What exactly is a small & medium-sized business? Well, there’s no real concrete definition; it can vary depending on a number of factors  –  revenues, employees, the market … but generally when we look at it from a targeting and a business segment perspective, it tends to be companies with an employee base of less than 500 full-time staff. It can be as high as companies up to a thousand employees, if HR is really being under-utilised, or if a lot of the work is seasonal – so companies which have a big summer season, for example, may hire people from June to September, but it won’t necessarily represent their full employee base throughout the year. So we tend to work with the model of less than 500.

 

In terms of what benefits there are in working for a small & medium sized business, there are many.

• There is a very clear and direct line of sight in reporting to the CEO or the owner. Often in large companies, it’s difficult to work out where you stand in the overall make-up of the organisation – who’s between you and the top of the work structure.
• The owner tends to be very active in the day to day running of things; they’re usually very in touch with the employees, so you have that sense of seeing and hearing from them more often.
• Limited silo or siloing of the various departments; the departments tend to be more interactive & interconnected, often leading to a greater opportunity for collaboration inside the company. 
• Easier access to the entire employee base, either through internal meetings, webinars, or just walking the halls and being able to see your colleagues day to day.

 

The obstacles? Well, there are a few of those as well.

• Budget – Can be a problem; in a lot of business cases we tend to see that the smaller the company, the tighter the cash position.
• Time – Often again, in smaller companies people are often wearing multiple ‘hats’ , so if you’re not spending the 40 hours a week doing your own job, you’re spending a significant amount of time  doing other assignments, so time can be very critical and we do often see employees doing different things.
• HR footprint – The nature of the people that are hired and the looseness of the organisation tends to be greater in smaller companies; there’s not as much process and often things are more paper based than technology based, and HR can have a difficult time managing all of that, leading to less of a HR value.

So why do small & medium sized businesses need talent management? Well actually, a lot of the reasons are similar in why large companies need them – they just tend to be more emphasised.

 

First of all, it’s important to align employee activities to corporate goals. Whether it’s a large company or a SMB is irrelevant; someone can be doing a job which is really great, but if it doesn’t make you money or improve business processes, then it’s really not an effective use of their time or position.

 

We definitely need talent management to improve internal communication. With everybody running around doing different jobs, you need to be able to get people the information when they need it most.

 

Of course, you need to manage the talent processes and the whole employee life cycle. Recruiting, performance management, learning, development, all of those areas need to be managed, and if they're disjointed, they often tend to fall between the cracks as you try to implement things.

 

You definitely need to develop leaders and key contributors. The thing about small to medium size businesses is that a lot of their managers tend to be home grown and perhaps doing management for the first time, so development is extremely important in companies of these sizes. And of course like in every company, you need to attract and retain your top performers. You have to communicate why it's to someone's benefit to come work for a company of your size, and what you can offer in lieu of some of the larger, possibly more financially secure companies.
 

Not long back, World at work did a survey, and this wasn't limited to small to medium sized businesses, but of all businesses, of what's important to employees looking at an organisation. Compensation and benefits were largest, work/life balance was second and career development was last.

 

But, what was interesting was that if you go to Hewitt, this is actually what employers are saying that employees are telling them. And 30% of survey participants said that career development was more important to them than pay as a  reward strategy with an additional 55% saying it was of equal importance.

 

But almost everyone in the survey, or 85% of employees, said that they were looking at career development within small to medium size businesses. So it's very important in your pitch to potential new employees, to attract and retain them, is that you endorse the idea of career development.

 

So how do you become one of these employers of choice? Everyone wants to be on one of these 'Best to Work For' lists, whether it's on a local or international level. And even the ones that don't qualify somehow find a way to brand themselves as the employer of choice, by saying well 'we do this' or whether someone else recognizes or not. But everybody is attempting to get to this – to attract and retain top talent.

 

But you can walk the walk, but really you need to back it up with action. Saying our people are our biggest asset is a common soundbite we hear, but if you're saying it and not backing it up with process and support, it's soon going to become apparent to the employee that maybe this company isn’t all it was cracked up to be.

 

So what can you do to actually give this branding?

