For every function in an organization there is client who drives the operations. A customer is kept in mind when designing and implementing strategies. There is one function for which a customer might be hard to find, the HR. The Human Resources team works internally to take care of the proper functioning of the organization. There are four kinds of stakeholders in a firm:

• Customers
• End-users
• Influencers
• Partners

All of them could be termed the customers of HR. Employees are an important component of the stakeholders because they invest their lives working with the firm. While this may answer the question of who the customers are, there is another aspect to build a secure future for the HR.

HR as a successful function is essential for the satisfaction of its “customers”. It has to “sell” itself to its customers in an effective manner. It needs to have a clear business strategy. It can begin with having well defined HR metrics so that all its various service offerings can be quantified and measured. Some of the most useful HR metrics are Human Capital ROI, Profit per Employee, Revenue per Employee, Turnover Costs, Worker’s Compensation Cost per Employee, etc…The metrics must reflect the organizational culture.

A balanced performance measurement system is another critical factor in doing justice to the customers. HR must ensure that the firm attends to more than the financials. Strategy implementation is the causal factor in finance. HR can follow a seven-step process in order to implement its strategic role:

1. Clear definition of Business Strategy
2. Building a business case to prove itself a strategic asset
3. Identifying deliverables
4. Aligning the HR structure with its deliverables
5. Designing the metrics
6. Implementation
7. Follow-up

As for any other practice, development of competencies is the key to good service. For HR, the salient competencies are knowledge, skills, abilities and personality. The major competency domains are knowledge of the business, mastery of HR on a professional level, change management, culture management and credibility. Strategic HR performance management is the new dimension to HR. It involves critical causal thinking, estimation of causal relationships, and communication of performance to the senior managers.

The performance of HR can be assessed using scorecards. One of the leading scorecards is based on objectives like maximizing shareholder value, maximizing human capital performance, minimizing human resource costs, developing and enhancing world-class programs, quality service, responsiveness, capacity building leadership and organizational integration. The advantages of using such a scorecard are marking out the differences between doables and deliverables controlling costs, creating value, measuring indicators, management of strategic responsibilities, and encouraging flexibility and change.