Small business owners shouldn’t neglect HR

Editor’s note: Michelle Stockman is an independent consultant with her company, Fort Smith-based Msaada Group. Stockman earned a bachelor’s degree from Loyola University-Chicago in communications and fine arts, and earned a master’s in entrepreneurship from Western Carolina University. Her thoughts on business success appear each week on The City Wire.

Hollywood often portrays a golden period of time when men held management positions, women, if they worked, were secretaries and big business was the priority. During this golden age, working for one company for the duration of a career (20-30 years) was normal, life seemed simple and promotions were the “focus of dreams.”

Fast forward to today where your average person stays at a job for 18-24 months, where today’s 20 year old will have 14 career changes by the time they are 40 and starting a job in today’s company is a legal jungle coupled with at least a few hours orientation to complete paper work that is required upon hiring.

For companies with 100 or more employees, the human resources discipline is a science. However, human resources is an often neglected and overseen function in small businesses (at least those with 50 or fewer employees as companies are not required to have HR representation on staff in companies this size). While not requiring an HR staff person is a blessing for small companies, ignoring human resource function within the small business can be a costly mistake.

As the business leader, you are very involved in the hiring of new employees, as well as making sure they understand how to perform their job. Sadly, this is where most business owners start and stop their HR efforts. Often, the new employee will do great for the first few months and the business couldn’t be better. Yet far too often, the good days end with some form of problem or struggle with the employee. This typically leads to an employee leaving and hurt feelings on both ends ensue. Sometimes, the employee may even harm the young business in some way.

However, when the business leaves good human resource practices aside, that business person has also left the business vulnerable to potential harm by the employee. Granted, most employees do not start their jobs trying to find ways to harm the hand that feeds them. However, when feelings get hurt, there is an open door.

Small business owners should not stop their HR efforts with just hiring and firing employees. Small businesses can and should put an employee manual (that gets signed by the employee) in place, which outlines the policies and procedures for the company. This not only orients the new hire, this allows the business owner protection from the employee if they violate the procedure. If a business has information or clients it needs to protect, the business owner should also have their employee sign a no-compete statement that legally protects the business yet does not block the employee from future meaningful employment.

Lastly, small businesses should also put an employee review process in place as a means to communicate work performance with the employee.

Good human resource practices are an excellent habit to get into early for your business. Don’t wait until the business had to learn a lesson the hard way. Be proactive in building a business culture that communicates the desires and direction of the company.

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Stockman can be reached at [email protected]