HR Must Manage Demographics, SHRM Report Warns

By SHRM Online staff

Managing demographics will take on a higher priority for HR professionals in the years 2010 through 2015, but most organizations don’t have staff dedicated to this crucial task, according to new research.

More than twice as many HR professionals cited managing demographics as a top challenge for 2010 through 2015 than for 2007, the Society for Human Resource Management says in its executive summary, Key Priorities for the HR Profession Through 2015, released Dec. 23, 2008.

The survey found that delivering on recruiting and staffing are expected to be lower priorities in 2010 through 2015 than it was considered to be in 2007.

The findings are a result of a worldwide survey on HR priorities that asked respondents to indicate priorities for 2007 and 2010-2015. The World Federation of Personnel Management Associations (WFPMA) and The Boston Consulting Group conducted the survey in October 2007, and the Society for Human Resource Management (SHRM) partnered with the organizations in collecting data from 526 HR professionals for the U.S. portion of the online survey that reflects results from 83 countries and markets.

In the United States, 504 HR professionals cited the following as top priorities for their profession in the coming years and the top two actions HR is planning for each:

• Managing talent—73 percent plan to develop tailored career tracks; 65 percent are developing specific compensation strategies for talented workers.
• Improving leadership development—70 percent plan to use internal coaching from top management; 64 percent plan to measure leadership skills through 360-degree feedback.
• Managing demographics (future capacity loss attributable to aging workforce)—66 percent plan to conduct internal training and qualify people for other cross-job groups; 66 percent plan to offer employment options to attract or retain semi-retired or retired workers.
• Managing an aging workforce (a subset of managing demographics)—79 percent plan to invest in training to enhance skill levels; 60 percent plan to train employees to respond to generational differences.
• Delivering on recruiting and staffing—67 percent plan to identify precise recruiting needs; 67 percent plan to more closely control recruiting and staffing processes.
• Managing change and cultural transformation—83 percent plan to communicate a vision for action; 83 percent plan to close capabilities gaps with assessments, training and staffing.

Managing demographics is a new priority for 2010-2015 and was the one area where more than three-fourths of those surveyed said they didn’t have a designated person overseeing the function.

The other top priorities cited for 2010-2015 were the same cited in 2007, although in a slightly different order. However, while HR identified managing talent and improving leadership development as the top two priorities facing organizations today, more than six out of 10 said their organizations are doing just an average job in these areas.

The SHRM summary quotes Laura Lea Clinton, GPHR, director of HR management for CARE USA and a member of SHRM’s Employee Relations Special Expertise Panel.

“The focus of [managing talent] in the past has been on rehabilitating poor performers—the trend will reverse to a focus on the continued engagement and retention of the top performers,” she said.

The SHRM summary notes that “with an increasingly diverse, competitive and shrinking labor market, organizations will need to maximize and invest in the available labor pool,” make the best use of existing talent, and be creative in recruitment, retention and development tactics.

Almost two-thirds (64 percent) of HR professionals in the United States said there is a person designated to improve leadership development within their organization, and slightly more than half said HR typically serves as a partner.

Few organizations do a good job of leadership development, though, said Lewis Benavides, SPHR, associate vice president for HR at Texas Woman’s University.

Because leadership development is costly and time consuming, the SHRM Workplace Diversity Special Expertise Panel member said, “there is a tendency to just go out and find leadership that has already been developed—this is bad long-term strategy.”

He observed that because few U.S. organizations expose their executives to “global or emerging market countries” those executives “lack that international perspective in leadership development.”