Top 5 HR Strategies for Small Businesses
There are HR strategies that are essentials for every organization; however, small businesses must focus their limited resources, money and time on the most salient that will make the biggest and longest lasting impact.
Here Are The Top Five To Consider:
1. Ensure HR Compliance
While this may sound like a common sense practice, many small business owners overlook the necessity to accurately understand the laws that apply to their business operations, undervalue the nuances of HR compliance or just don’t have the time and/or expertise to get it done right the first time. Items such as an accurate and full employee handbook that covers company policy and procedures, federal and state laws and gives ample examples of the culture you are creating is an essential. This essential is often overlooked in favor of an easy print-off handbook from the internet that oftentimes misses the most current laws and certainly does not help to shape the culture and core values you wish for your employees to exemplify. An employee handbook is just one example of many that aid in ensuring compliant behaviors that protect your company from adverse action; keep employees aware, productive and happy; and potentially affect your bottom line. There are a plethora of other compliance and HR policy development areas to be aware of, including the need for periodic HR audits.
2. Create Accurate Job Descriptions
Employee job descriptions are an opportunity to communicate the company direction and assist in ensuring that employees know where they fit into the big picture. Thoughtful, accurate and well-written job descriptions aim at providing employees with a line of sight between their individual role and the company’s goals. Alignment of your people with your vision, goals, mission and objectives spells success for any organization. Job planning must be done before job roles to hire for are established and before job descriptions are written. As the leader, you must assure the inter-functionality of each of the different roles needed to run your business effectively and efficiently. Job descriptions also set clear expectations for what you expect from your employees; help to cover legal bases, ensuring compliance by moving away from biased interviewing and hiring decisions; and set parameters for personal responsibility to the team as a whole.
3. Conduct Salary Benchmarking / Analyze Pay Practices
Arriving at the right remuneration package can mean the difference between attracting and retaining or not hiring or keeping key leaders and employees. Salary benchmarking gives you invaluable information so you can make well informed compensation decisions. One of the challenges of setting the remuneration package for small businesses is making sure that the compensation you are offering is in line with the rest of the market. However, finding out what others in your industry are paying their directors, managers and professionals can be a challenge in itself. Also, small businesses may not have the means to offer competitive salaries. In this case, there are pay practices that may work in your favor and allow you to still attract the best and brightest. One such option among many is variable pay.
4. Hire Right
Hiring the right people sounds like a cliché, but it is in the top five for all organizations regardless of size. What is simple is not always easy. Hiring right requires some strategy in advance of making your first or 100th job offer. It requires that you prioritize what you or your team actually need, considering complementary skills to that of your current workforce. It requires that you examine hard and soft skills requirements, your organizational core values which are a part of the culture you are creating or wish to create. All too often the importance of hiring for culture-fit is dismissed or diminished in lieu of hiring for hard skills/expertise only. This is a mistake of epic proportion and can be especially damaging for small business where the size and intimacy of the workforce is very different than in a larger work settings or work group. A balance between hard and soft skills and company culture-fit is needed to hire for success, longevity and a happy workforce.
5. Implement Performance Management Processes
The primary focus of performance management processes are to ensure the linkage between strategic business objectives and day-to-day activities. Effective goal setting in combination with tracked progress that identifies and removes obstacles contributes to the bottom line. Performance goals and objectives must be set for the organization and for the employees as teams and/or individually. Regular tracking of progress provides the opportunity to recognize and reward employees for performance and exceptional effort, contributing to job satisfaction and productivity. Employees want to feel valued as measured by their contribution. In order to ensure this happens, employees need a clear understanding of individual goals and how they fit into the larger organization. This is first established in the job descriptions and hiring practices of an organization and then expands to encompass employee training and development, employee coaching, appraisal and feedback systems.