HOW CAN I AS A SMALL BUSINESS GROW MY FIRM UTILIZING HRM?

Human resource management practices and procedures have been researched in small and medium sized enterprises (SMEs). Some common human resource management (HRM) functions that reflect operational and pragmatic needs: record keeping, staffing activities (i.e., recruiting and selecting staff), motivation and retention activities (i.e. compensation and reward practices). Although HRM practices are characterized as informal in small and medium sized enterprises (SMEs), research reveals there are more sophisticated HRM systems in small and medium sized enterprises than expected (Barrett and Mayson, 2007). Strategic HRM allows with an internal capacity to adapt and adjust to their competitive environments by aligning HRM policies and practices (i.e., recruitment and selection and training and development) with business strategies (Barrett and Mayson, 2007).

The resource based view of the firm suggests HRM can be a source of competitive advantage. Writers argue a firm’s ability to develop unique and distinct bundles of inter-linked HRM practices aligned with business strategy are a source of sustainable competitive advantage (Barrett and Mayson, 2007). A strategic approach to managing employees is essential to the growth and development of all organizations, including small ones. This strategic approach is especially important in small growing organizations in wake of the growing complexity associated with a growing workforce. Small firms are known to utilize informal HRM practices for recruitment by word-of-mouth and newspaper ads. However as the workforce of the firm increases, a firm can exhaust its leads making it difficult to locate employees that are reputable and depending and fit within the firm’s culture.

Retention is an area of concern for small firms. HRM tools such as Compensation Salary Surveys are critical when determining competitive salaries http://www.payscale.com.

Performance appraisals are another inexpensive tool that is very important in the growth and development of your firm’s workforce performance appraisal form (pdf) sample/template. Performances appraisals are for the growth and development of your workforce, as opposed to utilizing for monitoring purposes. Aligning your firm’s HRM practices with your business strategy is essential to organizational growth.

We will discuss how to assess your firm’s HRM position as well as align your HRM practices with your business strategy. Until Wednesday, be STRATEGIC in all you do!!!!!!

April,

Information assisting in this Blog was retrieved from:
Barrett, R., & Mayson, S. (2007). Human resource management in growing small firms. Journal of Small Business and Enterprise Development, 14(2), 307-307-320. doi:10.1108/14626000710746727