Thursday, August 4, 2005

Measures for learning & growth

Business Times p.B4
Thursday, August 04, 2005

By Moje Ramos-Aquino, FPM
Measures for Learning and Growth

BACK to our discussion of the Balanced Scorecard and this time we shall concentrate on Learning and Growth perspective. Although we have lengthily discussed the other four perspectives—Financial, Customer and Internal Business Process—we will be going back to them as the need arises or if there are interesting and useful new materials or benchmarks.

According to the author Paul Niven (Balanced Scorecard Step-by-Step) the measures in the Learning and Growth perspective are enabler of all other measures in the Scorecard, forming the foundation on which this entire house of a Balanced Scorecard is built. Also that once you identify measures and related initiatives in your Customer and Internal Process perspectives, you can be certain of discovering some gaps between your current organizational infrastructure of employee skills and information systems, and the level necessary to achieve your results (in the other three perspectives). Likewise, Niven said that the measures you design in this perspective will help you close the gap and ensure sustainable performance for the future.

Learning and Growth perspective is a mix of lag and lead measures in the areas of employee skills, employee satisfaction, availability of information and alignment; ergo, it should not be overlooked. Niven offers the metaphor of a tree: Think of them as the roots of a tree that will ultimately lead through the truck of internal process to the branches of customer results and finally to the leaves and fruits of financial returns.

Niven suggests this Learning and Growth measures.

• Employee participation in professional or trade associations
• Training investment per customer
• Average years of service
• Number of cross-trained employees
• Employee suggestions
• Employee satisfaction
• Participation in stock ownership plans
• Lost time accidents
• Value added per employee
• Motivation index
• Outstanding number of applications for employment
• Diversity rates
• Empowerment index
• Quality of work environment
• Internal communication rating
• Employee productivity
• Health promotion
• Training hours
• Competency coverage ration
• Personal goal achievement
• Leadership development
• Communication planning
• Reportable accidents
• Percentage of employees with computers
• Strategic information ration
• Cross-functional assignments
• Knowledge management
• Ethics violations

In their book The Workforce Scorecard, authors Mark Huselid, Brian Becker and Richard Beatty identified hundreds of measures for managing human capital to execute strategy. Some measures for Right HR Practices are:

• Percent of non-entry level jobs that have been filled from within in recent or over the last x number of years
• Percent of average employee’s total compensation (wages + benefits) that is accounted for by all forms of variable pay
• Percent of the workforce for which “A” and “C” performance evaluations have been accurately assessed
• Percent of employees that owns shares of the company’s stock
• Percent of the workforce that is included in a formal information-sharing program designed to communicate critical business and operational goals
• Proportion of absenteeism
• Proportion of internal transfers
• Retention rate of “A” players in key positions
• Retention of “A” players in noncore positions
• Senior manager and board member diversity
• Time to competence for new hires
• Time to promotion for “A” players
• Time to promotion for “C” players
• Performance of newly hired applicants
• Percent of the workforce that routinely performs its job as part of a self-managed, cross-functional, or project team
• Percent regrettable turnover
• Percent total salary at risk

Next week, we will go back to Sumiden and how their Bible-based culture is helping them toward their journey to business excellence.

Thank you to RC Diliman president Bert Tato and First Philippine Holdings Corp.’s Zeny Tanada for their sponsorship of teachers to our Accelerated Learning Workshop, a literacy project of the Rotary Club of Quezon City North. Studies reveal that in the entire teaching life of an elementary teacher, he/she will directly touch the heart, mind and soul of, at least, 5,000 students and many more indirectly by her example. RCQCNorth believes that it is important to take care of the teacher to enable them to take care of their students. Please support this project. Gawa, hindi ngawa!

(Moje, president of Paradigms & Paradoxes Corp. and RCQCNorth, awaits your feedback at

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