HR for SMEs. Managing people related business issues
No theory here, just practical actions for hard working busy managers. As a small to medium sized business owner, you have to be across everything and the day to day demands of earning a living and paying your staff means you keep your eyes on cashflow, compliance and where the next sale or cost is coming from. You do not have the luxury of an HR Manager, so you must rely on your own judgement and do the best you can. If you have had the privilege of a good grounding in managing people through prior experience then you are a step ahead, but for most SME managers, they learn by doing and from whatever self-directed study they can manage. So,here is the skinny; the key HR practices for a sustainable business.
Hiring. Get this wrong and it will wreck your business. Make and take the time before you hire to be clear about what you want and focus on the things that are hard to train. In the interview, ask for specific examples of past achievements that relate to the job you want them to do. Do not accept theoretical answers about ‘how’ they would perform a task, insist on specific examples of how they ‘have’ done it before. Keep asking until they give you examples. If they cannot give you examples then they are not the right people for your business. Ask every applicant the same questions, make notes and rank them so you can compare them. Select the two best candidates and then decide which candidate fits best with you and the team. SMEs live and die based on relationships.
Performance and feedback.Getting this right is essential for staff engagement and productivity. Most performance management is over engineered. Forget about appraisal forms and systems. Focus on the three questions we know that people bring to work; What is the big picture? How do I contribute?and How will I know how I am doing? If you have sensible answers to these three questions, a lot of potential problems come off the table. So, in practical terms, make time every day to talk to your team individually and collectively. Look for ways to ‘raise the bar’ and talk about it. Ensure everyone has a direct line of sight between the tasks they are doing and why their job exists in the first place. No paper work, KPIs, objectives, performance appraisals – it’s just too much talk than making things happen, instead catch people doing the right thing and recognize them when they get it right.
Develop people. This is top of the list for retaining staff and growing your business and it’s not about sending people on courses. When you ask successful people about what has made the most difference to them, it is the managers they have had and the growth they have had from stretching experiences and early autonomy. Delegate and set demanding expectations, coach your team.
Health and safety. This is a no brainer. You need to comply with the law and people need to feel you personally care about their safety. Invest in the right PPE where required and make a healthy and safe workplace a regular agenda item at meetings and talks
Pay. This is key to retention and reducing the cost of turnover; which is typically three times the cost of recruitment. Money may not be a motivator, but a sense in inequity is a big de-motivator. Know the market rate for your jobs and pay it. If you can afford it pay marginally above it.