The Importance of Human Resource Management in Start Ups

Why is no business too small to benefit from investing in Human Resource (HR) and why do start ups need them?

According to Bishop & Crooks, (2016) Administrative duties in any company can be complicated and misunderstood. The process can be overburdening for small businesses. Companies with inadequate time and resources are left with no choice but to channel their efforts to matters of priority. This may not be quite right, since a major difference can be made through the functions of a professionally trained Human Resource Manager (HRM). The Human Resource is responsible for reducing administrative work hence creating enough time to concentrate on the company’s priorities such as meeting targets. Holbeche, (2012) adds that an HR in a company regardless of the size is responsible for accomplishment of a number of functions such as recruitment, training and development of employees among others. As much as an HR may be viewed by startups as an expensive affair, he can perform several roles that would have been outsourced to many service providers. The functions may include; plan management, payroll processing, recruitment and training among others. The HR would assist a company in saving cash that would have been spent on various administrative functions. The HR takes full responsibility for several functions hence providing all the needed expertise (Bishop & Crooks, 2016). (Magill, N.D.)

Why Start ups need to invest in HR

Magill, (N.D) asserts that the current market is equipped with new developments in Human Resource outsourcing. Cloud computing has been cited as one of the latest technologies where people can share and communicate effectively. The process comes with many benefits for employers and employees in a company. Kenton & Yarnall, (2012) believes technology comes with many benefits regarding quick access to information. Small businesses now highly depend on the social media as a means of identifying relevant talent. Social media is currently offering a good platform for locating effective Human Resource employees. The advantage with such arrangements is affordability where start ups have an option of choosing only the necessary part of the HR services. The following is the reasons why start ups need to invest in HR services.

To enhance Growth

Through the services of a professional Human Resource, the level of commitment towards growth is profound. The HR creates an environment of performance consistency, sustainability and continuity. Through effective services of a talented HR, a good infrastructure is needed to achieve the necessary scalability for the growth of the business. The company focuses on its mission, vision, values and goals. Future employees of the company are assured of an effective work environment (Scottsnell & Bohlander, 2012).

Sets effective foundations for the start up

Start ups would need services of an HR from the beginning, but it may not always be possible. HR would be useful once the company already has a team that is ready to take active roles that are not necessarily within the scope of management. The professional would be much helpful in scaling up the business in the direction of their needs (Lawler, 2012).

Help the company maintain a good position in the market.

An effective HR professional is considered a valuable asset to the company. Given this fact, it is prudent to hire them early enough during start up. Through their effort, the company is positioned towards performance (Magill, N.D).

Assist in recruiting the best talent

The effectiveness of a company depends on people. Start ups are assisted to recruit the best talents required in their area of expertise. The HR professional helps in identifying people that would be part of the lasting team (Lawler, 2012).

Ensure the mission is met

Start ups tend to succeed more with the help of HR professional at the onset of their business. The HR align company operation to the mission, vision and goals. This includes maintenance of the company image in the market (Lawler, 2012.

Talent identification and management

Magill, (N.D) says when start ups hire HR professionals, the aspect of training and developing clients is taken a notch higher. Job titles and descriptions are designed in a way that does not appear discriminatory. Accurate titles are formulated in a way that attracts the right candidates for the position. Once advertisements have been made, the manger with the help of other managerial staff conduct well structured interview. The interviews conducted are free from bias and open discrimination. The HR assist companies refrain from lawsuits through creating awareness on labor laws and other legislative matters related to business (Lawler, 2012).

Training and Development of Employees

Start ups need effective HR functions that are specialized in training employees. Through an effective HR, employees are offered competitive packages. The aspect of fair compensation of workers is looked at. The HR provide a platform where employees are free to discuss issues of pay rise. The process can be done based on what is considered the market value. Fair competition helps in improving issues relating gender pay disparities. Managers in the company are also trained for specialized positions instead of maintaining a generalist point of view. The quality of the managerial team in a company directly impacts on the performance of the organization (Magill, N.D).

Workplace culture

HR professionals create an environment where employees are able to contribute to the organization goals and objectives. This includes sharing vital information needed for the improvement of organization performance. Through this effort the employees can focus on building an effective workplace culture (Lawler, 2012).

