Has your organization achieved cost savings, incurred cost increases, or did costs remain about the same

as a direct result of outsourcing its HR functions?

60% 50% 40% 30% 20% 10% 0% Achieved cost savings Incurred cost increases
2004 (n = 104) 2008 (n = 270)

49%

49% 37% 28% 23% 14%

Costs remained about the same

Note: HR professionals that reported their organization did not outsource any of its HR functions or dont know where exclud ed from this analysis. 2004 results were recalculated to exclude respondents who selected the do not know response option.

SHRM Poll August 18, 2008

SHRM 2008

Overall, how satisfied or dissatisfied is your organization with the services provided by your outsourcing vendor (s)?

60% 50% 40% 30% 20% 12% 10% 0% 0% Very dissatisfied Somewhat dissatisfied
2004 (n = 173)

57% 53%

38% 32%

3%

5%

Somewhat satisfied
2008 (n = 211)

Very satisfied

Note: 2004 results were recalculated to exclude respondents who selected the Neither satisfied nor dissatisfied response o ption.

SHRM Poll August 18, 2008

SHRM 2008

Overall, how satisfied or dissatisfied is your organization with the relationship with your outsourcing vendor (s)?

70% 60% 50% 40% 30% 20% 10% 0% 0% Very dissatisfied Somewhat dissatisfied
2004 (n = 159)

59% 55%

39% 35%

7% 3% 2% Somewhat satisfied
2008 (n = 204)

Very satisfied

Note: 2004 results were recalculated to exclude respondents who selected the Neither satisfied nor dissatisfied response o ption.

SHRM Poll August 18, 2008

SHRM 2008

Overall, to what extent has outsourcing HR functions met the expectations of your organization?

60% 50% 50% 40% 30% 20% 10% 1% 0% To no extent at all To a small extent
2004 (n = 167)

47%

44% 34%

15% 4% 5%

To some extent
2008 (n = 238)

To a large extent

Note: 2004 results were recalculated to exclude respondents who selected the Neither to a large extent nor to a small extent response option.

SHRM Poll August 18, 2008

SHRM 2008

Do you expect that your organizations outsourcing of HR functions will increase, stay the same, or decrease in the next five years?

70% 60%

64% 50%

50% 40% 30% 20% 10% 0% Increase Stay the same

2004 (n = 164) 2008 (n = 227)

32% 33%

17% 4%

Decrease

SHRM Poll August 18, 2008

SHRM 2008

Projected Top 10 HR areas that will be outsourced according to organizations that expect their outsourcing to increase in the next five years

n = 77 Background/criminal background checks Employee assistance/counseling Flexible spending account administration Health care benefits administration Temporary staffing Payroll administration Consolidated Omnibus Budget Reconciliation Act (COBRA) Recruitment/staffing of employees (non-executives) Training and development programs Retirement benefits administration

Percentage
65% 52% 52% 46% 39% 34% 32% 27% 27% 25%

Note: Percentages do not total 100% as multiple response options were allowed.

SHRM Poll August 18, 2008

SHRM 2008

Why has your organization chosen NOT to outsource its HR functions?

n = 417 We wanted to maintain face-to-face contact with our employees We preferred to develop expertise in-house We do not want to lose control of our HR functions We felt it would negatively impact customer service to our employees We felt it would negatively impact the company culture We preferred to invest in technology in-house We felt that it would be too expensive We felt we would be unable to achieve a cost savings We do not have the resources to manage the outsourcing process We encountered resistance within senior management There is no need We encountered resistance within HR We have had a bad experience with outsourcing in the past We encountered resistance from employees in general

2004 61% 46% 50% 45% 37% 20% 30% 23% 18% 8% 6% 7% 3.0% 4%

2008 54% 43% 42% 28% 28% 20% 18% 16% 14% 8% 7% 5% 3% 1%

Note: Percentages do not total 100% as multiple response options were allowed. Based on HR professionals from organization that do not currently outsource any HR functions. Data sorted in descending order by 2008 column.

SHRM Poll August 18, 2008

SHRM 2008

Approximately, how long has your organization being outsourcing any of its HR functions?

Average number of years that responding organizations have been outsourcing any HR functions is 6 years.

SHRM Poll August 18, 2008

SHRM 2008

Methodology

Response rate = 20% Sample comprised of 891 randomly selected HR professionals from SHRMs membership. Margin of error is +/- 5%. Survey fielded the week of August 18, 2008

SHRM Poll August 18, 2008

SHRM 2008