In the small to medium business sector after finance, IT and marketing, HR seems to come in last place in the operations priorities. I have often pondered why this may be the case? If you think about it, most businesses start as an idea a business owner is passionate; they work themselves to the bone, with no salary to get it off the ground, then some money comes in so they need the financials sorted and guess what - many business owners are more than happy to get their accountant to look after it.
As businesses grow they need good IT infrastructure to make life easier. I love my IT as much as the next person, until it doesn't work, and then I urgently need someone to fix it as I'm so dependent on it. Then there is marketing. Let's face it they are in marketing so are very good at selling their value proposition.
Then comes the lull - things have been ticking along nicely, growing bit by bit and one's mind turns to the 'touchy feely' HR that has yet to been ticked off the business plan. Headcount is starting to grow - ‘but wait, I have got away with it for this long - why invest now?'
And other questions; are you really getting away with it - what do your employees really think of you and your business? Do you know or, maybe more importantly, do you care? Do they have great ideas that you have no idea about? Can they see possible productivity gains that you can’t? Are they doing what they should be? How long are they planning on sticking around?
Talking of productivity, are you able to measure it? Can the current structure support rapid growth or will it break? Are you and more importantly your team all invested in the mission, vision and core values? Would the culture of the business be consistently described across the business and would you like what you hear?
Then there is the harsh reality of the Fair Work Act and your very important legal obligations. Are you operating under the terms and conditions of the correct Award? Do you send out the Fair Work Information Statement to every new employee? Do you understand NES, Flexible Working and Redundancy under FWA?
The truth is that any business with more than one employee has HR elements that need to be addressed such as recruitment, employment contracts, performance appraisals, training promotions, parental leave, flexible working, non-performing employees and conflicts, succession planning, motivation, engagement and retaining your best employees, to name just a few! If you want your business to succeed, grow and flourish you need to manage your employees and not just leave it up to luck.
I think that the answer to the original question is both - HR is a necessary evil from a legal standpoint but it can reduce costs in terms of possible fines and also make a difference to your bottom line. Having the 'right people in the right place at the right time' and future-proofing your business by understanding your skills inventory and potential, will meet and overcome any roadblocks that arise enabling you to quickly and effectively grow your business.
Natasha Hawker owns Employee Matters Pty Ltd; an HR Consultancy that assists small to medium businesses with their HR functions to make them more efficient and profitable. Their offering includes HR Management, Recruitment, Training, Coaching, and Exit Management. – find them at www.employeematters.com.au
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