HR Divisional Business Drivers and KPI Development Workshop

HR Divisional Business Drivers and KPI Development Workshop
HR Divisional Business Drivers & KPI Development Workshop
Program Agenda
Day One

Introduction of Balanced Scorecard Cascading of HR Performance Scorecard Strategy Map Human Resources Identifying Department Key Performance Indicators
Day Two

Writing SMART Key Performance Indicators HR Performance Appraisal Form Performance Appraisal Process (September till December 2009)
What is a Balanced Scorecard?

At the highest conceptual level, the Balanced Scorecard is a framework that helps organizations translate strategy into operational objectives that drive both behavior and performance.
A Balanced Scorecard is
a management and measurement system whose purpose is to translate strategy into a limited set of measures that uniquely communicate your vision to the organization Kaplan and Norton ...its key management perspectives are ...
What is the Balanced Scorecard? It addresses four basic questions: Financial Perspective: How are we faring with shareholder returns? Customers Perspective: How do customers see us and value our services? Internal Process Perspective: What must we excel at to meet customer needs? Learning & Growth Perspective: How can we develop our people and their capabilities?
Alignment & Cascading Business Agenda
The Balanced Scorecard concept..

Finance Objectives Measures Targets Initiatives
Customer Objectives Measures Targets Initiatives Objectives
Internal Business Process Measures Targets Initiatives
VISION AND STRATEGY
Learning and Growth Objectives Measures Targets Initiatives
Translate Strategy: The BSC Translates Strategy into the Four Perspective Framework
The Strategy
The BSC represents the cause and effect relationships in your strategy.
Financial Perspective
If we succeed, how will we look to our shareholders?
Profitability Growth Shareholder Value
Outcomes
Customer Perspective
To achieve our vision, how must we look to our customers?
Price Service Quality
Internal Perspective
To satisfy our customers, what management processes must we excel at?
Infrastructure Productivity Cost Technology
Drivers
The BSC is comprised of themes, objectives, measures, targets, and initiatives.
Learning & Growth Perspective

To achieve our vision, how must our organization learn and improve?
Capability enhancement Continuous Improvement Employee Engagement
The Importance of Alignment

Complete Framework for YOUR COMPANY KRAs
STAR
KPIs
Measures
HRA Division
Individual
The Strategy Map Aligns Processes and Intangible Assets to Customer and Financial Outcomes
Sustained Shareholder Value
Financial Perspective
Productivity Strategy
Revenue Growth Strategy
Improve Cost Structure
Increase Asset Utilization
Enhance Customer Value
Expand Revenue Opportunities
Customer Value Proposition
Price
Quality
Availability
Selection
Functionality
Service
Partnership
Relationship
Brand
Image
Product/Service Attributes
Operations Management Processes Processes that produce and deliver products and services
Customer Management Processes Processes that enhance customer value
Innovation Processes Processes that create new products and services
Regulatory & Social Processes Processes that improve communities and the environment
CREATING ALIGNMENT
Strategic Job Families
Human Capital
Skills Training Knowledge
CREATING READINESS
Strategic IT portfolio Organization Change Agenda
Learning & Growth
Information Capital
Systems Databases Networks
Organization Capital
Culture Leadership Alignment Teamwork

The Premise Behind the Balanced Scorecard Is that Measurement Motivates Behavior
The Premise
Measurement Communicates Values, Priorities And Direction
The Conclusion
Measurement Must Be Linked To Strategy
Strategy
Balanced Scorecard
Measurement To Communicate, Not To Control
Balanced Scorecard Example

Strategy Map: Diagram of the cause-and-effect relationships between strategic objectives
Strategic Theme: Operating Efficiency

Financial Profitability Fewer planes Customer Flight Is on time Lowest prices More customers
Statement of what strategy must achieve and whats critical to its success
How success in achieving the strategy will be measured and tracked
The level of performance or rate of improvement needed
Key action programs required to achieve objectives
Objectives
Internal Fast ground turnaround
Measurement
Target
Initiative
Fast ground
turnaround
On Ground Time On-Time

