HR benchmarked on efficiency can lead to strategic mistakes. Impact-based benchmarking fixes that. Learn about the dangers of benchmarking HR only on cost-based ratios, and how to avoid the dangers through more impact-based budgeting.
- Are you trying to benchmark your way to an HR strategy?…A benchmark was originally a chiseled cut…in a stone structure creating a bench…for a leveling rod.…That way, level was measured the same every time.…In business, benchmarks let you see…what other organizations do and compare…your organization to them.…For example, in marketing, a benchmark might compare…you and another organization on the percent…of your advertising budget you spend online.…
That's useful information but you wouldn't just allocate…your advertising budget to match your competitor.…You know that your unique strategic payoff…from online advertising might justify spending more…or less than your competitors.…In HR, typical benchmarks compare things like…cost per hire or training days per employee.…Unlike marketing, when it comes to HR,…leaders are tempted to match the benchmark.…Particularly when the benchmark…is from an admired organization,…the logic is that organization is very successful,…so let's do HR the way they do HR.…
An HR strategy based on matching benchmarks has two flaws.…
- Arrange the questions of HR strategy in order of importance.
- Define “pivotal” within the context of the course.
- Identify three key questions that help clarify and focus organizational strategy.
- Define the term “bottleneck.”
- Name four characteristics a person might have that supports improved work performance.
- Explain the importance of an HR budget that aligns with HR strategy.
- Describe the three energy profiles and how they can be used to create a balance in HR strategy.