Eric Magnussen | , , ,| By
Every New Year many of us rush to create resolutions to self-improve by either adding new – or taking away old – ways of doing, seeing, or thinking about things in our daily lives. In that spirit, I propose a resolution about the needs we meet and the value we provide as HR professionals and leaders.
Not So Tiny Problems for Small Business
Tasks that we often view as “simple” or “basic” in the HR field can be challenging and time-intensive for professionals without an HR-specific skillset (or small companies without official HR departments). Imagine any one of the following HR scenarios:
- A restaurant owner has to hire a new employee, but the list of qualified candidates couldn’t be shorter.
- A small office tries to organize a benefits package for employees, but the compensation can’t match the market and a talented employee leaves.
- A simple FMLA scenario turns into a potential lawsuit for a credit union.
While it is easy to see the example scenarios as one-off situations, even isolated problems like these at the small business level could potentially be catastrophic. A poor quarter could be the difference between growth, stagnation, and (perhaps) the longevity of an emerging company.
As we await the most recent economic census data from 2014 to be released later this year, the records from the last large holistic census are instructive. Many small businesses are still single/self-employed owners with no direct employees, but approximately 40% of all US businesses have less than 500 employees and 24% employ between 5-19 people. This latter group is especially vulnerable to HR-related concerns as the expense of HR personnel can be seen as overhead that is too costly to bring on.
So what is a small business owner (truly an HR manager in their own right) to do?
- When hiring, consider those with prior HR experience to help round out your team’s skills and to ensure that a trained eye is in the room to avoid pitfalls.
- Take the time to consider outsourcing certain HR functions (payroll, compensation packages, talent acquisition) to professional service companies, while versing your team in things that are essential daily HR functions that crossover into good management skills, such as problem resolution, talent development, onboarding, and basic regulatory concerns. This scenario can work well when the complexities of an organization are small enough for an outside company to easily implement off-the-shelf solutions.
- Keep as well versed on HR topics (through blogs such as this one) as you are with other necessary functions of business ownership.
Never Too Big To Grow
Larger “small” businesses and corporations are not immune to these same issues. Without the right members of your HR team, small mistakes within an organization can have magnified consequences in both monetary and legal terms. While a company works to maximize profit, we as HR leaders not only have a duty to our employees, but also to ourselves to make sure that we provide value in all we do:
- Ensuring that we are well versed on FMLA updates, state-specific employment laws, and OSHA safety regulations are the cost of doing business.
- Understanding benefits options to prepare the best value-for-talent retention and maintain our competitiveness.
- Developing strong onboarding and career paths that will build long-term employee loyalty.
If an area of the HR practice is underrepresented it can be necessary to make the tactical choice of hiring the knowledge that is required. This is not always a simple or quick option, but the alternative scenarios can make the investment of time and money seem like a bargain.
Measuring return on investment (ROI) for HR is essential to demonstrating this value, but it isn’t always easy. With our impact on hiring, talent development, and organizational structure, highlighting the overarching value of an HR department can be difficult especially as the size of a business increases. I highly recommend starting small and adding the return of success against the cost of failure in real monetary terms. In a future post I will share some examples of how you can set measurable goals using industry standards to ensure that you are performing at your best. For now, if you aren’t sure where to start, stay focused on the basics: employee satisfaction, employee retention, and talent acquisition.
As HR Leaders, we must work to ensure that these problems do not occur within our own teams and organizations no matter their respective size. A seamless and supportive HR department will provide the knowledge base necessary for success.
To this end, we must resolve to:
- Learn as much as we can about our field and never stop asking questions.
- Make smart decisions that add daily value to our companies.
- Know when an area of HR is not one of our expertise so that the right person (internal or external) is brought in to help.
- Share what we know and celebrate our successes.
The value of what we provide can often feel hidden as a great HR department will run smoothly and few problems should occur, but we should never become complacent. By resolving to do what is best for our companies and our employees we will contribute to what I know will be a successful 2015.