Departure
30 Minutes 90%
Cycle time
optimization
Learning Ground crew alignment
Balanced Scorecard Example

Strategic Theme: Operating Efficiency
Financial Profitability More Customers
Objectives
Measurement
Target
Initiative
Fewer Planes
Market Value 30% CAGR Profitability 20% CAGR More Customers Seat Revenue Plane Lease Cost 5% CAGR Fewer planes Flight is on -time FAA On Time Arrival Rating Lowest prices Customer
Ranking (Market Survey)
Customer Flight Is on Time Lowest Prices
#1 #1
Quality
management Customer loyalty program
Internal Fast Ground Turnaround
Fast ground
turnaround
On Ground Time On-Time

Departure
30 Minutes 90%
Cycle time
optimization program
Learning Ground Crew Alignment
Ground crew
alignment
% Ground crew
trained
yr. 1
% Ground crew
stockholders
70% yr. 3 90% yr. 5 100%
ESOP Ground crew

training
1. Executive Involvement
Strategic decision makers must validate and own the strategy and related measures
2. Cause-and-Effect Relationships
A good Balanced Scorecard will tell the story of your strategy in actionable terms.
Every objective selected should be part of a chain of cause and effect linkages that represent the strategy
3. Balance between outcome and leading measures There should be a balance of outcome
measures and leading measures to facilitate anticipatory management
4. Financial Linkage
Every objective can ultimately be related to financial results
5. Linkage of Initiatives and Measures: Each

initiative should be based on a gap between baseline and target.
Group Activity
Work in Groups of 4
Identify what are the HR objectives complements: 1) Finance
2) Customer
3) Internal Processes 4) Learning & Growth

The process of cascading creates synergy. It must be based on a clear understanding of the corporate role.
Scorecard Cascade
STAR Corporate Role
Department Derived Value (Synergy)
Perspective F1
Strategic Objectives Monitoring HR operating expenses
Strategic Measures Variance of actual against departmental budget Employment cost per employee Recruitment cost per employee Employee cost over/budget/revenue/profit/operating cost Admin cost per employee Admin cost over budget/revenue/profit/operating cost Rating vs. internal satisfaction (survey)
Targets
HR PERFORMANCE SCORECARD
Finance Perspective
F2
Monitoring Employee Costing
F3 Customer Perspective C1 I1
Monitoring the administrative costing activities Improve on internal customer satisfaction Review and improve the effectiveness of HR internal control systems
Percentage of reviews within specified timeframe Fulfillment of specified number of training hours per employee Improvement in performance evidence in annual appraisal Variance of actual against organizational and departmental training budget
Learning and Growth
L1
Develop skilled workforce
HR Divisional Business Drivers & KPI Development Workshop The Balanced Scorecard for Human Resource Division
Perspective Strategic Objectives
Strategic Measures
Variance of actual against departmental budget
Targets
F1
Monitoring HR operating expenses
Finance Perspective
F2
Employment cost per employee Recruitment cost per employee Employee cost over/budget/revenue/profit/operating cost Admin cost per employee Admin cost over budget/revenue/profit/operating cost
F3
Monitoring the administrative costing activities
C1
Improve on internal customer satisfaction
Rating vs. internal satisfaction (survey)
I1
Review and improve the effectiveness of HR internal control systems
Percentage of reviews within specified timeframe
Learning and Growth L1 Develop skilled workforce
Fulfillment of specified number of training hours per employee Improvement in performance evidence in annual appraisal Variance of actual against organizational and departmental training budget
Use the HR Performance Scorecard to Select and Manage Individual Initiatives

