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A Model of Small Business HR Growth Management
Abstract
Substantial work has been undertaken in the field of human resource management (HRM) as it applies to large organizations. However, for small business these models frequently do not apply. The small business lacks adequate systems to ensure the efficient management of human resources. Further, most small businesses are the product of their owners, whose personality and personal involvement dominate. Drawing upon evidence from four case studies of small business owners who have experienced growth the aim of the paper is to examine the point at which these owners became aware of the need for team building and delegation within their companies and how they responded. All have found finding, motivating and retaining good staff a critical bottleneck in their business growth. Of importance, appears to be their beliefs, attitudes and values. A shift in these areas was necessary before change could be undertaken. The point of awareness for many came from the managerial training programs but was tempered by their beliefs and the growth cycles of their companies. Prior to change being possible these owner-managers needed to develop skills and competencies in leadership, coaching and management before effective delegation and team building could take place. These findings are linked to the existing body of knowledge relating to HRM. A theoretical model of the small business HR process for small business growth is presented. Future, implications for small business management and research are discussed.
... The owners of small firms are not prepared to give high salaries and incentives to their employees (Altinay et al., 2008). Mazzarol (2003) highlighted that the SMEs owner-manager is usually burdened with a variety of HR functions such as recruitment and selection, staff promotion and retention, wages and salary for which he or she is generally poorly equipped. In fact, Tocher and Rutherford (2009) commented that SME owners do not tend to focus on administrative issues such as HRM, until they perceive that such issues are critically important to the firms. ...
... In addition, Altinay et al. (2008) agreed that employee training and recruitment through formal channels contribute to the sales growth -1017 -| P a g e of small firms. Furthermore, Mazzarol(2003) asserted that the need for more formalized HR policies is likely to increase as the size of the firm grows because small firms sustainability in periods of growth can be more problematic. In addition, Barret and Mayson (2007) asserted that the formalization of HRM is dependent on the small firm owners' awareness of legislation and legal requirements on HRM and employment matters. ...
... This supports earlier findings that indicate that the HR function among manufacturing SMEs is still largely underdeveloped. The results also conform to the findings of Mazzarol (2003) who found that the HR function among SMEs tend to be informal and the SMEs owner-manager is usually burdened with a variety of HR functions such as recruitment and selection, staff promotion and retention, wages and salary for which he or she is generally poorly equipped. ...
... The study investigates how these practices are used in small-and medium-sized enterprises (SMMEs) in conjunction with strategic business strategies. Research indicates that the practices of HRs in SMMEs are not well documented (Cardon & Steven, 2004;Dun Bradstreet, 2001;Gilman & Edwards, 2008;Mazzarol, 2003). ...
Orientation: Small, medium and micro enterprises (SMMEs) are prone to failure primarily because of inadequate human resource (HR) procedures despite their reputation for flexibility, closeness to dependable clients, adaptability and adoption of new technologies.Research purpose: This study aims to explore strategic human resources management (SHRM) strategies for small businesses in South Africa to enhance survival rates. It investigates the pivotal role of HR in SMMEs, emphasising effective selection, recruitment, retention, and performance management for productivity and competitive advantage. Additionally, it elucidates the impact of SHRM practices on organisational efficacy and assesses the correlation between performance and training.Motivation for the study: The goals of SMMEs are to manage relationships, perform better and boost employee satisfaction through the effective use of HRs. This study’s interpretation of human resources management (HRM) is that it should be used to improve resource efficiency by applying HRM techniques. Further, performance management is another method that HRM shows up.Research approach/design and method: A desktop research on a PhD thesis published in 2014 used a positivist paradigm, descriptive research design, quantitative research approach and a survey research strategy, which included 50 respondents and was conducted in Polokwane in South Africa. The simple random probability sampling method employed a saturated sample technique as well as descriptive and path analytic tools.Main findings: The findings revealed that: (1) the results portray strong evidence between organisational capabilities (skills, knowledge) and organisational effectiveness and (2) business skills affect SMMEs’ profitability in South Africa.Practical/managerial implications: Through the advancement of a Resource-Based Entrepreneurship Theory (RBET), the study added to the body of knowledge.Contribution/value-add: This study makes a compelling case for the necessity of HRM procedures for the organisational efficacy of SMMEs.
... More importantly, small businesses are the product of their owners; hence their personal involvement and personality dominate the business. According to research Small business key for success is retaining good staff and motivation [16], and like all businesses have importance to attitudes, beliefs and values. Effective management of small business growth needs commitment from the owner to have policies, structure and practices which enable employees to take greater responsibilities and have to participate in dynamic innovative teams. ...