 

Well, it's not something you can necessarily do off the cuff – it's something that you may have to sit down and plan out with development strategy ideas and goals that you can plan and manage to achieve. As a small to medium size business, you don't have the benefits which some of the large conglomerates hold in terms of brand recognition. So everybody knows Google and Coca Cola as being gold-standard brand names – whereas companies under 1000 employees or particularly those under 500 employees don't have that recognition, so you have to do more of it yourself.

 

So, how do you do this? Well, where's your best source of information? It's your own employees. So have brainstorming sessions within your company, get the department heads together, figure out who's your competition, to get employees and to get market share, and what are your key differentiators. Are these the things you want to pitch to new employees and current employees to let them know this is the place to be? And then what are your key competencies as a company? Is it the service you provide? Is it the quality of product? Is it the quality of individual you put in front of people? And calculate what is your unique value proposition. So a lot of large, multi-nationals already have a unique brand proposition – your job is to figure out what is yours.
 

And then once you've figured out all these things, you want to make sure that you can communicate it to your employees. Nothing is more important in the company than a mission statement which everybody knows, which is told to new recruits when they come on board, and everybody who recruits to bring new employees to your company are well aware of the statement.

 

Look at developing a tag line which goes on your website, letter heads, everywhere, and this actually can be something you can rotate to highlight different areas of your business.

 

Other communication vehicles can be taken advantage of; monthly newsletters, company webinars, company meetings, these are all key in communicating out the message.

 

And as we say, you put the message out there, then you've got to back it up with actions, so put in performance strategies, development strategies to your employees to show that 'we're going to invest in you, and we want you to be a key contributor to the company'.

 

And you may not have all the answers on the management team, so make sure you leave it open to the employees to allow them to give you suggestions, whether it's in a suggestion box or any other method, and provide incentives for individuals to provide this information.
 

 

So lets talk about some of the key areas of talent management … and the first one is Recruitment. You want to attract and bring in the best people, so you post jobs to your website, put them on job boards, in newspapers or whatever, but how do you actually promote your most open roles?

 

The best way is employee referrals of course – and you want to provide incentives for this – whether its referral bonus fees, cash, movie tickets, prize draws – all of these are good ways to motivate your employees to bring people over. But the key thing is that if you create a great company and workplace, you won't even have to offer these things, they'll be secondary and your people will be thankful to just come into a positive environment every day.

 

But beyond employee referrals, you definitely want to post your openings on your career site, and to track and move and optimize that, an applicant tracking system is paramount. Being able to manage this process of finding, recruiting and onboarding employees. The thing is that many companies think that an ATS is cost-prohibitive, but the SaaS models like the one HRsmart provides, allow a really affordable per month rate for companies to actually put an applicant tracking system in place. This then gives you a huge candidate database, allows you to post directly to all of the major career sites, and it gives you an online management tracking of applicants.

 

Most of the recruiting these days is going to outbound recruiting, there's two places – there's the traditional jobboards but there's more of an evolution on those with the aggregation boards, with the CareerJets and the SimplyHireds of this world, in addition to the traditional career boards – such as Monster, which continues to be a big player in that market.
 

But social media has created a big explosion in recruitment, mainly to find and lure passive candidates; those people we tend to see actively looking for work will go to a Monster, or another traditional job board, but what about those really talented people who are already happy in their current jobs, might not know that there's a better opportunity or place out there, but they go to these sites, LinkedIn, Facebook, even Twitter, to find industry information or other things to do with their job – so these are great places to post openings and look for new talent you may not reach otherwise.

 

So when you find the right candidate through these methods, what do you want to do? Well, you want to make sure that they can perform and that you retain them. You want to bring people in who can make money for you, and make sure they're happy themselves, and make sure they're getting the right kind of compensation, and also that they're gaining a sense of fulfillment from working at your company.

 

So again, it's about planning, but also empowering your employees. So the big value that you can over as a small to medium sized business is that you can give employees that vision into their own career development. Where do I want to go? What are my skills & competencies? How can I work with my manager together on a development plan, with goals and development and measurement in place so that I can get to that dream job? So, for example – today I might be a salesman but in a few years I might want to be Vice President of Sales, how can I get there? What's it between? *

 

It's more than just drawing a flow chart. You have to manage performance and the key up top is the alignment of the organisational and corporate goals, and being able to have that direct line of sight from the employee to thatorganisation. Again, if you have someone who is great at something, but it doesn't return revenue or value to the employee, it's not a good use of time. So you want to get the competencies that are required for the job, that are essential to the business, and reinforce and measure them, and we need a formal review process for that, which is online and hopefully not paper based, and everybody should be moving away from that.

