1. SHRM Poll: Challenges Facing Organizations
and HR in the Next 10 Years
September 16, 2010

2. Key Findings
• Getting and Making the Most of Human Capital Is a Key Priority. The biggest
investment challenges facing organizations over the next 10 years are 1) obtaining
human capital and optimizing human capital investments (47%), 2) obtaining financial
capital and optimizing financial capital investments (29%), and 3) obtaining intellectual
capital and optimizing intellectual capital investments (12%).
• To Attract and Keep the Best Talent, Organizations Should Allow Flexible Work
Arrangements. Providing flexibility for employees to balance their life and work
responsibilities is the most effective way to attract, reward and retain top performers,
according to 58% of HR managers.
• Cultivate a Culture of Trust, Open Communication and Fairness. Creating an
organizational culture where trust, open communication and fairness are emphasized
and demonstrated by leaders is a key human capital strategy.
• Keep a Clear Line of Sight Between Employees’ Work and Organizational
Objectives. 40% of HR managers say that designing jobs to provide employees with
meaningful work that has a clear purpose in meeting the organization’s objectives
optimizes the organization’s ability to engage and keep top talent.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 2

3. What do you think will be the biggest investment challenge facing
organizations over the coming 10 years?
Obtaining human capital and optimizing human capital
47%
investments
Obtaining financial capital and optimizing financial capital
29%
investments
Obtaining intellectual capital and optimizing intellectual
12%
capital investments
Obtaining technology and optimizing technological capital
11%
investments
Obtaining physical capital (e.g., factories, buildings,
trucks, tools, machinery and equipment) and optimizing 2%
physical capital investments
0% 10% 20% 30% 40% 50%
Note: n = 449. Percentages do not total 100% due to rounding.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 3

4. What do you think will be the biggest investment challenge facing
organizations over the coming 10 years?
Comparison by Organization’s Operations Location and Union Status
• Obtaining financial capital and optimizing financial capital investments (by operations): Organizations with
U.S.-based operations (31%) were more likely than organizations with multinational operations (20%) to cite
obtaining financial capital and optimizing financial capital investments as a major investment challenge facing
organizations over the coming 10 years.
• Obtaining financial capital and optimizing financial capital investments (by union status): Organizations with
unionized employees (40%) were more likely than non-unionized (26%) organizations to report obtaining financial
capital and optimizing financial capital investments as the biggest investment challenge facing organizations over the
coming 10 years.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 4

5. A 2010 survey of global C-suite executives, Company of the Future, commissioned
by SHRM with the Economist Intelligence Unit, found that C-suite executives
believe the two biggest challenges facing HR over the coming 10 years will be:
1. Retaining and rewarding the best people.
2. Attracting the best people to the organization.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 5

6. According to HR professionals, the most effective tactics of meeting the
identified challenges of retaining and rewarding the best people and
attracting the best people to the organization are:
Providing flexibility to balance life and work 58%
Creating an organizational culture where trust, open communication and fairness
are emphasized and demonstrated by leaders 47%
Having jobs designed to provide employees with meaningful work that has a
clear purpose in meeting the organizations’ objectives 40%
Demonstrating a commitment to employee development 29%
Offering a higher total rewards package (i.e., total compensation and benefits
package) than organizations that compete for the same talent 23%
Creating a stimulating and attractive organizational culture 21%
Creating an organizational culture where employees are encouraged to make
decisions and take risks 15%
Providing employees better opportunities to use their skills and abilities 14%
Developing human capital managers at all levels of the organization 13%
Creating a highly inclusive culture that uses diverse perspectives to optimize
organizational performance 11%
Providing employees with the latest tools to maximize work efficiency and
effectiveness 11%
Demonstrating the organization’s commitment to corporate social responsibility
and sustainability 4%
Other 1%
0% 10% 20% 30% 40% 50% 60%
Note: n = 449. Percentages do not total 100% as multiple response options were allowed. Respondents were asked to select up to three tactics.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 6

7. According to HR professionals, the most effective tactics of meeting the
identified challenges of retaining and rewarding the best people and
attracting the best people to the organization are:
Comparison by Organization’s Sector
• Creating an organizational culture where trust, open communication and fairness are emphasized and
demonstrated by leaders (by sector): Nonprofit (63%) organizations were more likely than publicly owned for-
profits (40%) and privately owned for-profits (43%) to report that creating an organizational culture where trust, open
communication and fairness are emphasized and demonstrated by leaders is the tactic most effective in meeting the
challenges facing HR over the next 10 years.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 7

8. Demographics: Organization Industry
Industry
Manufacturing—other 16%
Health care, social assistance (e.g., hospitals, clinics, doctor's offices, in-home care,
11%
nursing homes, EAP providers, hospice)
Financial services (e.g., banking) 9%
Services—professional, scientific, technical, legal, engineering 8%
Retail/wholesale trade 6%
Consulting 6%
Educational services/education (e.g., universities, schools) 4%
Government/public administration—federal, state/local, tribal 4%
Insurance 4%
Note: n = 431.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 8

9. Demographics: Organization Industry (continued)
Industry
Other services (e.g., other nonprofit, church/religious organizations) 4%
High-tech 3%
Transportation, warehousing (e.g., distribution) 3%
Manufacturing—auto/auto-related 2%
Telecommunications 2%
Construction, mining, oil and gas 2%
Publishing, broadcasting, other media 2%
Pharmaceutical 2%
Real estate, rental, leasing 1%
Services—accommodation, food and drinking places 1%
Utilities 1%
Arts, entertainment, recreation 1%
Biotech 1%
Association—professional/trade 1%
Other 6%
Note: n = 431.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 9

10. Demographics: Organization Sector
Privately owned for-profit organization 48%
Publicly owned for-profit organization 26%
Nonprofit organization 17%
Government sector 6%
Other 3%
0% 10% 20% 30% 40% 50% 60%
Note: n = 429
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 10

11. Demographics: Organization Staff Size
50%
40%
30%
30% 28%
21%
20%
12%
10%
10%
0%
50 to 99 employees 100 to 499 employees 500 to 2499 2500 to 24999 25000 or more
employees employees employees
Note: n = 273. Percentages do not total 100% due to rounding.
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 11

12. Demographics: Other
Does the organization have U.S.-based Is the organization a single-unit company or a
operations (business units) only or multi-unit company?
does it operate multinationally?
Single-unit company: 28%
U.S.-based operations 72% Companies in which the
location and the company
Multinational operations 28% are one and the same.
Multi-unit company: 72%
Companies that have more
Note: n = 419
than one location.
Note: n = 438
• 13% of organizations indicated that Are HR policies and practices determined by
employees at their work location were the multi-unit corporate headquarters, by each
unionized. work location or both?
Note: n = 425 Multi-unit headquarters determines 44%
HR policies and practices
Each work location determines HR 3%
policies and practices
A combination of both the work 53%
location and the multi-unit
headquarters determine HR
policies and practices
Note: n = 322
Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 12

13. SHRM Poll: Challenges Facing Organizations and HR in the Next 10 Years
Methodology
• Response rate = 17%
• Sample comprised of 449 randomly selected HR
professionals with the job title of manager and above.
• Margin of error is +/- 5%
• Survey fielded August 10 – August 23, 2010
For more poll findings, visit:
www.shrm.org/surveys
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Challenges Facing Organizations and HR in the Next 10 Years | ©SHRM 2010 13