Balanced ScoreCard

Client Success Story: Balanced ScoreCard

"Measurement is essential to engage employees and modify behavior."

Background

The CEO of a vertically integrated global petroleum corporation had established an aggressive five year earnings growth target. A key element in the strategy to achieve these goals was to fully engage all employees in a meaningful manner. The CEO implemented the Balanced Score Card to create focus and visibility into the initiative.

Each organizational unit was required to develop a pair of mission success indicators for the CEO's Score Card that would represent the overall performance of the unit. The Human Resources function was having difficulty identifying the proper metrics to measure their contribution to the corporation. After several internal efforts, they looked outside for assistance.

Assignment

ISG was selected to provide assistance in developing the Human Resource score card. We were selected because of the simplicity of our development process, the rapid rate at which the assignment could be completed, and the high level of measurement detail that would be delivered to the client for use as a tactical tool.

The process was to develop a “bottom-up” ScoreCard with measures that reached up to the corporate strategy. During four half-day working sessions, a total of twenty six measurement sets were developed for the nine departments within HR. Based on this work it was possible to develop two composite measures to represent HR’s overall contribution on the Corporate balanced score card.

Results

The VP of HR received a complete measurement system to monitor the effectiveness of the HR organization. This system consisted of two mission success indicators and a dashboard of key performance indicators for each HR function. Each function in HR now had a ScoreCard that provided line-of-sight to the corporate Balanced Score Card. During the process the management team developed greater insight into HR's responsibility to contribute to profit through effective HR practices.