 

But this involves a lot of work on the side of the managers – you have to make sure that you're structured, and you do the quarterly or monthly meetings with your employees, provide the support to meet the goals, and then set the goals and build the development plans accordingly.

 

Again, automation is key in that it reduces objectivity. You can document things, it'll show in the system – and we're all human beings, even managers, so the objective nature of a managers opinion doesn't come into play as much when the results are so readily available within the system, showing the true scale of an employee's performance.

 

So when you have good employees and you want to put them on a development plan, a lot of the time that involves learning. There's a lot of different aspects of that, but you've got to show that you can invest in your employees – if you want to get them there you've got to provide the correct learning environment. Outside of the formal courses, there's good programs such as job sharing, where you can actually have someone participate part time in a job that they're looking to go into in addition to the job that they're currently doing… And also the ability to mentor employees, have some of your senior staff bring along some of your identified key employees and teach them the ropes in an on the job manner, rather than a purely academic one.

 

Anybody that's moving into management or any kind of leadership role has to be made aware of the legal ramifications, so compliance is very important, certifications, any of those types of things, you have to provide training to anybody who is going to be dealing with people.

 

The great thing about the internet nowadays is that there is so much material made available on the web – some of it's free, some of it is charged – but you can really find industry specific content for your particular sector, job, placein the market, so it's a good resource to go out and discover the content to go ahead and develop your employees.

 

Regarding Content Usually most companies,  have a sort of hybrid model; they buy some, but they have a lot of internally developed content, particularly companies which have been in business for a while. The most important aspect is that the learning environment has to be self service – you don't want to have to drag people out of their job to put them in a 3 to 5 day class to get them to the next level in the environment – the best way, particularly in a small to medium sized business, is if they can take courses on their own, when they are free, in an automated online manner; that way they can get the education needed with the least impact to their job.

 

And you've got to make sure that it ties to the development needs; both for the job you're doing now to make someone optimise their current contributor role, and also training them for future roles.

 

Succession planning is as or more important for small to medium sized businesses than large corporations – it's the process of getting the right people at the right costs time and time over again, and making the correct changes within the workforce.

 

Every role at a small to medium sized company is key – if you lose somebody, you need to have a person ready to move into that slot and not have to go out and recruit externally every time a key management or key leadership role is vacated.

 

So you need to be able to identify those key roles, and they're not just the c-level environment, and you want to be able to look internally for replacements – people who can move in, who know the company, who know the product, and possibly the only thing they need is training in that role. So check with your department heads on a regular basis – who are the key players there, can we target them for growth, and could they possibly move into one of these roles.

 

Too often succession planning is thought to be a process where an individual has to wait for the person above them to move on before you can get that role …. Actually, succession planning is key for growing companies, so today you might have only two Vice Presidents, but if you triple your business over the next ten years you're going to have 8 to 10 Vice Presidents, so it's not always a case of moving people into vacated roles, it's often about installing individuals into newly created positions at a similar level.
 

Analytics are very important – being able to see the numbers and show the measurement. There's kind of a difference between metrics and analytics; so metrics are a snapshot in time of particular things, and analytics really represent the trending – how is information measured over time, and what does this mean.

 

So you've got to be able it measure this, get the return on investment, and see how the improvements are related to the business – does this save us time? Does this save us money? Does this increase the satisfaction of our employees so we can keep them in the business …. and always look at the trending – say your company has 15% employee turnover –  is that good or bad? Maybe last month you had 25% turnover, that might be good, but conversely what if you only had 5% turnover! that might be bad. So trending really is very important for any kind of measurement of analytics.

 

Then look at the key things you need to measure – turnover, time to hire, employee satisfaction, company performance, individual performance. How are these improving over time? And are the remedies you're putting in place working? And that's really the road to success.

 

So the benefits of talent management are many fold …  so to try and sum them up here for small to medium sized businesses – it improves performance, it improves financial output, you have happier people and greater staff retention, and a better culture to attract and keep hold of that top talent. And being able to put all of that into one system in an automated fashion is extremely helpful for a small to medium sized business – the least amount of IT resource you have to use or integration needed to perform this, the better.