The HR Scorecard model is derived from Balanced Scorecard model given by Norton and Kaplan. This model provides the unique tool to the HR managers to meet the specific needs of HR. The HR scorecard plays a vital role in understanding that how specific decisions and actions of HR to provide support to the overall strategy of the organization (Becker, Huselid,. & Ulrich, 2001).
In the today’s world the face of business has been changed and shifted from tangible assets to more towards internal resources and capabilities of the organization. The competitive advantages are basically based on the ability to develop and retain a capable and committed workforce (Colbert 2004). It is because the intangible factors are more important and rivals cannot imitate them easily. The HR Scorecard is the most powerful strategic tool (Becker, Huselid,. & Ulrich, 2001).
The HR Scorecard provides the asset to the HR professionals so that they can understand that how their function can be helpful to other units and help them in implementing their own strategies. The other major aspect that this tool provides to the HR managers is that how the different policies and practices of the organization’s HR are align with each other to enable the HR managers to support the strategies of other units and that of corporation.
The arrangement among HR practices and policies, company functions and the top management creates a strong network that display cause and effect connections. This network connection successfully allows all the employees and managers to understand the mission of the organization and carry out in a better way. HR Scorecard also empowers the professionals to demonstrate the working of HR department that how it is contributing towards organization’s financial success.