Develop policies

As a business grows, the HR identify the need for policies. New employees are likely to feel out of place the first time they are hired. Experienced range from aspects related to managing expenses, time and noise among others. The HR works with various departments to raise up policies that eliminated conflicts (Magill, N.D).

Career Path

The HR works with the company to come up with the best process of developing employees programs that align them to their career path. Through these programs, problems related turnover which are considered destruction to employee morale (Magill, N.D.).

What is the importance of an HR perspective in your business Organizational Development and Strategic planning

Holbeche, (2012) companies have an opportunity of reviewing goals and objectives yearly. The Human Resource is good at coming up with strategies that are related to the goals and company’s core values. The HR attracts the best talents that aid in the success of the organization. The HR hired by start ups assist in improving on strategic planning of the organization and especially the overall goals of company. The benefits accrued from such associations include the following;- (Gummings, 2008)

Boosting employee morale

Gummings, (2008) admits that once a business finds the correct candidate for an HR position, he carries a number of functions such as performance assessments, talent acquisition, career path, getting the correct software and overall productivity of the company. Through the HR more estaff engagement is developed and job satisfaction fostered. The plan is important in enhancing a productive workforce. The job place today is characterized by a collaborative, team-oriented and mentoring attributes. Through these aspects, it makes it possible for the company to maintain talent. Formal development and nurturing of workers is paramount in promoting the corporate culture of a company and more so enhance employee retention (Lawler, 2012).

Positions the company for scaling

A business being established can grow exponentially when the HR team is involved at an early age. The process is gradual where the company can plan effectively. The HR has an idea of the direction the company should go hence they assist in make the change a reality (Lawler, 2012).

Shorten the hiring process

Bureaucracies in organizations tend to prolong the time taken in the process of hiring new staff. A professional HR assist in putting in place all the required resources needed in the recruitment process. The resources expected include, monetary, technology background search tools and building a strong brand achieved through effective marketing efforts (Magill, N.D.).

Streamline cultural diversity

Rosethorn, (2016) says the HR speaks from a business planning side hence it allows the company to hire staff from cultural diverse grounds. The HR also works on improving the existing culture through a positive thinking motifs instilled on employees. The workplace today is made up of employees that value career mentorship. Scottsnell & Bohlander, (2012) adds that the process requires hiring managers that contribute to the overall professional development. Such moves have a lasting effect on employee experience in the business. Business annual planning is a tool that the HR uses to improve on the company’s work environment to capture its goals, objectives and values. This improves the overall profitability and success needed (Rosethorn, 2016).

Role of HR in Strategic Planning

Rosethorn, (2016) asserts that organizations experience challenges from the economy based on attributes such as productive labor, struggle for survival, market condition and, competition. Initially, organizations valued material assets more, reduced expenses and minimizing costs. Through these strategies, companies were able to increase competitiveness. This approach no longer adds up in the business world today given the complexity and dynamism apparent. Organizations can now recognize the new for people and how strategies are implemented for success sake. Through this premise, Human resources have been given a powerful role related to formulation of strategic plans of the organization (Scottsnell & Bohlander, 2012).

The Strategic Planning Process

Rosethorn, (2016) reports that the strategic goals and objectives are achieved through development of measures that are relevant for organizational success. Strategic planning is well organized hence provides the needed direction. The HR is involved in designing tactics and necessary operational plans for effective success. The plan stipulates direction in terms of where and when the company wants to be within a given period of time. The work of the HR here is to ensure the company moves towards that direction. Mosley & Schmidt, (2017) admits that planning is treated as an ongoing process hence it transforms with time. As the company experiences challenges, it formulates coping mechanisms which forces the strategic plans to change as well. Strategic plans beginning from the pre-planning level prior to introduction of its components.

Mosley & Schmidt, (2017) agrees that pre-planning level requires commitment from the leaders that make decisions relating to time frame, participants and planning tools. The next level is a thorough scan of the environment to identify strengths opportunities and threats (SWOT Analysis). Forecasting itself is a strategy inspired by mission, vision and goals of the organization established. Implementation of the goals, budgets, actions and operational plans is the next stage. All these functions are incorporated into the strategy. Rosethorn, (2016) sats people are the main participants during the implementation plan. The objectives of this operation are mapped into the practical steps demonstrated at each level. Once the employees take active roles in the process, the strategy is made effective. The aspect of evaluation of the strategy is carried out regularly to ensure the strategy is successful (Scottsnell & Bohlander, 2012).

