HR Tips for Small Business - Recruiting and retaining good staff

In large organisations, there is quite often a Human Resources department that exists to oversee staffing related matters - including the recruitment, training and development of employees. The people working in these departments are typically HR “specialists”.

In small business however, the HR function is just one of the hats that the owner will be required to wear. As soon as you start to grow your small business and employ staff on either a contract, part time or full time basis, then there is a range of “HR stuff” which a business owner must research and carefully consider.

The question of wages and other HR issues

For example, one of the very first questions you must ponder is what will you pay your staff? Are there relevant awards for the particular job you have available? Certainly for many service and hospitality related jobs, such as chef or waitress or store assistant or hairdresser, there are defined award rates.

But not every job is covered by an award in Australia – and there will be occasions when in order to get the best people you need to meet the wages that are offered in the wider market.  So, you must consider whether you will simply pay them the award rate, which defines the legal minimum hourly rate and other employee entitlements, such as annual leave for example? …. Or, do you need to offer higher-than-award wage rates in order to attract quality people? ….. Will you offer a bonus if the employee performs extraordinarily well and contributes to further growth in the business? …… What specific duties should be included in the job description of the employee? …… What performance standards will you expect and how will you measure the performance of your staff to ensure that they are adding sufficient value to your business?

If you run a small business and are either thinking about employing staff or perhaps you already have staff working for you, but you’re not too sure about some of this HR stuff, then read on ………. I had an interesting chat with Tracy Busse, who runs Waveform Consulting based in Melbourne. Here’s what she had to say about HR as it applies to small business, and some great tips she offered for recruiting and retaining good quality staff…..

Tracy, what experience do you have with HR?

I have many years of operational experience in hospitality and 20+ years’ experience in Human Resources in South Africa, Australia and the UK. My experience across most HR functions includes the hotel industry, not for profit/community development and water/government business enterprise. I have also run two small businesses, a restaurant and currently a HR and transitions coaching consultancy. I have studied HR/organisational psychology in both South Africa and Australia up to Masters Level.

What is your key HR message for small business owners?

Having experienced most HR functions and a range of HR initiatives in my working life, it is easy for a small business owner to get confused by the seemingly complex array of HR regulations, systems and programs. However I think it can be simplified into one key message - to value the people who are working for you and to treat them as whole people not “just a staff member”.

I recently had a conversation with a business coach. His future vision is to create workplaces where his children will be well treated and flourish as human beings. A key message here is to treat people as you would wish you children to be treated in their workplace one day. Values such as respect, fairness and dignity come to mind. And of course this also includes making hard decisions and managing performance. It doesn’t mean a happy family at the expense of the business.

HR is often viewed as the “soft” side of the business, compared to the “hard” side of the business being focused on the numbers and the Profit/Loss figures on the ledger sheet. And yet I think that a healthy business needs a balance between these hard and soft elements, if it is going to be sustainable over the long term.

I believe that this “human care factor” should apply to direct staff members as well as any contractors or consultants that might be engaged by your small business. Whether your employees feel that you are treating them with care and respect will ultimately influence the quality of service they in turn deliver to your customers.

You won’t win loyalty, pride and dedication from your employees unless they feel that you are looking after them.

What can small business do to attract and recruit great staff?

I suggest you cast your net wide when a staff vacancy arises in your small business.

·        Use social media (Facebook, LinkedIn, twitter, Google+ are all great, cost effective options)

·        Don’t underestimate the power of word of mouth – ask all friends and family

·        Use your business networks

·        Be prepared to invest your time in finding the right person. Remember it is much more costly to end up with someone who is a poor fit.

·        if you opt to use an employment agency, then invest the time in ensuring that they are high quality and that they understand your business and culture

Additionally, I have found there are many untapped talent pools out there that a small business owner can leverage.

I run outplacement programs and often spend time with quite skilled people who have been retrenched from large organisations that have “down-sized”. Others are disillusioned with corporate life or want more work/life balance and some keep getting turned down because they have too much or too little experience.

The members of these talent pools are quite often looking for career changes, new opportunities and workplaces that fit with their values. I see small business as a very viable opportunity for this talent pool – either as entrepreneurs, staff members or contractors.
(for interviewing tips, have a look at How To Conduct the Job Interview - Brian)

What can a small business owner do to retain quality staff?

This is a good question. If small business owners are going to invest their time in finding really great people, then they have to be prepared to do what it takes to keep them and be great at it. I have many ideas about how to do this - some include ….

·        Value people – an imperative and the message must be consistently conveyed in everything you think, do and say. You can rant and rave in the heat of the moment at a computer or machine that may have let you down – but an employee will never forgive you if were to treat them in such a way

·        Induct and train people properly when they start in your business…..  Ensure that you provide new staff with a full understanding of your mission, vision, values, culture, what you expect of them etc. – Explain this bigger picture and then the rest will fall into place more easily e.g. systems, procedures, information etc.

·        Develop people – how will you grow and develop your new staff member? Consider both job capabilities, future capabilities and personal development

·        Have regular communication and keep your staff informed about what’s going on in the business – particularly during times of change

·        Offer a range of employee benefits beyond just the traditional e.g. health and well-being initiatives, work/life balance, a range of flexible working options e.g. part-time, contract work, telecommuting, virtual assistance etc.

There are essentially four questions that people want answered when they are working for you:

i)            Where are we going as a business or team?

ii)           What is my role and what do you expect of me?

iii)          How am I going – are you satisfied with my work?

iv)         Where will I be in the business / team as we move forward in the future?

Provided that you answer these basic concerns of your staff, then you will be well on track towards retaining them.  Of course, whether the work itself matches their skills and interests will also influence their motivation – as well as the quality of the relationship that you build with them. Studies have shown that one of the most common reasons an employee leaves a job is because of a poor working relationship with their immediate manager.

Are there any risks associated with attraction and retention in the small business?

I’ve come across many small business owners who experience a fear of “being taken advantage of”. And yet I have found that when you give trust, more often than not you will usually receive it in return. The same principle applies to your relationship with your customers …… As I said earlier, the relationship you have with your staff will often determine the relationship you have with your customers.

The other common fear is the risk of losing good staff, particularly after having invested time in their training.

But small business owners needs to consider the advantages they can offer to an employee – a far broader range of experience across many functions, more flexibility, staff often get more opportunities and they can develop their own systems and procedures rather than be subject to the constraints of corporate life. Consider your competitive advantage and market it!

So in conclusion Tracy says "Your business is only as good as the people within it and happy staff will equal happy customers!"

Related articles - How to Hire Good Customer Service Staff in Your Small Business  and also How to Motivate Employees

 About the author

Brian Carroll is the founder of a corporate training and leadership development company, Performance Development, based in Melbourne, Australia.  He is a qualified psychologist, experienced management coach and an engaging presenter, with a passion for helping people achieve their full potential