Hiring an HR (human resources) team may appear as an unnecessary expense to numerous small business owners. Nonetheless, engaging an HR professional could prove to be highly significant in the development of your business.
Having a human resources department can enhance the efficiency of payroll procedures, improve recruitment practices, foster employee engagement, and provide better safeguards against legal disputes within the workplace. Ultimately, a robust HR team, whether composed of multiple HR professionals or a sole individual, contributes to the enhancement of company culture and working conditions.
Running a successful HR team in a small business can be challenging. In this comprehensive guide, we will explore the crucial aspects of human resources, understand the significance of having an HR department and recruiting HR managers, and learn effective strategies to ensure its success in various areas.
The role and significance of an HR department
Human resources, commonly referred to as HR, involves overseeing and addressing employee relations within an organisation. HR professionals are entrusted with a broad array of responsibilities that revolve around managing the personnel of a company. Here are several instances of the various areas that HR departments handle.
- Payroll
- Recruitment
- Maintaining health and safety
- Performance management
- Enhancing Employee Involvement and Loyalty
- Training and Development
- Attendance and annual leave
- Inclusion and Diversity
Several small business owners opt to manage these tasks themselves or with their senior management team instead of hiring HR professionals. Nonetheless, taking on HR responsibilities without a competent HR team can expose you to potential payroll problems and hinder your ability to resolve employee conflicts in a lawful and efficient manner. Additionally, lacking HR expertise and experience may limit your capacity to devise optimal strategies for employee engagement, retention, and training within your organisation.
A Comprehensive Handbook for Small Businesses on Building a Successful HR Team
Now you’re convinced that having a dedicated HR department is the way to go, you need to know more about how to get the most out of your HR employees and processes.
Here are some effective strategies you can employ to establish a thriving HR team for your small business.
1) Provide a clear definition of the company’s culture and mission statement.
In the realm of HR, a significant aspect of their role revolves around the recruitment process. It falls under the purview of the HR department to actively seek out and entice highly skilled individuals in the field. Consequently, the HR personnel will devote a significant portion of their time to crafting job descriptions, conducting interviews, selecting suitable candidates, and ensuring a smooth onboarding process.
However, before they can succeed at this, your HR department needs to have a clear idea of the company culture and mission statement. What are the company’s goals? What’s the atmosphere like in the office? Are there any social/networking activities? All of these questions need to be answered so that the HR department can communicate the company culture and HR mission statement to job candidates during the hiring process. Ultimately, having a well-defined culture will be appealing to potential employees who want to find out if your company is the right fit for them.
2) Set clear expectations in job descriptions
A proficient HR department, apart from outlining the company culture, plays a crucial role in establishing explicit job expectations. This entails specifying the necessary skills and qualifications and thoroughly addressing the day-to-day responsibilities.
In order to establish clear expectations within your HR department, it is important to communicate your requirements for each open position. By providing this information, not only will your HR team have a clearer understanding of how to craft job descriptions, but potential candidates will also value transparency, increasing the likelihood of their application.
3) Ensure an effective onboarding experience is crucial.
After hiring a new employee, it is essential to facilitate their integration into the company through a thorough onboarding procedure. For optimal performance of your HR department, it is crucial to ensure that this process is seamless and well-defined.
A substandard onboarding procedure can greatly discourage newly hired individuals. It may cause them to feel overwhelmed and uncertain about seeking assistance. Additionally, insufficient support and training could lead to costly errors being made before they become familiar with their responsibilities.
It is essential for your HR department to establish a well-defined and thorough onboarding procedure for every new employee. This process should include extensive training specific to the position, introductions to colleagues, safety and health training, a designated timeframe for onboarding, and ample opportunities for the new employee to engage in discussions about the onboarding process with an HR representative. Additionally, implementing a mentorship program where new hires are paired with experienced employees who can provide guidance and support is highly beneficial.
4) Write all HR policies in an employee handbook
Your knowledgeable audience will need to be informed about the various responsibilities handled by your HR department in your business, such as payroll management, annual leave tracking, performance evaluation, and employee relations. To avoid any confusion or disagreements, it is crucial to effectively communicate HR policies, such as sick leave protocols and attendance requirements, to all employees in a neutral and informative manner.
Creating a thorough employee handbook and distributing it to all new employees is the most effective method for HR teams to communicate company policies. Whether in print or digital format, providing each employee with a copy of the handbook guarantees that they are fully aware of office regulations and expectations.
