Aligning Organizacional Structure With Business Goals
The key focus in Human Resource Management (HRM) is the identification of appropriate HR’s strategy, structure and systems within the context of value creation, that it require for the business / organization.
Both HRM and Organization Strategy (Organizational Design as well) must be aligned. Indeed, the main issue is to find out how HRM strategy adds value to the organization.
Lets see the following chat:
The HRM adds value to the business, doesn’t it?
Depends. If HRM has a strategy aligned to the business, then yes!
How is this? The HRM and their inherent area not always have been empowered enough within the Organization, in other cases, HR people don’t full understand or fullfil how to add value to the business strategy.
What methodologies HRM should have?
HRM is a field directed at interventions in the processes of human systems (formal and informal groups, organizations, communities, and societies) in order to increase their effectiveness and health using a variety of disciplines, principally applied behavioral sciences. HR requires practitioners to be conscious about the values guiding their practice and focuses on achieving its results through people.”
But that is not enough to get a HRM aligned with the business strategy
It is necesary the mastering of the following fields:
1. Stategic Planning
2. Customer satisfaction
3. Financial performance
4. Competitive advantage
5. Process Management
Regional Airline Balanced Scorecard
Mission: Dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit. Vision: Continue building on our unique position — the only short haul, low-fare, highfrequency, point-to-point carrier in America. Read More
People are reluctant to have a performance review driven by esoteric methods or arbitrary data. On the contrary, if the methodology is accepted objective and reliable by workers or colleagues, performance evaluation it is taken as a way to give them recognition for their achievements, which impacts positively on the commitment.
A very good tool for measuring individual performance is the use of Dashboards or Scorecard(1) made with quantitative performance indicators. (1) The term Scorecard belongs to Balanced Scorecard authors Norton & Kaplan.
I use Norton and Kaplan methodology to build HR dashboards with objective, relevant and measurable indicators.
Example of an Individual HR Scorecard
Ideally designed dashboards for managers with relevant indicators for business. I mean they are related to the success or business result. These indicators must be quantifiable and objective, i.e., that its measurement NOT depend on who is measuring, so that people are safe that its assessment is not subject to arbitrary or prejudiced by his (her) supervisor. In addition, the scorecard performance, specific indicators should consider both specif and group measures. The latter, I recommend it because what is really important in a company are its key processes, i.e. sales, customer service, quality control, to name the most obvious. Therefore it is important that those involved in these processes share performance indicators, although in different magnitudes. In these processes concur a collective effort of the organization, for example the commercial department, collections, treasury, accounting, sales management, marketing, quality control, etc.
Keep it simple and concentrate on what matters
With this design, a medium sized company , 100 to 150 people , no need to create and manage a hundred indicators for performance management system . This approach has the added advantage of providing a system in which the company is measured with common goals which encourages coordination and communication between areas of the company. And involve people in organization strategy. If you do not, your company is in serious problem.