Don’t judge HR on bottom line

Measuring the performance of HR by assessing its contribution to a company’s
bottom line is an inappropriate way to judge the function, claimed a leading HR
academic at a CBI conference in London last week.

Chris Brewster, professor of international human resources at Cranfield
School of Management, is convinced that the different timescales used by
business and HR to measure success makes performance difficult to assess.

Brewster said, "Business wants to see a return within a year, sometimes
six months, while HR says it will expect to see a pay off within five to 10
years. Line managers are uncomfortable with these different timescales."

He added, "Not enough organisations attempt performance measuring HR and
profits. There is enough proof around that the two are connected. HR practices
are linked to commitment, productivity, quality and flexibility – this all has
a direct impact on financial performance."

Speaking at the CBI conference called Making the Connection: People
Management and the Bottom Line, Brewster said HR must understand the values of
its organisation. He said policies simply based on best practice models
"do not travel well".

He said, "Instead of best practice models, HR should look at fitting
practices to fit the culture of your own company."

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