Top Five People Management Strategies for Small Businesses
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The heart of any business is its people. It is known, people buy from people. By ignoring the people management side of a business, it can at times lead to costly mistakes that can have serious consequences for a small business. This can either through employee turnover, employee litigation or even by clients as a star employee who left, brought them in.
As small business owners, the focus is on juggling multiple roles, from marketing, to accounting, to human resources. When the business is running smoothly, it is sometimes easy to ignore the people management aspect of the business.
It is often thought that People Management is only for big organisations, however this is not true – people management is vital for all types of businesses.
People Management can be seen as a function within a business with the objective of maximising employee performance for reaching the strategic goals of a company.
People Management for small businesses is different to that of bigger companies as the challenges faced vary. When a company is in early development, it is the best time to implement solid and effective people management strategies. This will allow small businesses to effectively manage their workforce throughout the turmoil and pressure of significant growth and prosperity.
According to research, almost 88% of the leaders of Top 50 Companies believe that by building the people management system from the beginning, proves to be rewarding in the long term as it helps in retaining the top talent which leads to better growth for the company.
In order to develop a sound People Management Strategy for a small business, it is important that the following steps are first implemented:
Employee Handbook
Businesses of all sizes, need to have some form of employee handbook which needs to be updated on a regular basis. It serves as the drawing board to building a lasting and stable workforce. It needs to clearly define the policies and procedures pf a company to ensure nothing is left open to interpretation.
Motivation
It is not difficult finding the right talent, what is difficult, is retaining them. What is the difference that makes the difference in your company that want to make employees stay? For most employees, work is home away from home as this is where they spend a big part of their working week. They want to ensure that their needs are being met, whether it is being recognised for their input, being acknowledged as a team member, their health and wellbeing is looked after, the environment they work in is appealing and various other factors.
Retain
Motivation is one aspect of retaining top talent. However, this alone will not retain employees. If you not entirely sure of what employees would want, ask them for their input and together come up with solutions that would benefit both parties. By getting their input, will buy you good-will and respect as it shows they are important to you.
Once the above steps have been implemented, research has shown the following 5 strategies can help small business owners from dropping the ball when it comes to People Management.
Improve Employee Satisfaction
Business owners must understand that employees are the heart of their business and is their greatest asset and therefore it is important to ensure that they are happy with the company and with their position. Increasing employee satisfaction leads to increased productivity, improved morale, fewer people wanting to leave, loyalty and a sense of commitment.
Design Effective Learning & Development Programmes
By providing new employees with the tools they need to hit the ground running and providing current employees with opportunities to grow, not only will it increase retention but also employees would want to perform at their peak. A thorough on boarding or orientation programme for new employees is essential as it will ensure commitment from early on.
Professional development programmes for employees need not be an expensive tool. A cost effective method could be to look at mentorship programmes or even job rotations.
Implementation of Legal Employment Practices
It is important for small business owners to ensure that their employment practices are legally sound and is deemed to be fair and in line with employment legislation. When drafting an employee handbook, it is highly recommended that small business owners consult with an HR professional to reduce the likelihood of violating an employment law and assuming unnecessary liability or risk, for e.g. do you manage your employees differently to your contractors?
Construct Fair and Equitable Compensation Strategies
One of the foundations of a successful business is its fair and equitable compensation strategies. Compensation not only dictates the fixed costs that the company incurs but also determines the satisfaction level of employees. Not only is it important to ensure that internally the salary levels are fair, but as a small business owner, it is important to understand what your competitor’s are offering to their employees for performing similar jobs.
It is important to ensure that employees are compensated fairly and equally.
Develop Reliable Performance Management Systems
Business owners are good at measuring the performance of the business. However, to ensure the success of any business, is to link employee performance to the business objectives. It not only indicates to business owners what value add their employees bring, but also ensures consistency as it is an evaluation system put into place to measure both business and employee performance. The first step would be to do a job analysis and write a job description for each position. The job description can be used to determine the performance objectives the employee has to focus on. This provides not only meaningful and reliable feedback to the employee but also links it meaningfully to the business objectives.
The question for most business owners would be, “where do I begin?” If you are already an established business, don’t try and deal with everything at once. Focus on any high risk areas and develop a realistic timeframe for these areas. If you are focusing your efforts on training, identify a couple of areas of importance and focus efforts on what you want to do by when.
If you are business in start-up mode or just busy to grow, by implementing the above strategies will place you on the road to developing your people management system.
Connect with me today and contact me for a free consultation OR visit my website www.constantiaconsulting.com to complete a free HR Audit and receive a detailed report.