Employees through the leadership of the HR are expected to demonstrate their willingness to embrace and support the strategic plans. The HR should share the strategic goals hence displaying the value of the HRM Department. The business needs to see the value instilled into the organization. Through this, it is easier to understand the HR functions and its contribution to the overall success of the organization. The process allows it to improve on the expectations held by the company. The transparency in the process contributes to the overall goals and the significance of an HR professional in the team (Mosley & Schmidt, 2017).

Holbeche, (2012) believes companies that seek for the services of the HRM look for certain traits that are mapped into their job description. Job characteristics and positions in this field include, HR assistant, Management or Director. All these titles within the department are responsible for provision of quality services to the entire organization. The administration function for instance has taken may roles. The administrative purpose has changed over the years to include employee advocacy function. The practitioners are now faced with the pressure to rethink their roles within Department. Mosley & Schmidt, (2017) agree that the purpose of having them is to bring a balance in the various organization operations and more sore build a good relationship between employees and employers. Through this association, the company build its brand in the market. As a brand it accrues some value and quality service delivery. The human Resources maximize the opportunity to get through with their process of ensuring that all the plans set out are achieved by all the employees (Scottsnell & Bohlander, 2012). Initially, the Human Resource Management (HRM) was considered the personnel department. Further divisions were made to include, Human Resource Management and Human Resource Development. HRM is considered part of the strategic plan since most people and businesses rely on people to make profits. Strategic planning plays a crucial role in the productivity of the organization. The following are some of the strategic roles of the HR. (Lawler, 2012)

Staffing

Staffing is a strategic plan aimed at finding out how many people required to be hired. HRM’s duty is to conduct the hiring process hence selecting the correct team needed for the job (Magill, N.D.).

Formulating Policies

Policies are formulated in order to reach acceptable strategic plan goals. Once the policies have been achieved, the policies are communicated based on security, safety and flexibility of scheduling. The HR managers collaborate with supervisors to enact these policies (Magill, N.D.). Compensation and benefits

The HR is responsible for streamlining the compensation and benefits. The process can be discussed in terms of employee retention, training and development. The HR had to decide on the best way to retain the best talents (Lawler, 2012).

Training and Development

The process of training and development assists new employees to come up with effective skills required in their job description. Through mentorship programs, the employees are nurtured to grow their skills as expected by the HRM. Important tasks needed in training and development is highly related to succession planning. The employees are gradually taken through their new roles in readiness for assuming their positions (Kenton & Yarnall, 2012).

Regulatory Issues

Scottsnell & Bohlander, (2012) argues that regulatory are related to worker safety, health care and up to date information regarding new legal requirements. The role of trade unions is featured in this case. In small businesses managers are known to shoulder the HRM functions. They take up the responsibility of hiring, training and deciding their remuneration packages. Larger companies take similar responsibility, but the difference is in the number of employees at each. The aspect of hiring specialists to handle the process is an advantage to such companies over small businesses. When a manager takes up the tasks of recruitment, there are chances that strategic plans of the organization will be side-lined (Holbeche, 2012).

Role of the HR in Organizational Development

Scottsnell & Bohlander, (2012) admits that organization development is based on the Ulrich model. The model requires the HRM to come up with some components for strategic planning such as staffing, organizing, controlling and co-coordinating among others. Human resources look into the procedures of enhancing a productive workforce. The aim is to ensure the employees can perform their duties effectively. People are viewed more or less like assets. The HR organizes employees in a way they can perform their duties according to expectation. Organization development includes the following roles in productive planning (Cheung-Judge & Holbeche, 2015).

Human Resource Management Team

The role of the HR is to strategically organize the team into a business resource. Recruitment is part of the organization and coordinating their efforts. The managers in this case act as consultants and not as normal workers. The work accorded to them is advisory in nature based on issues of meeting organizational goals (Bishop & Crooks, 2016).

