PCMMHR ScorecardSix Sigma

Module # 5

PCMM –concept

• The People CMM is a maturity framework that describes the key elements of managing and developing the workforce of an organization.

• It describes an evolutionary improvement path from an ad hoc approach to managing the work-force, to a mature, disciplined development of the knowledge, skills, and motivation of the people that fuels enhanced business performance

P-CMM Objectives

• To improve organisational capability by improving workforce capability.

• To align the motivation of individuals with that of the organisation.

• To help retain people with critical knowledge and skills.

Benefits

• characterize the maturity of their human resource practices

• set priorities for improving the competence of its work-force

• integrate competence growth with process improvement

• establish a culture of workforce excellence

P-CMM levels

• Five stage model• Initial. Ad-hoc people management• Repeatable. Policies developed for capability

improvement• Defined. Standardised people management across the

organisation• Managed. Quantitative goals for people management in

place• Optimizing. Continuous focus on improving individual

competence and workforce motivation

The people capability model

Continuous workforce innovationCoachingPersonal competency development

Organisational performance alignmentOrganisational competency managementTeam-based practicesTeam buildingMentoring

Managed

Optimizing

Participatory cultureCompetency-based practicesCareer developmentCompetency developmentWorkforce planningKnowledge and skills analysis

CompensationTrainingPerformance managementStaffingCommunicationWork environment

Initial

Repeatable

Defined

Continuously improve methodsfor developing personal andorganisational competence

Quantitatively manageorganisational growth inworkforce capabilities andestablish competency-basedteams

Identify primarycompetencies andalign workforceactivities with them

Instill basicdiscipline intoworkforceactivities

PCMM in areas like

• Work environment • Communication • Staffing • Managing performance • Training • Compensation • Competency development • Career development • Team building • Culture development

What is Six Sigma?

• Six Sigma is a highly disciplined process that helps in focusing on developing and delivering near-perfect products and services.

• The word sigma is a statistical term that measures how far a given process deviates from perfection.

• The central idea behind Six Sigma is that if you can measure how many "defects" you have in a process, you can systematically figure out how to eliminate them and get as close to "zero defects" as possible.

What is Six Sigma?

• To achieve Six Sigma Quality, a process must produce no more than 3.4 defects per million opportunities.

• An "opportunity" is defined as a chance for nonconformance, or not meeting the required specifications.

• Which means we need to be nearly flawless in executing our key processes.

Key Concepts of Six Sigma

Six Sigma revolves around a few key concepts.

• Critical to Quality: Attributes most important to the customer

• Defect:Failing to deliver what the customer wants• Process Capability: What your process can deliver• Variation:What the customer sees and feels• Stable Operations: Ensuring consistent, predictable

processes to improve what the customer sees and feels• Design for Six Sigma: Designing to meet customer

needs and process capability

HR scorecard

• HR scorecard measures the HR function's effectiveness and efficiency in producing employee behaviors needed to achieve the company's strategic goals. In order to achieve that one need to: • Know what the company's strategy is

• Understand the causal links between HR activities, employee behaviors, organizational outcomes, and the organization's performance

• Have metrics to measure all the activities and results involved.

HR scorecard process

1. Define the business strategy.2. Outline the company’s value chain

• Here the manager identifies the strategically relevant outcomes and required employee behaviors by identifying the value chain,

• This step allows managers to better understand the activities that drive performance in their company.

3. Identify the strategically required organizational outcomes• In order to achieve its strategic goals, every company must

produce critical, strategically relevant outcomes.

HR scorecard process

4. Identify the required workforce competencies and behaviors• Competencies and behaviors such as personal accountability,

working proactively, motivation, courteous behavior, and commitment drive organizational performance by producing strategically relevant organizational outcomes.

5. Identify the strategically relevant HR system policies and activities• HR system policies and activities which will enable us to

produce those workforce competencies and behaviors.• These policies and activities are often referred to as “HR

enablers”, which create and make possible the HR ”performance drivers”.

HR scorecard process

6. Design the HR Scorecard measurement system• how the organizational outcomes, workforce

competencies and behaviors, and HR system policies and activities measured

7. Periodically evaluate the measurement system• The HR Scorecard’s various measures will not always

stay the same, and should be evaluated periodically to ensure they are still valid

Score card process

Balanced Scorecard

• The Balanced Scorecard identifies four key perspectives that directly and completely define strategy measurement and analysis.

• They include the • financial perspective, • the customer perspective (e.g. customer

loyalty and satisfaction), • the internal processes perspective (e.g.

process quality and process cycle time) • learning and growth perspective (e.g.

employee skills) that is the leading indicator.

Score card measures

Financial Perspective

• relating to the financial measures that demonstrate how people and the HR function add value to the organization• Compensation and benefits per employee.

• HR expenses per employee.• Turnover cost.• Profit per employee.• Cost of injuries…

Internal process Perspective

• The strategic perspective focuses on the measurement of the effectiveness of major strategy-linked people goals.

• HR budget / actual.• HR annual resource plan.• Change management capability of the organization• Skills/ competency level…

Operational Perspective

• The operational tasks at which HR must excel• Training cost per employee

• Training hours per employee• Average employee tenure in the company• Lost time due to injuries• Time taken to fill vacancies• Cost per recruitment promotions• Absenteeism by job category• Accident costs• Accident safety ratings

Customer Perspective

• This focuses on the effectiveness of HR from the internal customer viewpoint• Employee perception of the HRM

• Employee perception of the company , as an employer• Customer/market perception of the company

Benefits

• It reinforces the distinction between HR do-ables and deliverables

• It measures leading indicators

• It assesses HR’s contribution to strategy implementation

• It lets HR professionals effectively manage their strategic responsibilities

• It encourages flexibility and change

References

1. www.hrfolks.com/Articles/.../human%20resources%20scorecard.pdf

2. www.bpoindia.org/research/pcmm-model.shtml

3. www.p-cmm.com

THANK YOU