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Assignment: Constructing an HR ScorecardYou have examined the benefits and limitations of the HR Scorecard, and you will now take the knowledge you gained to construct an HR Scorecard for your chosen organization (Starbucks Corporation). You should use the course text for guidance, and you should ensure that your HR Scorecard both offers the benefits outlined in the course text and incorporates feedback you received from your Instructor and/or colleagues in the Discussion area.For this Assignment, you will develop an HR Scorecard using the template provided. Your HR Scorecard should not only look at HR functions, but also the organizational functions (e.g., organization change or sustainability).Please Note:You must use the HR Scorecard Template to complete the scorecard construction portion of the assignment.Below the scorecard construction area of the template discuss in 1-2 pages how the HR Scorecard might be used to demonstrate value creation that aligns with the organization’s strategic goals. Be specific, and provide examples with references to the literature.Resources:Lawler, E. E., III, Jamrog, J., & Boudreau, J. (2011). Shining light on the HR profession. HRMagazine, 56(2), 38–41. Schneider, C. (2006). The new human-capital metrics. CFO Magazine, 22(3), 22–27.
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business LeadershipL
Shining
h
on the
HR Profession
Negotiating layoffs, furloughs and salary freezes during
the recession likely enhanced HR professionals’ strategic
role, power and effectiveness for the long term.
Bv Edward E, L a w k r !I!, lav .[arn'”o:
What has been the effect of the recession on the HR function in organizations? There
is speculation about how it has affected HR departments, but not much data exist on
what happened to HR professionals’ power, strategic role and effectiveness. Let’s
look at two scenarios that describe what might have happened and then look at some
data suggesting that one scenario seems to have occurred most frequently.
When the recession began, HR professionals were struggling with what seems
to be a perpetual credibility and status problem. The popular press was continuing
to characterize the HR function as ineffective, an obstacle to change, overly bureaucratic and failing to add strategic value. Yet for the previous two decades, HR leaders
had responded to critics by trying to become business partners who add value and
help implement business plans. >
38 HR Magazine • February 2011
ÎTRATION BY CHRIS MCALLISTER
February 2011 • HR Magazine 39
Negative Impact
Because of the way HR professionals responded to the recession,
it would not be surprising if the impact on HR professionals’ status and effectiveness has been negative. For example, HR leaders
may have made it difficult for organizations to cut labor costs
and to make other changes that managers sought to deal with the
economic downturn. As a result, HR leaders may have added to
the function’s reputation as an obstacle to change. HR leaders
also may have failed to provide good answers to the tough talent
management questions the recession raised and, as a result, be
seen as poor business partners.
Meanwhile, HR functions in many companies were subject
to significant cost reductions and may not have been able to perform as well as they did before the recession. In short, as a result
of how they reacted to the recession, HR professionals in many
organizations could well be seen as less credible, powerfiil and
effective today than when the recession began.
A Positive View
There is a more positive scenario, however. The recession created a situation where executives in a large number of organizations developed new competencies and capabilities and
changed their strategies. Then they needed to make corresponding changes in the compositions and sizes of their workforces.
The changes needed to adapt to the recession were changes that
HR professionals could lead and contribute to. Who better to
realign the strategy, talent and competencies of an organization
than HR professionals? As Sadie Stem, senior director of human
resources at LG Electronics MobileComm U.S.A. Inc., reflects,
“The recession provided many obstacles for our business and
many opportunities for our HR team.”
If HR leaders stepped up to the plate in the way they
responded to these changes, they could have been operational
drivers who helped reduce costs and strategic drivers who helped
reshape their organizations’ business strategies. HR executives
may have taken advantage of opportunities to demonstrate their
value and to significantly improve their reputation and credibility as well as that of the HR function.
and what steps HR professionals took to deal with the recession.
The results of the survey paint a positive picture of what happened to the HR functions in most organizations. HR executives
were asked how the HR functions in their companies changed as
a result of how they responded to the recession. In only a small
percentage of companies did the recession result in a decrease in
the strategic role, power and effectiveness of the HR function. In
most organizations, HR professionals’ ratings either stayed the
same or increased in these areas. HR gained power and status,
became more strategic, and improved effectiveness in more than
a quarter of the companies surveyed.