Perspective Strategic Objectives Strategic Measures Targets F1 Monitoring HR operating expenses Variance of actual against departmental budget Employment cost per employee Recruitment cost per employee Employee cost over/budget/revenue/profit/operating cost Admin cost per employee Admin cost over budget/revenue/profit/operating cost Rating vs. internal satisfaction (survey)
HR Performance Scorecard
Finance Perspective
F2
F3 Customer Perspective C1 I1
Monitoring the administrative costing activities Improve on internal customer satisfaction Review and improve the effectiveness of HR internal control systems
Percentage of reviews within specified timeframe Fulfillment of specified number of training hours per employee Improvement in performance evidence in annual appraisal Variance of actual against organizational and departmental training budget
Learning and Growth
L1
Develop skilled workforce
Select and Determine relevant HRA KPIs

Head of Human Resources & Administrations
Organizational Development & Training
Compensation & Benefits
Recruitment
Industrial & Employee Relations
Administrations
The Balanced Scorecard aligns priorities throughout the enterprise.
Human Resources & Administration Department Structure
Recruitment
Administrations
Human Resources & Administration Department KPIs

Departmental Cost Efficiency Employee Cost Admin Cost Process Improvement (HR policies, procedures, processes) Customer Satisfaction Skilled Workforce

Training cost Skill Workforce Training Process improvement

HR cost Process improvement
Recruitment

Employee relation Process improvement
Administrations
Recruitment cost Process improvement
Admin cost Process improvement
HR Divisional Business Drivers & KPI Development Workshop Balanced Scorecard Cascading Process
By Whom Cascading Process OUTCOME
Vision
Corporate Role
Mission Values Business Strategy Performance Outcome
HR PERFORMANCE SCORECARD
Organizational Development & Training Compensation & Benefits

Finance Perspective
Perspective
Strategic Objectives
Strategic Measures
Targets
F1
Monitoring HR operating expenses
Variance of actual against departmental budget
F2
Employment cost per employee Recruitment cost per employee Employee cost over/budget/revenue/profit/oper ating cost
F3
Monitoring the administrative costing activities
Admin cost per employee Admin cost over budget/revenue/profit/operating cost
C1
Improve on internal customer satisfaction
Rating vs. internal satisfaction (survey)
Recruitment
I1
Review and improve the effectiveness of HR internal control systems
Percentage of reviews within specified timeframe
Administrations
Learning and Growth L1 Develop skilled workforce
Fulfillment of specified number of training hours per employee Improvement in performance evidence in annual appraisal Variance of actual against organizational and departmental training budget
Individual Prioritized List of KPIs and Initiatives

The Value Drivers provide the glue between the four perspectives of the Balanced Scored by outlining the cause and effect: relationships
Value drives provide the cause and effect: between the four perspectives
Example: Identify the intermediate drivers that link training and development programs and behaviours to business priorities and financial performance
Training Total Return
Leads to, .
LEADING INDICATORS LAGGING INDICATORS
Training
Responsiveness to Clients Employee Morale Customer Satisfaction Increased Sales Total Return
Cause Correlation
Effect
Some Goals of the Balanced Scorecard

The Balanced Scorecard is a framework that helps organizations translate strategy into operational objectives that drive both behavior and performance
Create a systems approach to form an integrated Strategic Management Process

Provide a clear line of sight to the vision and strategy of the company Provide a tool for cascading the communication processes:
strategy, and
processes and systems required for implementing the strategy Draw a cause and effect roadmap to stakeholder value shareholder, customer, and employee.
What gets measured gets done. If you do not measure results, you cannot tell success from failure. If you cannot see success, you cannot reward it. If you cannot reward success, you are probably rewarding failure. If you cannot see success, you cannot learn from it.
If you cannot recognize failure, you cannot correct it.

If you cannot demonstrate results, you cannot win stakeholders support is used here.
Personal Action Work
Program Agenda
Day One

Introduction of Balanced Scorecard Cascading of HR Performance Scorecard Strategy Map Human Resources Identifying Department Key Performance Indicators
Day Two

Writing SMART Key Performance Indicators HR Performance Appraisal Form Performance Appraisal Process (September till December 2009)
What is Performance Management?

