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| Society for
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Society for Human Resource Management
1800 Duke Street [www.shrm.org/students]
Plexus Consulting Group, LLC |
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Vital Stats: The Society for Human Resource Management's (SHRM) membership is comprised of 490+ US chapters; 165,000 + members (professionals). SHRM is the largest nonprofit organization of its kind in the world and the global voice of the Human Resource profession. Two thousand of its 145,000 members are from outside the United States. These members joined SHRM despite there not being any direct marketing or recruiting effort outside the US. The largest number of non-American members comes from Canada, Mexico, the United Kingdom and the rest of Europe. In all, SHRM's international membership covers 105 countries. The Challenge | The Solution | The Process | Unintended Consequences | Measurements & Results | Lessons Learned
How to develop services and benefits that attract and retain members? How to bolster non-dues revenues? During the 1980s, SHRM was a modestly growing organization. Originally headquartered in Ohio with a government relations presence in Washington, the organization relocated with seven full-time employees to Alexandria, Virginia in January 1984. At that time, SHRM had approximately 39,000 members and was just beginning to grow its programs and staff. Until 1986, volunteers managed SHRM's annual conference and SHRM was viewed as a small organization for entry-level human resource professionals. Moreover, the Board of Directors was focused on a dues-based revenue
growth strategy. The Board's philosophy was to raise dues incrementally
on the theory that the higher the dues, the greater the perceived
value of a SHRM membership. Prior to 1990, the annual membership fee
was steadily increased every other year. In 1900, membership dues
increased from $75 to $160. The members became concerned and SHRM
began to lose members and revenue. By implementing a "business mindset" throughout every level of the organization, SHRM catapulted to $70 million in (projected 2000) annual revenues - - representing a five-fold increase from $13.4 million in 1990. "It's all about members." Developing quality member services and benefits and attracting and retaining members goes hand in hand. Drawing on years of corporate experience honed at Unisys, President and CEO Mike Losey saw an opportunity at the beginning of his tenure at SHRM in 1990 to implement a greater "business mindset" throughout the organization. This shift in organizational strategy and culture, which involved capping dues at $160 and focusing on building non-dues revenue streams, led to an unprecedented era of creative programming, membership and revenue growth with no end in sight. SHRM's remarkable growth was driven in the backdrop of a labor shortage,
a "stretched" human resource profession facing a "new
economy" paradigm shift and rapid-fire congressional action on
employment issues ranging from civil rights to disabilities to family
and medical leave. Moreover, the Internet has had an enormous impact
on how services are delivered to a rapidly changing profession. Key elements contributing to SHRM's sustained growth include:
Key programs that generated significant, diversified streams of non-dues revenue for SHRM include:
Another key element of success involved structuring alliances in several core areas. Realizing that SHRM "can't do everything," there was a conscious effort to seek out high-performance affiliates to leverage the organization's efforts. Before long, such organizations were actively working with SHRM. A particularly successful partnership was structured with Marketing General Corporation, which helped to spur the expansion of SHRM's membership from about 44,299 in 1990 to 122,848 in 1998, and a projected 152,000 in 2000. The "right leadership, tools, program of work and visibility are all aligned." Membership recruitment programs include a chapter incentive
program, web promotions and "member get a member" promotions.
All SHRM programs, such as publications and conferences, are leveraged
to recruit members and the internet has made a "huge difference"
in leveraging the success of these efforts.
The goal of the incentive plan was to convey the benefits of success to exempt and non-exempt (eligible for overtime) employees alike. This objective-based bonus system introduced an unprecedented level of staff accountability and was so enthusiastically received that bonus targets have been consistently exceeded every year since the plan was established. The 1990's leadership change did not involve an immediate
downsizing or reshuffling of the management team and staff. Rather,
a year was taken to carefully assess the operation and allow existing
staff to acclimate to a new, heightened pace of activity. An inaugural
"business review meeting", a three and a-half day exercise,
gave senior staff the opportunity to present financials and engage
in creative brainstorming to develop new programs and initiatives.
The "business review" process was subsequently incorporated
into the routine planning process.
Success was far from effortless and involved overcoming significant hurdles. One major challenge involved employee education, another involved proverbial time and resource issues. The knowledge of the average SHRM employee regarding financial statements and revenue/expense concepts was limited. As a result, staff became somewhat defensive with regard to embracing a new and intimidating financial mindset. It took time before everyone was comfortable with the approach and able to use new tools to forecast effectively. Mentoring programs helped to cushion the impact of a more intense culture. There was concern, even at management levels, that the pace was too fast, and some employees left as a result. The culture change could be likened to jogging on a treadmill
at steadily increasing speeds. Was SHRM too aggressive? Some Board
members felt that financials were stressed excessively. However, this
focus allowed SHRM to invest in new programs and take unprecedented
risks that ultimately proved worthwhile. The entrepreneurial mindset enabled SHRM to tap creative energies that a stagnant planning process would never have accommodated. For example, management found during one strategic planning session that 50% of the organization's accomplishments went successfully beyond the original budget. As a testament to this strong performance, the 230-person organization, which moved into a new, 80,000 square-foot building in July 1997, is working on completing its second 80,000 square-foot building. Other key indicators of SHRM's success are:
SHRM's top strategic priority focused on membership growth, not as
an end in itself but as a tool to achieve the vision of serving as
the premier voice of the human resource profession worldwide. In order
to manage growth, it had to be measured, and monthly budgetary discipline
was integrated across all levels of the organization to ensure consistency
of focus to meet this priority goal. "We do surveys. We ask, listen and respond." SHRM tracks and measures its programs using:
Initially, it was a challenge to develop spreadsheets to adequately measure the success of new program initiatives. Prior to 1990, budget and program disciplines were relegated to member "care and feeding." The focus had been to "keep the train running" and not to determine whether it was running in the right direction. SHRM management introduced metrics and financial analyses to measure the organization's efficiency. The new, results-oriented culture of financial discipline, as difficult as it was to implement at first, made all the difference. Surveys have shown that members are pleased with the quality of SHRM's
services and that the value of the $160 membership well exceeds the
cost. Surveys show SHRM's recruitment and retention programs are working.
More members join by "word of mouth" than by any other means.
"People hear about us because members are happy."
Financial discipline and success are inseparable. SHRM learned that the key to success involves:
Members The Board Other key lessons from SHRM's experience are:
However, SHRM's management always recognized the need to "find a balance", the need to be flexible and to respond quickly. The numbers in a budget are viewed as plans and not a "chain around the ankle." An organization cannot afford to overlook opportunities. At $70 million and growing, SHRM continues to be challenged by growth and "good problems" such as restructuring the call center and check processing systems to accommodate an ever-increasing membership. SHRM management faces a continual challenge to deliver the professional development experience on which members have come to rely. Essentially, the "bottom line" is that success creates new challenges, good challenges. It involves multiple moving targets - - you are never "there" - there is no plateau, no opportunity to "kick back and enjoy success." As a result, there is no such thing as "best practices", only "competitive practices".
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