Importance of HR in SMEs
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For any business to run profitably, it is important to have the right kind of employees who work for you. When your business is an SME, it is more important, given that this sector employs a large number of people for its successful running. In order to ensure that your SME runs successfully, HR becomes extremely critical. This involves not only recruiting the right kind of people but also ensuring that they stay on. Here are some areas where the human resources manager or function is extremely important in SMEs:

  • Recruiting: As mentioned earlier, people are the backbone of any SME. Under these circumstances, it falls on the HR department to ensure that you are attracting the right kind of people to your organization. In order to achieve this, it is important to understand your organizational needs and make it attractive to the job seekers. This is where the role of the human resources department or manager comes into play. These are people who will ensure that you get the right kind of applicants for the jobs advertised by you. Moreover, when the applications arrive, they will scrutinize the same, keeping in mind the goals and objectives of the organization along with the vision and mission. This is not easy for any individual. Rather, it's a task cut-out for someone who is trained in the field of HR. It is important to note that businesses invest a lot of money and attention to all their employees. Therefore, getting the right person at the first go would mean that you would not have to waste your resources.

  • Retaining employees: Once the employee has come into your organization, it is important that you retain him or her. In this world of excessive competition, it is extremely easy to lose a good employee to your competitor. Here again, a good HR manager or department will help ensure that you retain your employees. This could be done in several ways - by ensuring good pay, perks, incentives, bonuses, challenges etc. When tackling the problem of retaining employees, it is important to understand what will make that particular employee stay. Your HR department/manager can easily identify the motivating factors that will keep an employee satisfied and yearning for more, and not let him/her go to your competitors. Regular appraisals, feedback, reviews etc are important even with SMEs and therefore having an experienced HR manager handle these issues is always helpful, as otherwise, such issues might never be handled the right way. 

  • Managing your staff: When running an SME, chances are that you are mostly concentrating on profits. Under these circumstances, you might not have the time or the inclination to deal with various problems that plague your staff. Having an HR person who essentially looks into guiding and managing your staff is definitely beneficial in such cases. It is also important to provide timely advice and support to employees, as and when required, which is again not possible by all SME owners. Here again, the HR manager comes into action, where he or she can actually provide all the information any employee might need for any problem or issue concerning them. 

Given that people are the most important part of SMEs, ensuring a happy and productive staff is an important task to be handled by the HR manager. One can either hire someone or outsource these functions, depending on their needs, budget, and the magnitude of such issues. 


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