In the wake of the COVID-19 pandemic, small businesses worldwide have faced unprecedented challenges. This study presents a detailed analysis of these challenges and explores the effectiveness of government interventions in supporting small business recovery. Utilizing a mix of quantitative research methods, including statistical analysis and a comprehensive literature review, the research focuses on the specific impacts of the pandemic on small business operations and finances. Key findings indicate that small businesses have suffered significant disruptions, primarily in supply chain management and customer engagement. The study evaluates various government initiatives, such as financial aid packages and regulatory relaxations, highlighting their role in mitigating the pandemic's adverse effects. Furthermore, it proposes a set of recommendations for both government and small businesses, emphasizing the need for tailored financial support, enhanced digital transformation strategies, and flexible operational adjustments. The research concludes that a collaborative approach between government and small businesses is essential for ensuring sustainable growth and recovery in the post-pandemic era. This study contributes to the existing body of knowledge by providing actionable insights and practical strategies for policymakers and business owners, aiming to bolster the resilience and long-term prosperity of small businesses, which are integral to the global economy.
... We are simultaneously mindful of the idea that hiring the right employees can be an arduous process, especially for entrepreneurial ventures suffering from liabilities of newness (Stinchcombe 1965) and smallness (Freeman, Carroll, and Hannan 1983). For instance, Mazzarol (2003) demonstrated that finding, motivating, and retaining employees can be a critical bottleneck to business growth. Future studies should investigate employee characteristics and fit with founder characteristics, mission and vision of the entrepreneurial firm, and commitment to assess the potential benefit of hiring employees with and without such fit. ...
Entrepreneurs can benefit from having non-work experiences that help them recover the psychological resources depleted from work tasks. Using the Effort-Recovery Model as a basis for understanding how recovery occurs, this study examines relationships between non-work recovery experiences (i.e. psychological detachment, relaxation, mastery, and control) and well-being (i.e. work engagement, emotional exhaustion, and sleep quality) in entrepreneurs, a unique sample population for studying the relationships between these constructs. We test hypotheses using a cross-sectional survey of 247 early-stage entrepreneurs that founded a business in the prior three years. Findings show that mastery and control experiences have a positive relationship with work engagement, control experiences have a negative relationship with emotional exhaustion, and psychological detachment experiences have a positive relationship with sleep quality. The results also suggest that higher work hours are related to lower relaxation and control experiences, whereas a higher number of employees is related to higher relaxation experiences and feelings of control over non-work time. Comparing these results to studies with employees, one implication is that low psychological detachment may be less harmful in the short-term for early-stage entrepreneurs. A second implication is that there are benefits of multiple after-work recovery experiences (i.e. psychological detachment, mastery, and control).
... İşletmeler, gelecekteki hareket tarzına karar vermek ve işletmenin zor zamanlardan mümkün olan en kısa sürede çıkmasına yardımcı olacak stratejiler geliştirmek için kriz yönetimi ekibi oluşturmaktadır. Krizin uyarı sinyallerine anında müdahale etmek ve acil durumların üstesinden gelmek için ilgili planları yürütmek üzere Kriz Yönetim Ekibi oluşturulmalıdır (Pollard & Hotho, 2006 (Mazzarol, 2003). ...
Mevcut ekonomik ortamda, işletmeler ve kuruluşlar küresel ve yerel ekonomilerde krizle başa çıkmakta zorluk çekmektedir. Rekabet gücünü korumak için, bir işletme maliyetleri en aza indirmeli, gelirlerini en üst düzeye çıkararak kaynak akışlarını yönetmelidir. Burada hem geçici hem de örgütsel ve ayrıca işletme sırasında meydana gelen maddi kayıplardan bahsediyoruz. Azerbaycan için yeni piyasa koşullarında örgütsel yönetim sisteminin iyileştirilmesi, petrol üretim işletmelerinde iş süreçlerinin geliştirilmesinin etkinliğinin yönetimine yüksek talepler getirmektedir. İşletmelerin rekabet gücü esas olarak doğru iş süreci yönetimi stratejisi seçimine bağlıdır. Petrol endüstrisi, altyapının düzenlenmesi için iş süreçlerinin geliştirilmesinde hala geride kalıyor ve sonuç olarak ekonominin önemli olan temel üretim için teknolojik ve lojistik destek organizasyonunda gerekli çalışmaları yok. yüksek üretim maliyetlerinin nedenleri. Pazar ilişkilerinin yeni koşullarında, altyapı iş süreci yönetiminin organizasyonu ve optimizasyonu ile ilgili sorunlar daha da şiddetli hale geldi. Çalışmanın amacı, işletmenin altyapı sisteminde etkili bir iş süreci geliştirme organizasyonunun oluşturulması için teorik hükümleri ve pratik önerileri doğrulamaktır
In this chapter we present findings from a project that offered HR support to small firms adopting the discourse of strategic human resource management (SHRM), which posits that progressive HR practice can improve firm performance. We explore how HR support can address both HR content and process, offering advice to owner-managers in the absence of an HR specialist. While uptake of support can be limited, we demonstrate its potentially positive effects on HR practice and, tentatively, performance. We suggest that SHRM is possible in small firms. We argue that bespoke, specialist HR support can be highly effective and that policy-makers should seek to make this available and address the barriers to accessing it.
