Final answer:
The HR Scorecard is not limited to diagnosing internal fit; it also evaluates how HR practices align with business strategy and impact performance, thus serving both internal and external organizational needs.
Step-by-step explanation:
The statement that the HR Scorecard can only be used to diagnose internal fit is false. The HR Scorecard is a comprehensive tool designed to assess and demonstrate how human resource practices contribute to the strategic objectives of an organization. Not only does it examine internal processes and practices, but also it looks at how HR impacts business performance and outcomes, aligning HR systems with business strategy to ensure that both internal and external organizational needs are met.
By using the HR Scorecard, organizations can evaluate the effectiveness of HR interventions and their repercussions on the overall company performance. This involves looking at external alignment, such as how well HR practices are supporting the strategies and competitive environment the organization faces. Thus, the HR Scorecard is used for analyzing both internal and external alignment, making it a versatile tool for strategic human resource management.