Team work

Employees at all levels of organization and the HR work together to build required skills. This includes assisting the organization to assume active roles that take advantage of their environment. Teamwork brings about great flexibility since employees shift from one operation to another within the company. This depends on aspects of business priorities and preferences (Scottsnell & Bohlander, 2012).

Building commitment

HR professionals provide strategies needed to increase employee commitment to the company goals. HRs matches candidates with the right job during recruitment. Employees hired work hard to maintain their jobs despite the challenges faced by startups (Kenton & Yarnall, 2012). Building capacity

The HR is known to create stability in business including developing competitive advantage. This builds the company’s capacity to set standards in terms of providing unique goods and services. Start ups face competition from similar companies as regard to recruitment of exceptional talents. With HR services, it not all about recruiting them but helping them to grow (Holbeche, 2012).

Dealing with Issues

Human resource management needs careful strategic planning to deal with the changing needs experienced by employers. The aspect of the disparities in the job market needs to be addressed as well. Employee remuneration packages should be revised regularly to maximize on employee retention (Kenton & Yarnall, 2012).

What is HR Marketing (Employer Branding) and why should start ups and small businesses be focusing on it.

Mosley & Schmidt, (2017) says employer branding refers to the process used by companies to promote itself to the target group as the best. Whenever a business is being established, it is hard to cope up with the ramifications that come with it. At such a moment, it is almost impossible to think about the HR. Branding is deemed a significant component when starting up based on nuggets such as customer acquisition, creation and retention. Rosethorn, (2016) adds that the management is required to make positive projections towards containing the new changing demands. Entrepreneurs are known to spend about 40% on what is beyond the non-revenue activities. The process of out sourcing is a challenging. The start ups deal with the heated competition amongst the big and well established businesses out there. The small companies have to venture on strategies such as developing a strong employer brand. An effective employer brand image creates a positive impact on applicants (Rosethorn, 2016). The following is reasons why small businesses should focus on it.

Values

Rosethorn, (2016) observes that companies that depend on hiring managers may not build an effective organizational culture. Through the HR team, companies ensure work experience is not only about job titles but more of value added to the company through cultural diversity. Value here comes as a result of affective leadership styles brought about by HR professionalism. Mosley & Schmidt, (2017) reports that the HR uses collaborative efforts among the employees to ensure there is accountability and knowledge sharing. The employer brand needs to be coherent which comes with great advantage for start ups. Through employee engagement, it is easier to communicate the mandate of the company. Through the help of the HR start ups easily build a collaborative team that is well placed to provide the required feedback. Such an arrangement increases value to the business as well as to employees. The HR offers the necessary leadership to the employees which increases flexibility and responsibility (Rosethorn, 2016).

Hiring

Employer branding assist in the development of hiring plans and at the same time streamlining business strategies. There is a lot to do with staff restructuring and use of technology. Competition is highly watched at this level through the HR evaluation and the same applies to talent capability. The HR ensures that employees are accountable and responsible for their own actions. The expectations are well labeled in their job descriptions. An assessment of the right blend of staff is done that would ensure the future welfare of the company (Mosley & Schmidt, 2017).

Building reputation

Start ups require employer branding from the onset for the sake of building a lasting reputation in the market. The procedure begins from focus on the company’s collective vision which can only be possible through a well coordinated culture. Candidates need to spot the company’s vision and familiarize with it. Through this familiarity comes attachment to the overall goals and objectives of the company (Rosethorn, 2016).

Attracting High Quality Job Seekers

Leaders in small businesses need to understand the real value of employer branding given that its attracts high-quality candidates. Through this understanding, it makes it possible to locate quality unique attributes at their disposal. The HR has the ability to promote effective performance management which brings out excellent rewards, development opportunities and disciplinary actions (Rosethorn, 2016).

Performance management

There are disparities between well established companies and start ups regarding challenges experiences by each. Through the employer branding the HR seeks to establish performance management by locating opportunities needed. The HR ensures the alignment of each job description with company’s strategic goals. The move ensures that all employees are aware of expectations in terms of performance and behavior (Scottsnell & Bohlander, 2012).

Competency Improvement

The HR Department is mandated to select the right candidates for the job. The process requires mastery of the expertise, skill and their level of education. This can be met through ensuring clear job descriptions and adopting on competency models applicable to various departments within the company. Smooth running of the business can be achieved if. The HR takes into account important information regarding to transactions, staffing and costs (Rosethorn, 2016).

