I think he means the man in Brown with spikey orange hair, but I actually get right away that you are showing who is selected and choosing what action to take. Since the same character is up in the battle, this is what I assume anyway. Maybe you could Cut off his head and place it Next to the HP. So you can tell whose turn it is, but it wont look like a random NPC out of place.
My question is about the yellow arrows. Why are they all there? If its a selection menu, wouldnt you just select the one item, and move the arrow as you select new ones?