In short, the data strongly suggest that the HR function was
more likely to see an increase in power, effectiveness and strategic role than to see a decrease as a result of how HR executives responded to the recession. But—and it is a big but—these
data come from HR managers who may well be guilty of wishful
thinking rather than being accurate reporters of what happened.
To assess HR executives’ credibility, we need to look at what
other managers in their organizations report. The findings from
this second group are similar to the results from HR executives.
Thus, there seems to be consensus that the HR function was
more likely to improve effectiveness than to decrease it as a result
of what practitioners did during the recession. The high level
of agreement among HR executives and other executives is an
important finding. It suggests—despite what is often said—that
HR executives know what goes on; they are not out of touch.
HR Changes
To get a sense of what HR professionals did to improve their status and effectiveness, we asked how the HR functions changed
operations. Our analysis shows that a number of changes
are strongly related to the degree to which HR departments
improved their effectiveness during the recession. There are no
Recession Impact
As reported by HR executives:
No Change
or Stayed
the Same
Increased
Decreased
No Change
or Stayed
the Same
Increased
7.4%
2.9
14.4
67.6%
67.6
59.4
25.0%
29.4
26.0
Decreased
What Happened
To assess how the HR function has been affected by the recession,
and practitioners’ response to it, we distributed a survey answered
by slightly less than a thousand HR executives and other types of
managers in U.S. corporations that range in size from 1,000 to
more than 100,000 employees. We asked how the HR functions
have changed in their organizations as a result of the recession
Edward E. Lawter ¡IT is director at the Center for Effective Organizations and a
professor at the Marshall School of Business, University of Southern California,
in Los Angeles. Jay Jamrog is senior vice president of research at the Institute
for Corporate Productivity in St. Petersburg, Fla. John Boudreau is research
director at the Centerfor Effective Organizations and a professor at the Marshall
School of Business.
40 HR Magazine • February 2011
Power and status of HR function
Strategic role of HR function
Effectiveness of HR function
14.9%
14.0
i
Recession Impact
As reported by managers:
Power and status of HR function
Strategic role of HR function
Effectiveness of HR function
_BusiQess Leadership
surprises here, but there are some reminders of wbat HR professionals need to do.
Many changes that led to HR professionals improving their
positions and functions involve practices and strategies that HR
leaders said they want to put in place and have been advised to
do for decades. Let’s briefly review the changes most strongly
related to improvements in the effectiveness of tbe HR function.
Talent management. Changes in talent management are
most strongly related to improving etfectiveness. HR executives
who report that their organizations made stronger commitments
to talent management and improving the quality of their talent
management decisions showed the most improvement in tbe
effectiveness of their HR functions. This provides one more confirmation that HR leaders must be expert talent managers.
Qualcomm is an example of a company whose HR professionals increased their focus on talent. According to Tamar
Elkeles, vice president of learning and development, Qualcomm
has redesigned its leadership development suite of programs to
strengthen its leadership team and build a pipeline.
The survey results also confirm the importance of performance management. Respondents who reported a greater focus
on performance management were likely to see improvements in
the status and effectiveness of the HR ñinction. No wonder: Having a performance management system that produces accurate
data about the condition of an organization’s talent is fundamental to making many of the decisions that leaders need to make
during economic change and turmoil.
Analytics and metrics. HR leaders who emphasize numbers
tended to see the biggest gains in tbe power and effectiveness of
their HR functions. Therefore, to be seen as a credible function,
HR leaders need data and analytics that show how effectively
the HR organization operates and how talent management systems perform.
Innovation. There were strong relationships between willingness to change and improvements in the status and effectiveness
of tbe HR function. HR organizations whose leaders reported
increased willingness to try innovative HR activities showed
large gains in status and effectiveness. Given tbe customary criticism of HR professionals for not being willing to innovate, these
tindings represent a confirmation of the reality that HR professionals need to be open to new practices.
3M Co. provides an example of an organization that made
changes during tbe recession. “Our employee engagement initiative has been really helpful in opening up the channels of communications. We have been recreating and rethinking everything
from total compensation to our employment brand,” says Sandra K. Tokach, senior vice president of HR talent solutions.