Making Clear the Organizational Dimensions

Through the help of the HR employer, profiling exposes the company organization structure. The prevailing culture forms the basis for application of leadership styles that go in line with the values of the organization. Setting the dimensions is a signal to the candidates on what the company is all about. The nature of business conducted impacts on the role of the HR and especially the chain of command. Structures such as policies, practices and information systems should be well established according to various employee roles (Scottsnell & Bohlander, 2012).

Definition of mission, vision and goals

Mission, vision and goals of a small business play a major role in determining HR strategies required. Through the mission it is possible to understand the reasons for the company’s existence (Rosethorn, 2016). The vision expresses the projections of the company and especially in terms of future developments. The values of the company determine the driving force related to the operations of the business. These determinants are important during hiring of employees to the company. The company through the HR uses these aspects to gauge the caliber of employees required to achieve organization goals (Scottsnell & Bohlander, 2012).

Workforce Diversity

Workforce diversity is part of the HR strategic plan to focus on organization performance. Through this attributes of culture, systems and people is merged and aligned with the mission, visions and values of the company. Workforce diversity also requires identification of gaps in the human resource and assigning roles that bridge them (Rosethorn, 2016).

Implementation strategy

HR strategies in start ups are evaluated based on specific and measurable factors. Start ups aid in identification of factors needed to achieve performance effectiveness. When the organization evaluates it functions, it gives them important facts needed to make changes. Changes in this case include the aspect of filling positions, dealing with customer complaints and employee turnover (Holbeche, 2012).

The business world is challenging and especially when it is starting up. Business ideas are conceived and implemented but its success can only be realized based on effective guidance. When the business is beginning, the aspect of cost eats up the company’s budget making it hard to slot in the need of HR services. The company that is starting is known to outsource major services for lack of effective strategic planning. Through engagement with the right stakeholders including the need for a Human Resource Manager, the organisation can be channeled towards achieving its goals and objectives (Holbeche, 2012).

The HR is known to align company operations with strategic goals. The process occurs gradually through a good thought out plan with the help of good leadership skills. The HR acts as a bridge between employees and the company. The company would also need to market itself to attract the best quality employees. The business should consider the need for building an effective work environment that would be suitable for users. As they do so, companies also foster future endeavor of the business. The organization incorporates values into the image and branding of the business, In the overall, start ups are deemed challenging ventures that need mentors inform of managers to assist them scale up the ladder of success. The process takes into account aspects of work force diversity and more so culture.

A closer look into the company’s mission, vision and goals assist in positioning it competitively in the market. The HR builds the bridge between the employees and the organization. Through the department management also aligns goals with resources and the overall budget of the company. The business require effective team that would utilize skills to achieve the company’s success. Start ups need to rethink about the need for seeking HR services to save on cost and to position it strategically for success. The services offered assist the company to avoid making mistakes that jeopardize the normal functioning of the business.

References

Bishop, M., & Crooks, S. (2016). HR for Small Business for Dummies . John Wiley and Sons.

Cheung-Judge, M.-Y., & Holbeche, L. (2015). Organization Development: A Practitioner’s guide for OD and HR. Kogan Page.

Gummings, T. G. (2008). Handbook of Organizational Development . SAGE .

Holbeche, L. (2012). Aligning Human Resources and Business Strategy. USA: Routledge.

Kenton, B., & Yarnall, J. (2012). HR: The Business Partner . USA: Routledge.

Lawler, E. (2012). Effective Human Resource Management: A Global Analysis. USA: Stanford University.

Magill, A. (N.D). 4 Reasons To Invite HR To Your Strategic Planning Meetings. Retrieved July 12th, 2018, from https://www.fastcompany.com/3041098/4-reasons-to-invite-hr-to-your-strategic-planning-meetings

Mosley, R., & Schmidt, L. (2017). Employer Branding for Dummies . USA: John Wiley and Sons.

Rosethorn, H. (2016). The Employer Brand: Keeping Faith with the Deal. USA: CRC Press.

Scottsnell, & Bohlander, G. W. (2012). Managing Human Resources. Cengange Learning .