The Importance of Benchmarking in Human Resource Management

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Metrics and analysis have been useful in ensuring that the human resource function thrives in organizations. Metrics are informational by nature as they focus on presenting past data with the intention of providing insights and perspectives to the management team and employees within the organization. Hence metrics give essential ideas over systemic, operational and functional areas within the business. Analysis, on the other hand, is a strategic tool for ensuring that the past and present data give predictions, optimizations, and insights for critical decision making. Hence metrics are used for analysis to promote strategic human resource decision making.

What is benchmarking?

Benchmarking aims at continuously improving the processes of the organization hence it comes out as a strategic tool for human resource management. Benchmarking is not a one event activity as it involves a comprehensive and continuous process that is aimed at ensuring that the human resource functions throughout the organization are optimized (Rohlfer, 2017). The first step is to assess the internal process that needs to be changed within the group. Once these methods have been identified, the human resource department is tasked to ensure that they recognize organizations that are thriving with regards to their processes and incorporate or adopt these programmes to improve the internal standards.

What are scorecards and dashboards?

Scorecards are metrics of performance measurement that determine whether the company is on track to achieving its objectives. Scorecards apply to the entire organization and mainly focuses on the key areas such as customer satisfaction, market share, shareholder value and employee commitment. These are mostly non-financial metrics of the scorecard. The financial aspects of the scorecard focus on whether the organization is on course of meeting its financial objectives which are mainly cost minimization and revenue maximization. Performance dashboards on the other hand focus on whether the individual employees are meeting their key performance indicators in line with the overall organization objectives. The dashboards provide information and insights that are key to ensuring that the organization manages employee performance.

How are those tools being utilized in HRM context? Bring in private-sector employer examples found in your readings/ research (stating employers by name)

Benchmarking has proven to be one of the most effective forms of human resource management. Organizations benchmark across industries and organizations of similar structure to learn from the best and improve their processes and structure. Hence, benchmarking has been a critical strategy of enhancing total quality management especially with regards to strengthening human resource processes and practices. For example, Google has been one of the top organizations that have used benchmarking to continuously improve their human resource processes and structures. As the company was growing and evolving, they realized that they were losing some of their top employees to rival companies. As a result, they decided to implement a robust system where they would redefine their organizational structure to accommodate the best talent and even improve their pay structure.

Organizations should develop the best metrics that they wish to compare with the top performers and the objectives they want to achieve to ensure that they meet the goals of benchmarking. Hence, the setting out of the purposes clearly makes the benchmarking process specific and aids the management team in achieving their objectives (Zhenjia & Qiumei, 2005). Coca-Cola has also stood out to be an industry pacesetter with regards to having a healthy and robust human resource management strategy. The company has been known to benchmark across the group especially as the company expands to different markets which have enabled them to streamline their human resource processes. Hence, the companies that have been benchmarking have managed to continuously improve their human resource structures to become market leaders in everything that they do. Also, improved human resource processes have propelled them to achieve their corporate objectives since people play a critical role in ensuring that the organization succeeds.

Performance management is critical in strategic human resource management (Akinnusi, n.d.). Balance scorecard is one of the essential tools that the human resource managers use to measure whether the organization is performing primarily at the department and employee level. Also, balanced scorecard, as a metric of performance has been widely appreciated by human resource managers and experts for enhancing innovation within the company. Consequently, companies that are competing in the technology and innovative space have found it very useful to apply the balance scorecard to ensure that the performance of the company increases over time. Apple Inc is one of the great corporations that have actively used the balance scorecard method to provide that the employees are motivated to offer innovative solutions (Sullivan, 2011) continuously.

Moreover, the balance score card has proven to be very useful since it covers a broad spectrum of the various aspects of the business such as shareholder value, market share, employee commitment and customer satisfaction. As a result, the metric of performance ensures that the strategic objectives of the organization are aligned with the human resource function of the body since people play a crucial role in providing that the business succeeds. Furthermore, the performance scorecard empowers the management of the organization to develop key performance indicators that are in line with the strategic objectives of the team that satisfies the various stakeholders such as customers, shareholders, and employees.

The balanced scorecard has also proven to be a useful metric of performance measurement since it ensures that the financial objectives of the organization are achieved such as cost minimization and revenue maximization. Starbucks Corporation has been on the forefront of succeeding especially since they have been active with regards to applying the balanced scorecard to measure and evaluate the performance of the employees which is a core function of strategic human resource management.

Offer your sights on the topic and its implications for HR

The issue of metrics and analysis has the great impact on human resource management. The human resource management function cannot be strategic without data. Hence, it is critical for the organizations to ensure that they apply the different metrics of performance measurement such as dashboards and balanced scorecards to provide information on the employee performance together with the total production of the organization (Kaplan & Norton, 1993). Furthermore, to improve the human resource function of the team as a whole, the application of strategies such as benchmarking ensures that the group is on course to continuously improve their processes to make the human resource function more strategic, retain and hire the best talent and improve the internal operations of the organization. Therefore, when agencies have structures that offer them feedback on the human resource processes, they can continuously develop, grow and innovate.


Akinnusi, D. Benchmarking of human resource management in the public sector: Prospects, problems and challenges. SA Journal Of Human Resource Management, 6(6), 25-31.

Kaplan, R., & Norton, D. (1993). Putting the Balanced Scorecard to Work. Harvard Business Review. Retrieved from

Rohlfer, S. (2017). The different faces of benchmarking: structural limits to benchmarking and the implications for Human Resource Management. Warwick Business School. Retrieved from

Sullivan, J. (2011). Talent Management Lessons From Apple: A Case Study of the World’s Most Valuable Firm (Part 1 of 4). ERE Recruiting Intelligence. Retrieved from

Zhenjia, Z., & Qiumei, F. (2005). Benchmarking in Human Resource Management. Canadian Social Science, 1(1).

January 19, 2024


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