Every mid-sized business was once a small business. But, you can’t tell just when it stops being small. Revenue measures or employee counts are not enough, varying greatly as those things do with the nature of the business.
However, there does come a time when everyone is feeling pretty good about things. People are happy they hung in there from the beginning. Looking back, they can share some laughs about the tough times. Owner and all are enjoying a respite from those early days of sweat equity.
Who needs HR?
If the business has gotten this far, who needs Human Resources? While the business is starting up and growing into its first years, there is little need for a formal Human Resources function. Everyone knows everyone else, perhaps, all too well. A first assumption is that the small business owner is not a neo-terrorist with bad breath. A second assumption is that the small business owner has leadership skills – enough to staff and guide a team with passion and energy. The first assumption will fail at business, and the second has a slightly better chance.
First phase
Leading through the birth of a business keeps everyone’s eyes on the prize and heart in the mission. The owner is one-on-one with each employee, able to coach and motivate, and get rid of anyone not onboard. At this stage, HR is mostly a matter of payroll administration and some minimal record keeping. You can always outsource quick answers on employee rights issues.
Second phase
Once you place some employees under the supervision of other employees, you will have a new set of problems. Once you have delegated that one-on-one, face-to-face, your risks increase. Hopefully, you make good choices in the supervisor selection and that supervisor literally speaks for you. If the supervisor does not change the passion and mission, you are on the right track.
However, this does strain the decision-making, performance tracking, and payroll functions. If the small business owner in you wants to have the system you want and value, you need something more than Excel or QuickBooks. You need an HRIS program that is accurate, auditable, and accountable. So, you need a personal button that tells you when this disconnect is getting out of hand.
Third phase
This phase brings us back to the start of this article. Once everyone feels comfortable with the way things are, that can mean you have stopped planning. Just because you are satisfied and comfortable now, doesn’t mean you will be so at the end of the next five years. If you have reached this stage without bringing an HRIS program in house, you are wasting your time and tasking your employees with planning that should be yours.
To get to where you want to go, you have to manage the present process better. It takes too much of your time to work the HR manual system, it exposes you to more compliance issues, and it offers no specific employee-relations advantage.
An HRIS program selected to fit your current and future needs is a cost-effective solution. It removes you from the negative aspects of Human Resources, all the system and details. But, it opens access to employees, lets them design their benefits package, and follow their own performance tracking (all within the rules you build in).
Some of the most powerful programs serve the largest companies best, but you can find the one that suits you and has the flexibility for expansion in volume and features later.
In India also HR and software requirements from Small Business is on the rise.
Thanks for sharing a good article
Great side by side comparison! My company recently went with an HRIS program so this brings things into perspective!
Human resource management is all about organizing and regulating the human resources of any company which includes appraisal performance, payroll, attendance and time, learning and lots more. So, it is a difficult task to maintain, therefore HR software is introduced to make programs work more effectively and accurately.