Regarding innovation, we asked about two kinds of changes
that HR professionals could make: We questioned tbe use of
short-term fixes to solve HR problems created by the recession,
and we asked about practices that had clear and tangible results.
The data sbow tbat short-term fixes sucb as freezing wages had
In only a small percentage of
ns did the recession
result in a decrease in the
strategic role, power and
effectiveness of the HR fun
relatively little impact on tbe power, status and effectiveness of
tbe HR function. Those organizations where HR professionals
emphasized short-term fixes gained slightly more than those tbat
didn’t, but it wasn’t a strong relationship. The stronger relationship was associated with increasing the use of practices that have
tangible results. The more HR professionals focused on practices
producing tangible results, the more they gained in power, status
and effectiveness.
One change was unrelated to tbe effectiveness of the HR
function: spending more time on administration. The types of
changes tbat organizations need to make in recessions cannot be
accomplished this way. Good administration is needed to implement change, but there are more important and higher areas of
payoff that HR leaders should focus on to increase tbeir status
and effectiveness.
Not Limited to Recession
Our results are good news for the HR profession. They suggest
tbat the HR ñjnction has improved its position in many organizations as a result of how practitioners responded to the recession. They also indicate the paths that HR leaders need to follow
to continue to improve effectiveness. Tbe results strongly suggest
tbat a commitment to talent management, use of analytics and
metrics, and the willingness to try new practices should be part
of HR ñinctions in the future.
A note of caution: It is possible that the practices that led to
tbe HR functions being more effective in this study are only good
in times of recession. However, this seems highly unlikely. Our
view is tbat they are good for all seasons. They should become
part of the competencies and capabilities of HR leaders, regardless of tbe economy. They are just the capabilities tbat managers
have been calling for HR professionals to develop for decades
and tbat critics bave said are missing. Our data on the reaction of
HR professionals to tbe recession provides evidence that if HR
leaders embrace talent and performance management, analytics
and metrics, and innovation, they are likely to gain considerably
in power, status and effectiveness.
Finally, note that many HR leaders were able to increase their
performance management, analytics and talent development
activities despite companywide budget cuts. The fact tbat they
were able to do so shows that business leaders consider tbese
activities priorities. Post-recession, this suggests that there may
be increased financial support for human resources if HR leaders
commit to strengthening performance management, analytics
and talent development activities. OB
February 2011 • HR Magazine 41
Copyright of HRMagazine is the property of Society for Human Resource Management and its content may not
be copied or emailed to multiple sites or posted to a listserv without the copyright holder’s express written
permission. However, users may print, download, or email articles for individual use.
Using the following template, create a HR scorecard for the company that you have been examining this term:
HIGH PERFORMANCE
WORK SYSTEM

HR SYSTEM
ALIGNMENT

HR DELIVERABLES

IMPACT
HR EFFICIENCY

Adapted from Figure 3-1:
Becker, B., Huselid, M., & Ulrich, D. (2001). The HR scorecard: Linking people, strategy, and performance. Boston, MA: Harvard Business School
Press.
In 1-2 pages below discuss how the HR Scorecard might be used to demonstrate value creation
that aligns with the organization’s strategic goals. Be specific, and provide examples with
references to the literature.
business LeadershipL
Shining
h
on the
HR Profession
Negotiating layoffs, furloughs and salary freezes during
the recession likely enhanced HR professionals’ strategic
role, power and effectiveness for the long term.
Bv Edward E, L a w k r !I!, lav .[arn'”o:
What has been the effect of the recession on the HR function in organizations? There
is speculation about how it has affected HR departments, but not much data exist on
what happened to HR professionals’ power, strategic role and effectiveness. Let’s
look at two scenarios that describe what might have happened and then look at some
data suggesting that one scenario seems to have occurred most frequently.
When the recession began, HR professionals were struggling with what seems
to be a perpetual credibility and status problem. The popular press was continuing
to characterize the HR function as ineffective, an obstacle to change, overly bureaucratic and failing to add strategic value. Yet for the previous two decades, HR leaders
had responded to critics by trying to become business partners who add value and
help implement business plans. >
38 HR Magazine • February 2011
ÎTRATION BY CHRIS MCALLISTER
February 2011 • HR Magazine 39
Negative Impact
Because of the way HR professionals responded to the recession,
it would not be surprising if the impact on HR professionals’ status and effectiveness has been negative. For example, HR leaders
may have made it difficult for organizations to cut labor costs
and to make other changes that managers sought to deal with the
economic downturn. As a result, HR leaders may have added to
the function’s reputation as an obstacle to change. HR leaders
also may have failed to provide good answers to the tough talent
management questions the recession raised and, as a result, be
seen as poor business partners.