5) Familiarise yourself with the regulations pertaining to
It is important for both your employees and your HR manager and leadership team to have a clear understanding of workplace expectations. However, it is equally crucial for your HR department to be aware of its legal responsibilities. Failure to have knowledge of relevant employment laws can result in legal complications if an employee files a complaint regarding matters like salary or discrimination.
It is highly beneficial to have a dedicated HR team consisting of knowledgeable and experienced individuals when it comes to protecting your company from potential legal issues. Hiring HR employees who are well-versed in UK employment laws and who understand the significance of documenting important conversations for evidential purposes can greatly help in the event of a dispute.
6) Enhance HR processes by leveraging technology
In the realm of business, there exists a vast array of software applications that cater to various needs. These include VAT software, project management software, time tracking software, and CRM software. By utilising such software, businesses can optimise their operations, leading to enhanced productivity and efficiency.
In order to maximise the efficiency of your HR department, it is crucial that they are equipped with the necessary resources. For instance, to streamline payroll processing and minimise mistakes, your HR experts should have the ability to utilise accounting and payroll software. Additionally, to monitor employee performance, it is important for them to have access to time-tracking software and other performance management solutions.
Technology can play a significant role in enhancing employee engagement, an area of great importance for HR departments. Software applications such as Perkbox and Kazoo provide opportunities to recognize and reward employees, as well as create a social hub, thereby boosting employee satisfaction and engagement. Moreover, these software tools offer the capability for employees to share their feedback through surveys, enabling HR teams to brainstorm strategies to minimise employee turnover.
7) Establish a system for evaluating performance
Regrettably, there might be instances where an employee fails to meet the desired standards. In such situations, it is essential for your HR leaders to have a well-defined performance evaluation process that can either aid the employee in addressing the problem or begin the termination process.
Having a performance review process with an action plan and scheduled meetings will ensure that all employees have a fair chance to improve their performance at work. If the employee does end up being dismissed, they won’t have a case for unfair dismissal if they were given plenty of chances. Your HR team should always keep a written record of this review process in case a former employee makes a claim to an employment tribunal.
8) Invest in training as a crucial step
The HR department is responsible for training and development as well. It is crucial for the HR team to ensure that every employee has the chance to enhance their skills and advance within the company. This not only benefits the organisation by moving it in the right direction, but it also greatly benefits the employees as they will feel appreciated and valued.
Investing time and financial resources into employee development through a training program is an effective means of enhancing expertise within the organisation and promoting employee retention. Allocating funds towards training the existing workforce proves to be more cost-effective than repeatedly hiring new employees.
9) Introduce additional advantages for employees
Employee benefits play a crucial role in enhancing employee satisfaction, which, in turn, helps mitigate employee turnover. Alongside training, these benefits encompass various aspects such as flexible work options (remote or hybrid), increased vacation time, discounted fitness centre memberships, and potentially shorter work weeks.
In order to keep skilled employees, it is important for the HR department to recognize potential avenues to introduce fresh perks that will be positively received by the staff. One effective approach is to distribute surveys and solicit input on areas that could be enhanced within the organisation. By directly obtaining feedback from employees, the HR team can discern the employee benefit that would garner the highest favorability (and consequently prove most effective in staff retention).
10) Listen to feedback
Listening to feedback is an essential aspect of the role of an HR professional. A proficient HR department constantly endeavours to ensure the satisfaction and productivity of employees, aiming to retain valuable talent.
Collecting surveys is an effective method to obtain direct feedback, as stated earlier. Furthermore, conducting exit interviews provides a valuable chance to inquire about the reasons behind an employee’s departure and gather suggestions for enhancing the organisation.
Tips for Managing an Effective Human Resources Department
A proficient HR strategy and a competent HR department are essential for every business, regardless of its size. Failing to have an efficient HR department can lead to difficulties in adhering to employment regulations, hiring exceptional employees, and retaining top-notch staff members.
Luckily, if you want to establish a thriving HR department in your small business, you can easily achieve this by adhering to this informative guide. Utilising modern technology, implementing a well-designed onboarding procedure, compiling a comprehensive employee handbook, actively seeking and considering feedback, and introducing additional employee benefits are key steps to ensure the exceptional performance of your HR department.