It is a communication process that enables the employee and his/her manager to foster a partnership to improve performance throughout the year
Purpose of Performance Managemet
The Performance Management Process is a continous cycle that supports a cultural of excellence in service delivery and productivity. It enables us to link business objectives to individual objectives and focus on priorities. It is a major part of the on-going process of managing people and not merely the completion of forms. Formal process to measure performance, give feedback and document performance. Identify training and development needs. Identify special talent and provide support for advancement.
Purpose - continued
Identify weaknesses in work processes
Recognise strengths and motivates employees

Make
assessments about salary increases based on performance Direct work and behaviour of a unit or team towards achieving business targets Clarify expectations performance and others between the manager and the individual
Performance Definition
WHAT an Individual achieves
(Results/Individual Key Performance Indicators)
+ HOW the Individual achieves it

(Competencies)
= PERFORMANCE
Writing SMART Key Performance Indicators
Key Performance Indicators Defined
Key Only a subset of all possible viewpoints,

those which best reflect the state of an asset, organization or financial entity ones job, or adhering to a agreed standards
Performance Metrics related to performing Indicator Not a closed-loop function, KPIs

are to be used by people to help them take correct action
Benefits of Performance Management

Opportunity to receive feedback on performance Enhanced working relationships between Manager and Employees Helps Employee focus on meeting needs of business Helps Employee grow and develop skills => training needs identified Employee can highlight career ambitions/aspirations Explore and resolve problems/differences Reduce Employee turnover
Setting Targets - Performance Objectives

What makes an Objective Effective? SPECIFIC (both parties know exactly what needs to be achieved) MEASURABLE (it will be possible to say if the number has reached 100) ACHIEVABLE (presumably this is within the realms of possibility from the current base) RESULTS-ORIENTED (targeted towards achieving the desired outcome) TIME-BOUND (the goal has to be achieved by end of Quarter 2)
Criteria for WellWritten Objectives
Specific A specific objectives is one that is understandable, clear, concise and explicit. For example: Recruitment of management trainees.
To be clearer, the objective can be rewritten as: ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________
Specific A specific objectives is one that is understandable, clear, concise and explicit. For example: Recruitment of management trainees. To be clearer, the objective can be rewritten as: Develop an action plan for the recruitment of management trainees by shortlisting and assessing the candidates within 75 days time (from date of advertisment in the newspaper.
Measurable A measureable objective defines how it will be measured. This can be in terms of quantity, cost, timeliness, and/or quality. Example: Deploy HRIS as the main database of employee records. Well written objective ______________________________________________ ______________________________________________ ______________________________________________ ______________________________________________
Measurable A measureable objective defines how it will be measured. This can be in terms of quantity, cost, timeliness, and/or quality. Example: Deploy HRIS as the main database of employee records. Well written objective Deploy HRIS as the main database of employees data (personnel, history, career training and etc) been updated to current month by October 2009 according to blue print of the master document plan. (evidence: all filing of paperwork cleared / no back log & ease to access personnel data of any employee) without any error.
Achievable An achievable objective defines how realistic it will be achieved and not beyond your reach. Achieve a higher rating in Customer Satisfaction Survey Example: Well written objective: ________________________________________________ ________________________________________________ ________________________________________________ ________________________________________________
Achievable An achievable objective defines how realistic it will be achieved and not beyond your reach. Achieve a higher rating in Customer Satisfaction Survey Example: Well written objective: To achieve rating of 4 or higher on a 5 point in Customer Satisfaction Survey conducted by an outside agency by 31st December 2009.
Result Oriented
The objectives set must be able to reflect the results of the objectives.
A less SMART objective might be: Continuous performance awareness briefing for all employees. Example: Well written objective _________________________________________________ _________________________________________________ _________________________________________________ _________________________________________________
Result Oriented
The objectives set must be able to reflect the results of the objectives.
A less SMART objective might be: Continuous performance awareness briefing for all employees. Example: Well written objective Conduct at least 3 briefing sessions by November 2009 with a minimum of 80% results reflected in the assessment form.

