Importance of HR in Small Business

HR in Small Business

Human resource is a very important component in the functioning of any organisation. Good and efficient employees can take any business to dizzying heights and deliver results optimally. In large companies and organisations, one or two employees that do not deliver may go unnoticed. But not so in small businesses where an under producing staff can adversely affect the overall functioning. It is therefore crucial that the right employee for a vacancy is selected after careful thought and due diligence. The facilitator in this case is of course the HR manager who has the onerous task of making sure that the recruited employee is committed, loyal and well suited for the job.

However, the role of an HR executive in small businesses goes much beyond the recruitment process. Here are some of the more important aspects –

  • Compliance with rules and regulations – One of the primary responsibilities of an HR manager is ensuring that all statutory rules and regulations relevant to employee relationships are complied with – from hiring to safety issues to compliance with labour laws. As per rules, even small businesses with even 10 employees have to follow certain regulations in this regard.
  • Optimised hiring practices – A good employee is one that has the required skills and knowledge to blend in perfectly with the work requirements and culture of the organisation. An HR manager thus has to ensure the smooth working of the business and make sure that matching staff is in place. It requires intense planning and a good HR policy. This is because the recruitment process is not easy. Advertisements have to be given in the print media, preliminary screening of applicants has to be made and the final round of interviews has to be conducted. The problem arises when vacancies have to be filled at short notice. With foresight, an HR manager can ensure that the small business runs smoothly without any hitch.
  • Training and development – This is one aspect that is critical for any organisation. It is more so for small businesses with limited employees at their disposal. Every employee has to be trained to handle a wide range of activities, often outside their area of expertise. Only specific cross training can make sure that employees are able to cover more than one job function. The focus of an HR manager should also be to have policies in place that are also effective.

This training can take various forms. The most common is having senior executives conduct programs related to their specialisations. The other is having training programs devised by external agencies. Here the name of Shannon Pigram comes to mind. He is a multi-talented HR executive who specialises in employee engagement, training programs and talent management. It is people like him who can be of immense help in creating effective training courses.

  • Employee Recognition – Employee recognition is a huge motivating factor but sadly, small businesses do not have the required budget to do full justice to it. It is here that the position of an HR manager becomes very important. It is he/she who has to keep a tab on employee performance and work out a system of rewards. Employees’ preferences have to be evaluated and programs and activities created that will meet those needs. Only then can such problems as absenteeism and low productivity be addressed, both factors that contribute to high staffing costs. Another employee recognition strategy is to highlight performance on social media platforms such as Instagram or Pinterest and on the business website.
  • Welfare measures – A few welfare measures are statutory, others are at the sole discretion of the management. It is in the second instance that a HR executive has a crucial part to play. An exact balance has to be struck and welfare measures initiated that will not only meet employee expectations but will also be within the limited budget of a small business.

These are some of the roles and functions of an HR manager of a small business.

Essential Guide to Manage Small Business

Small business

A start up or small business has its own exclusivity. What is good for a well established running concern might not be the same for small businesses. This is because any venture in the preliminary stages has to be nurtured carefully so that it can become a profit generating entity in the shortest possible time. If you have a small business that is poised for the big leap towards stability and expansion, here are a few essential tips that you should follow.

  • Hire a business consultant – You might have a great idea to start off but that does not make you a master of implementation who can turn that idea into a reality. You have to depend on experts in various fields but hiring executives can be a very costly proposition especially in the initial stages of your small business when revenue inflows are low. The best option for you then is to hire a business consultant. Such a person brings a whole world of industry level experience to the table, most importantly at very affordable costs.

By hiring a consultant, in one stroke you will get professional guidance on every aspect of your business. He/she will work out financial and marketing strategies that will be the blueprint for your small business in the near future. A consultant can be hired from one of the many specialised consultancy firms or a recruitment agency in Melbourne or wherever your business is located.

  • Have a business plan – This is a complex procedure and covers various aspects of business. The consultant you hire will help you draw up a business plan. It will include marketing strategies that you should adopt to get ahead of your competitors and a financial plan that will have your projected working capital requirements, cash flows, expenditure and revenue generation. Based on this plan you can devise methods for quick business growth and development. Business plans are so comprehensive that you can even present them to financial institutions for availing credit facilities or to bring a partner or investor on board.

  • Choose and hire wisely – Small businesses have to exercise financial restraint if they have to prosper. You might have an inclination to hire a whole lot of experts to guide you. However, apart from paying high salaries that you can ill-afford as a small business, the fact remains that you really do not need all of them. Take the case of staff and payroll management. Instead of taking on HR professionals, you may as well outsource the activity to established HR management agencies that will take care of all your staff functions. You are spared from investing heavily in hardware and software and hiring trained people. You will do well to recruit only limited key personnel in advisory roles who will have the expertise and experience to get your small business moving.

It is also advisable to recruit your employees from well known labour hire agencies. First Personnel is one of the industry leaders. Get in touch with them and you can be sure that you will be referred staff that will optimally match your requirements.

  • Maximise local publicity – Have a website designed and developed for your business that will be optimised for local searches. You need not be bothered if people from all corners of the globe do not find your business over the Internet. Be concerned with the local population in your area of operations and have your visibility and online presence enhanced for this segment only. A well established digital marketing agency will be able to guide you in this regard.

These are just a few pointers and tips on how you can maximise management of your small business.