Do small & entrepreneurial firms need human resource management?
Happy day, amazing people!!!
Managing human resource for small and entrepreneurial firms are quite different from large and corporate firms. This is because they don’t have a set ecosystem for it.
Now let’s see what are the reasons which stops small firms from having proper human resource management.
Size: Sometimes firms might feel that unless and until achieving a certain no. of employee milestone they might not have a dedicated person for managing human resource of the firm.
Priorities: Due to shortage of resources, firms don’t priorities their time and energy for HR related activities.
Informality: Generally small firms’ practices are informal in nature. This is not due to lack of expertise or resources but for its survival. They must be flexible in things like training and compensation policies to adopt to competitive environment.
The Entrepreneur: Owners’ personalities plays a vital role in managing the affairs of the firm.
Why small firms need proper human resources management?
Competitive disadvantage: If they don’t stay on trend, they will be pushed to competitive disadvantage position. So, firms must change their basic HR practices. For e.g.: Using web-based recruiting tools for recruitment.
Legal implications: Since the businesses have a lot of things to do in a short amount of time, they might miss out on few legal aspects of HR like asking questions to a candidate which are not supposed to be asked in the interview. For e.g.: Asking a female candidate if she’s thinking of starting a family.
Lack of specialized HR expertise: When they don’t have specialized HR people, they may fail to address some specific areas like equal employment law, occupational safety and so on. Which may eventually lead to some legal or other problems.
Complying with law: Business owners may not be fully complied with laws. Hence, they need proper HRM to comply with compensation regulations and laws. For e.g.: paying compensatory time for overtime hours worked.
Data entry errors: Employee data often appears on multiple human resource forms. And since small businesses doesn’t use HRIS, if any changes required, it can only be done manually. This may trigger errors and consumes time.
Productivity: Research shows that firms with proper HR practices did much better than those that didn’t. Hence firms must put in more emphasis on training & development, performance appraisal, recruitment packages, maintaining morale and setting competitive compensation levels.
How can small firms achieve effective HR management?
By using internet-based resources
- Government owned websites for legal doubts
- Using job description and job specification tools for writing
- Posting vacancies on job board/sites
- Conducting online based personality and aptitude test
- Training through online courses
- Computerized appraisal system
We hope you guys have understood about human resource management for small & entrepreneurial firms.
Ok then, before signing off
Love what you do, do what you love…. Bye
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Simply grasp