Time Bound The results of your efforts need to be evident to the people who provide you with feedback. Need to be done within a certain time frame. Example: Support team members development plans
Alternative way to state the objective: _________________________________________________ _________________________________________________ _________________________________________________ _________________________________________________ _________________________________________________

Time Bound The results of your efforts need to be evident to the people who provide you with feedback. Need to be done within a certain time frame. Example: Support team members development plans Alternative way to state the objective: Identify and complete a specific number of staff development actions to support each team members development yearly plan by end of December 2009 with a minimum of 48 hours of trainings.
Performance Ratings
Rating 1 : Performance significantly below expectation => Not achieved Objectives are not met and the person is not responding to Training, Development or Coaching. A decision on future employment is required.
Rating 2 : Opportunities for further improvement exist => Partially achieved Objectives are met but does not use the competencies to the required standard. Does not meet all objectives but works hard to use the competencies.
Rating 3 : A well rounded and solid performance => Fully achieved All objectives are met and the competencies are used to the required standard. Rating 4 : An excellent performance => Partially exceeded All objectives are met and some are exceeded as the competencies are used to a high standard. Rating 5 : An exceptional performance => Significantly exceeded All objectives are significantly exceeded and the competencies used to a very high standard on a regular basis. The person takes on initiates / new objectives during the year which are also met.
THANK YOU FOR YOUR PARTICIPATION

HR Divisional Business Drivers and KPI Development Workshop

Transféré par

Informations du document

Titre original

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

HR Divisional Business Drivers and KPI Development Workshop

Transféré par

Droits d'auteur :

Formats disponibles

HR Divisional Business Drivers and KPI Development Workshop

HR Divisional Business Drivers & KPI Development Workshop

HR Divisional Business Drivers & KPI Development Workshop

HR Divisional Business Drivers & KPI Development Workshop

What is a Balanced Scorecard?

HR Divisional Business Drivers & KPI Development Workshop

HR Divisional Business Drivers & KPI Development Workshop

HR Divisional Business Drivers & KPI Development Workshop

Alignment & Cascading Business Agenda

HR Divisional Business Drivers & KPI Development Workshop

The Balanced Scorecard concept..

Customer Objectives Measures Targets Initiatives Objectives

Internal Business Process Measures Targets Initiatives

VISION AND STRATEGY

Learning and Growth Objectives Measures Targets Initiatives

HR Divisional Business Drivers & KPI Development Workshop

Learning & Growth Perspective

HR Divisional Business Drivers & KPI Development Workshop

The Importance of Alignment

Revenue Growth Strategy

Improve Cost Structure

Increase Asset Utilization

Enhance Customer Value

Expand Revenue Opportunities

Customer Value Proposition

Customer Management Processes Processes that enhance customer value

Innovation Processes Processes that create new products and services

Learning & Growth

HR Divisional Business Drivers & KPI Development Workshop

Measurement Communicates Values, Priorities And Direction

Measurement Must Be Linked To Strategy

Measurement To Communicate, Not To Control

HR Divisional Business Drivers & KPI Development Workshop

Balanced Scorecard Example

Strategic Theme: Operating Efficiency

How success in achieving the strategy will be measured and tracked

The level of performance or rate of improvement needed

Key action programs required to achieve objectives

On Ground Time On-Time

Learning Ground crew alignment

HR Divisional Business Drivers & KPI Development Workshop

Balanced Scorecard Example

Customer Flight Is on Time Lowest Prices

Internal Fast Ground Turnaround

On Ground Time On-Time

Learning Ground Crew Alignment

70% yr. 3 90% yr. 5 100%

ESOP Ground crew

HR Divisional Business Drivers & KPI Development Workshop

5. Linkage of Initiatives and Measures: Each

HR Divisional Business Drivers & KPI Development Workshop

HR Divisional Business Drivers & KPI Development Workshop

STAR Corporate Role

Department Derived Value (Synergy)

Strategic Objectives Monitoring HR operating expenses

Monitoring Employee Costing

Learning and Growth

Develop skilled workforce

Monitoring HR operating expenses

Monitoring Employee Costing

Monitoring the administrative costing activities

Improve on internal customer satisfaction

Rating vs. internal satisfaction (survey)