a cost to be minimized versus a source of value creation
1) It is absolutely imperative to understand the
Strategic Thrust of the Business and align HR
strategy to the company objectives
2) You must be brutally realistic about HR and
the company’s ability to implement strategy
3) It is a teamwork effort between leadership, the
workforce and HR—you can’t do it alone!
4) HR and the workforce’s contribution must be
measurable
Thank You and I Wish You Great
Success
Dave Light





Performance Measurement Examples
Gap between current and needed capabilities in
“value-creating positions
Internal talent bench strength; availability ratio
per vacancy
Percent of employees assessed to be “highly
capable”
Percent of employees understanding that
competency growth is essential for job security
Percent retention of core competency workforces
Performance Measurement Examples








Consistency and clarity of messages from top
management and for HR
Effectiveness in dealing with poor performers
Knowledge sharing of best practices
Percent of employees who met goals for customer
satisfaction
Percent of employees who report they believe messages
delivered through formal channels
Percent of positions filled on or before agreed-upon date
Percent of workforce that is promotable
Percentage retention of core competency workforces






Performance Measurement Examples
Gap between current and needed capabilities in “valuecreating positions
Internal talent bench strength; availability ratio per
vacancy
Percent of employees assessed to be “highly capable”
Percent of employees understanding that competency
growth is essential for job security
Percent of newly promoted employees performing
satisfactorily after six months
Percent retention of core competency workforces

B. Becker, M. Huselid, and D. Ulrich, THE HR SCORECARD-

D. Wade, R. Recardo, Corporate Performance Management


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Linking PEOPLE, STRATEGY, and PERFORMANCE (Harvard
Business School Press, 2001)
(Butterworth-Heinemann, 2001)
M. Huselid, B. Becker, and R. Beatty, THE WORKFORCE
SCORECARD (Harvard Business School Press, 2005)
P. Niven, Balance Scorecard Diagnostics (John Wiley & Sons,
2005)
R. Kaplan and D. Norton, Strategy MAPS-Converting Intangible
Assets into Tangible Outcomes (Harvard Business School Press,
2004)