Building a Strong Foundation: Best Practices for HR in Small Businesses

By: Phil McCarthy

Before you can make the most of HR, there are some best practices that will allow you to build a solid foundation to the business. While relevant to any business, it is particularly important for small businesses to emphasize a culture of empowerment and continuous learning. Unless you want to “do it all” as an owner, giving employees responsibility and authority to make decisions is very important. With that empowerment comes responsibility, and it is also important that employees are continuously attempting to learn new things and apply what they have learned to improve the business. Everyone should also be prepared to adapt to change, whether it be the adoption of a new idea, or a new behavior by the company. Agility is also key, and employees should have the ability to anticipate, cause, and adapt to change, while taking specific actions to support change.

The organization should maximize employee engagement to ensure that employees are fully involved in their work and committed to their job and the company. Engagement surveys show that only 34% of U.S. employees are engaged in their work. Disengaged employees can be extremely costly. Organizations also need to manage talent by attracting, retaining, developing, and motivating their employees and managers. Finally, organizations should be prepared to recognize, and then capitalize on the demographics and diversity of the workforce. That is to say that there are current changes being projected in the workforce, and organizations need to be prepared to make the most of those changes. For example, the average age of the workforce is projected to increase, the workforce is becoming more diverse in terms of gender, race, and generations, and immigration will continue to affect the size and diversity of the workforce.

No business foundation would be complete without a clearly defined organizational mission. The mission is a statement of the organization’s reason for being. It usually specifies the customers served, the needs satisfied and/or the value received by customers. The mission statement is often accompanied by a statement of a company’s vision and/or values. While it would be impossible to fully define in the confines of this article, numerous resources exist to assist in this process. In his now famous TED Talk, and in his book Start With Why, Simon Sinek does an excellent job of illustrating the point and sharing best practices. The important part is that you take the time to determine why your business does what it does. Once you can define your purpose, cause, or belief, you can attract those who believe. Once you have a mission in place, you can operationalize it giving your employees a North Star to guide them.