Meanwhile, HR functions in many companies were subject
to significant cost reductions and may not have been able to perform as well as they did before the recession. In short, as a result
of how they reacted to the recession, HR professionals in many
organizations could well be seen as less credible, powerfiil and
effective today than when the recession began.
A Positive View
There is a more positive scenario, however. The recession created a situation where executives in a large number of organizations developed new competencies and capabilities and
changed their strategies. Then they needed to make corresponding changes in the compositions and sizes of their workforces.
The changes needed to adapt to the recession were changes that
HR professionals could lead and contribute to. Who better to
realign the strategy, talent and competencies of an organization
than HR professionals? As Sadie Stem, senior director of human
resources at LG Electronics MobileComm U.S.A. Inc., reflects,
“The recession provided many obstacles for our business and
many opportunities for our HR team.”
If HR leaders stepped up to the plate in the way they
responded to these changes, they could have been operational
drivers who helped reduce costs and strategic drivers who helped
reshape their organizations’ business strategies. HR executives
may have taken advantage of opportunities to demonstrate their
value and to significantly improve their reputation and credibility as well as that of the HR function.
and what steps HR professionals took to deal with the recession.
The results of the survey paint a positive picture of what happened to the HR functions in most organizations. HR executives
were asked how the HR functions in their companies changed as
a result of how they responded to the recession. In only a small
percentage of companies did the recession result in a decrease in
the strategic role, power and effectiveness of the HR function. In
most organizations, HR professionals’ ratings either stayed the
same or increased in these areas. HR gained power and status,
became more strategic, and improved effectiveness in more than
a quarter of the companies surveyed.
In short, the data strongly suggest that the HR function was
more likely to see an increase in power, effectiveness and strategic role than to see a decrease as a result of how HR executives responded to the recession. But—and it is a big but—these
data come from HR managers who may well be guilty of wishful
thinking rather than being accurate reporters of what happened.
To assess HR executives’ credibility, we need to look at what
other managers in their organizations report. The findings from
this second group are similar to the results from HR executives.
Thus, there seems to be consensus that the HR function was
more likely to improve effectiveness than to decrease it as a result
of what practitioners did during the recession. The high level
of agreement among HR executives and other executives is an
important finding. It suggests—despite what is often said—that
HR executives know what goes on; they are not out of touch.
HR Changes
To get a sense of what HR professionals did to improve their status and effectiveness, we asked how the HR functions changed
operations. Our analysis shows that a number of changes
are strongly related to the degree to which HR departments
improved their effectiveness during the recession. There are no
Recession Impact
As reported by HR executives:
No Change
or Stayed
the Same
Increased
Decreased
No Change
or Stayed
the Same
Increased
7.4%
2.9
14.4
67.6%
67.6
59.4
25.0%
29.4
26.0
Decreased
What Happened
To assess how the HR function has been affected by the recession,
and practitioners’ response to it, we distributed a survey answered
by slightly less than a thousand HR executives and other types of
managers in U.S. corporations that range in size from 1,000 to
more than 100,000 employees. We asked how the HR functions
have changed in their organizations as a result of the recession
Edward E. Lawter ¡IT is director at the Center for Effective Organizations and a
professor at the Marshall School of Business, University of Southern California,
in Los Angeles. Jay Jamrog is senior vice president of research at the Institute
for Corporate Productivity in St. Petersburg, Fla. John Boudreau is research
director at the Centerfor Effective Organizations and a professor at the Marshall
School of Business.
40 HR Magazine • February 2011
Power and status of HR function
Strategic role of HR function
Effectiveness of HR function
14.9%
14.0
i
Recession Impact
As reported by managers:
Power and status of HR function
Strategic role of HR function
Effectiveness of HR function
_BusiQess Leadership
surprises here, but there are some reminders of wbat HR professionals need to do.
Many …
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