Founder and director of management development consultancy 10Eighty Liz Sebag-Montefiore says it’s never too soon to address your people strategy 

Recruitment and retention

Recruitment and retention are issues for most organisations, many small businesses simply can’t attract the skilled workers they need.

Without budgetary resources for in-house HR expertise, it can be really difficult to attract, retain and train employees.

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A limited talent pool may be exacerbated when a small company can’t match the salaries offered by larger businesses.

Then, when good employees are found after the formalities of onboarding, there can be problems with the training, development and career path planning that facilitate retention.

HR difficulties are much the same as in larger organisations, with performance management and compliance at the forefront.

That said, smaller organisations are often more informal, flexible and creative in terms of their approach to culture, inclusion and engagement issues.

Where the boss is working alongside the workers then team building should be easier too.

Contracts, compliance and continuity

Compliance and contractual issues aren’t things to leave to chance and using an outsourced HR service is worth considering once you have more than a few employees.

If you want to grow the business then you’ll need HR processes and strategies to cover KPIs, performance review, reward strategy, benefits, career plans and development so you can retain and develop your employees to grow with the business.

If you don’t get these issues right, then it will exacerbate problems with recruitment and particularly retention.

Losing experienced employees in a difficult environment is a serious disruptor; it’s not just the effort of costly repeat recruitment and onboarding, but there is a negative effect on employee engagement and morale.

Resources and resilience

Training and development are crucial in a sector faced with skills shortages.

Poor performance management processes mean employees don’t know what is expected of them or what their career path with the enterprise looks like and that adversely affects retention and engagement.

To retain employees you need to build a culture that values inclusion, diversity and fairness.

Communicate, take note of employee concerns, respect wellbeing and work/life balance; treating employees well pays off.

Workers want managers who give them a voice, who show them the bigger picture, who are open and transparent, and who explain decision-making to them.

Read more on how to improve relationships with their employees.