Question

In Chapter 5 in the HR scorecard textbook, It explains the reasoning for implementing HR measurement systems in organizations. Think about your own organization, does it provide a measurement system that evaluates HR activities/functions. If so, discuss the system. If there is not a system in place recommend one and explain why you chose that particular system.

Answer 1

There are several approaches that measures and evaluates HR activities and functions. The most prominent of them are: audit approach, analytical approach, qualitative and quantitative approach, balanced scorecard perspective and benchmarking. For now the Company o work for are using Qualitative and Quantitative Indices approach.

Qualitative and Quantitative Indices approach.

This is to determine the effectiveness of HRM. Examples are: It can calculate cost of turnover, absenteeism cost, cost of work-life programs, cost per hire, lead time to fill vacancies, HR expense factor, training costs and other activities related to HR. It can also applied in analyzing behavior-costing related to relationship between employee attitudes, customer behavior and profits.

Explanation:

Other approaches are:

Audit Approach

Human resource management audit is a process of evaluating the effectiveness of the HR function.

Analytical Approach

The analytical approach relies on cost-benefit analysis, also called the utility analysis. Utility analysis seeks to express evaluations in economic terms, which are more useful for decision makers.

Balanced Score Card

Balanced score card helps evaluate HRM effectiveness.

Benchmarking

Benchmarking involves employees learning and adopting the so-called "best practices" by comparing their human resource management practices with those of other (more successful) organizations. Benchmarking essentially involves that employees study the practices followed in competing firms and evaluating own practices with those thus collected.