To stay ahead of its competitors, it is important for the owner of a small business to hone the art of effective human resources management. Owning and running a small business is all about playing multiple roles and responsibilities right from accounting to sales and marketing to HR management. Unfortunately, the juggling increases the odds of committing some serious blunders.
Often, it is quite easy for a small business owner to overlook the human resources department when things are working according to the plan. However, this can take a nasty turn resulting in some gravest mistakes. Yes, litigations, low employee retention rate and high employee turnover can blow up a small business.
So how to keep away from these HR pitfalls? Here is a rundown on some of the most common HR mistakes that small businesses commit and ways to avert them.
1. Rushing with the recruitment process
When we talk about recruitment for a small business, mistakes are a part and parcel of the game here. Be it a poorly drafted job description or giving out offer letters hastily, it can pose a serious threat to a small business. Even a single bad hire can result in substantial loss for a start-up or SME.
Often, these mistakes are the upshots of a hasty recruitment process. A perfect solution is to create an organized interview and screening process. Ensure to draft a precise and accurate job description without much hype. Job description ought to include must-have skills, qualifications, bonus details, job roles, company details, etc. This is an excellent trick to woo stellar candidates and weed out the unwanted ones.
Another key factor that small business owners tend to overlook is interviewing candidates that fit the company’s culture. It is as important as hiring a candidate with all the required skills particularly for a small business. If possible, it is advisable to rope in more folks during the interview, since a team is always handy when it comes to making best recruitment decisions.
2. Outdated or not having employee handbook
To curb employee violations, it is necessary for small businesses to have a robust HR policies and regulations. Next, your business ought to have an employee handbook in place, since not having one is an open invitation to troubles.
Simply having a handbook in place is not enough, as the policies and regulations stated in the handbook ought to be updated regularly without fail. Also, ensure that the updated policies are communicated well all across the company. Make sure that the employees undersign acknowledgement that they have fully read and understood all the policies mentioned in handbook.
- 3. Overlooking employee training
An employer investing in his employee is always a return-proof investment. For instance, investing in training of employees is sure to pay-off for the company in the long-run. Unfortunately, many small businesses overlook this vital aspect. Employee training should kick-start right from the new recruits to the entire workforce for professional development. It has to be a consistent thing.
Onboard training for a new recruit right from the start prepares him to carve a strong foothold. Proper employee training is proven to help employees take-off amazingly well. On the other hand, employers remain assured that their workforce would perform at its optimum best.
4. Failing to document performance concerns
A disorganized termination can trigger an uninvited lawsuit. Whilst no termination is a positive thing, but it can be made a smooth one if organized well. Here, organizing means documenting as well as addressing performance issues of an employee at regular intervals. In fact, ensure to dish out feedbacks to the employee as and when a performance issue arises. Making this a regular thing gives a good opportunity to an employee to work on his weaker areas.
Feedbacks might fail to solve the issue making it difficult to avoid termination, but executing it the right way helps shun several unwanted problems. Nevertheless, it is advisable to document performance issues of employees on a regular basis. Though it is a bit time-consuming and tiring, it is of great help to execute a smooth termination.
5. Neglecting basic employment laws
Many business owners and managers neglect basic employment laws, which is detrimental to a company. Thus, it is advisable to get acquaint with employment laws pertaining to the following:
- Family leave
- Gender, race, age discrimination
- Workplace safety
- Medical leave
- Employee tax
6. Withholding positive feedbacks/praises
When was the last time you appreciated or praised an employee for a job well executed? When was the last time you shared constructive and positive feedback with an employee?
This is very much a need of the hour for small businesses. You ought to make employees realize their importance and worth to the company. Ensure to meet your workforce on a regular basis and praise their good work.
Failing to take out time and providing constructive/positive feedback to that go-getter may persuade him to leave your company.
Thus, it is advisable to avoid withholding positive feedbacks or praises from your employees.
7. Having personal favorites at workplace
To an extent, it is understood that you might prefer to hang out only with a specific set of employees and not others. This is certainly not acceptable and is a strict no-no. There are probably other folks as well whom you can spend some time with. Nonetheless, having personal favorites is never advisable.
Ensure you treat all your employees good and equally. Also, try to identify areas that require you to train your HR staff and managers for the same.
Okay, so these are the seven most common HR pitfalls committed by small businesses. Irrespective of whether you have deployed a dedicated HR team or not, it is highly advisable to keep away from these bloopers. It’s no rocket-science, but all your efforts will pay-off in the form of improved productivity, efficiency and increased employee retention rates.
Needless to say, employees are the most important assets for any business and it is time to have proper HR management software in place.