Purpose
This study examines the relationship between small-firm managers' propensity to participate in a growth-oriented training program and their subsequent program outcome in terms of strategic reorientation. From a policy perspective, this relates to the important question of what benefit would come from recruiting managers who are normally not easily recruitable for training programs.
Design/methodology/approach
A control group design including pre- and post-training surveys is used to assess the effects of a large-scale management training program. Accounting for selection bias, the difference-in-difference method, together with propensity score matching, was applied to assess average program effects. The matching-smoothing method was used to assess heterogeneity in program effects associated with participation propensity.
Findings
Overall, program participation associated positively with change in strategic orientations. This effect was especially pronounced for managers with either low or medium to high inclinations for program enrollment, while diminishing in the modest to medium range.
Practical implications
The findings have important practical implications for selection of target groups and recruitment strategies in relation to small-firm management training programs. From the results, recruitment strategies may effectively include managers with either high or low participation propensities, rather than aiming to “fill up” with managers with moderately low participation propensity.
Originality/value
Several extant studies have examined average treatment effects from small-firm training programs. Yet there has been a lack of examination of the extent to which participation propensity modifies the effect of training on outcomes. This study brings new knowledge of the direction and magnitude of such heterogeneous training effects.
This chapter presents an overview and evaluation of the existing research on the unique case of Human Resource Management (HRM) approaches, practices, and nuances within the context of small and medium enterprises. These debates are assessed within the context of varying country definitions of small and medium enterprises, in comparison with human resources within the typical large-firm literature. For decades, practitioners have assumed that the same HR strategies used within large firms can be used the same way within smaller businesses. Most management and training provided to smaller businesses have largely been based on the formal management practices used within larger firms. However, small and medium businesses are not larger firms, since they experience ‘resource poverty,’ which requires different management approaches, practices, and principles. Indeed, smaller businesses are not little big businesses. Unique characteristics and several factors influence the type of HRM practices used within small and medium enterprises. Therefore, small/medium businesses and larger firms may not be able to use the same formal practices in the same way due to nuances unique to smaller entities. The emerging research in these areas is investigated, and gaps are outlined.
The relevance of the study is conditioned by the fact that despite the variety of issues, the focus of personnel management is on a person who is considered a spe-cial element of the organisation, an entity with a unique resource of widely under-stood capabilities and needs. Their specific location, with proper management, creates the value of the organisation and determines its competitiveness. Age management is defined as an element of human resource management or an ele-ment of management of a wider variety, which consists in the implementation of measures that allow for a more rational use of human resources in agricultural en-terprises, by considering the needs and capabilities of employees of any age. The purpose of the study is to consider the problems of personnel management and labour resources in the agricultural sector of Ukraine in 2000-2020. To achieve this goal, the following methods were used: strategic, holistic, and organisational. Ef-fective personnel management can, among other things, contribute to improving the efficiency of the company, reducing the cost of human resource management, growth and competitiveness, and maintaining a good or improved image. It is very difficult to clearly determine the time at which the ageing process begins. The breakdown by chronological age is not suitable for employees to perform various professional roles. Often, when a person's life lengthens, the period of their effec-tive functioning also increases without those limiting qualities attributed to old age. The changing abilities of a person to perform work are mainly caused by a de-crease in physical performance and fitness, and some psychophysical skills. The task of the personnel and labour resources system is, first of all, to increase the ef-ficiency of the tasks performed by individual employees, to improve the organisa-tion's potential through a detailed definition of training and development needs, to support the personnel decision-making process and the development of personnel policy. The practical significance lies in the productive construction of personnel management and labour resources in the agricultural sector, due to the allocation of relevant problems of the sphere under consideration in Ukraine in 2000-2020.
A qualitative assessment is used to identify and describe the “gaps” between concerns entrepreneurs have about human resource management issues in growing small and medium-sized enterprises (SMEs) and the topics emphasized in the research literature on human resource practices in SMEs. Survey data from 156 young entrepreneurs, focus group data from 173 CEO/founders of fast-growth entrepreneurial firms, and 129 research articles were reviewed. Results revealed gaps and omissions in the literature, Including the importance to entrepreneurs of developing high-potential employees that can perform multiple roles under various stages of organizational growth and the matching of people to the organizational culture. Recommended perspectives for future research are identified.
Activities of a group of small firms were studied over a six-year period to determine the manner In which their performance reflected the results of a counseling program. The effects of counseling In a number of functional areas were explored. Findings of the Investigation suggest that while adequate attention to marketing, financial, and technological matters Is essential, firms that Ignore the requirements of sound human resource management may fall to remain competitive.
A survey of small business firms In North-Central Indiana Indicated that, while these firms provided a work place and an Income to employees, most of their practices on compensation and maintenance of human resources lacked a systematic and rational approach. Their emphasis appeared to be more on the short run rather than on the long run. Further, small businesses seemed to lack an understanding of the relationship between productivity and generally accepted human resource management practices. In the absence of clear, written policies on human resource maintenance and compensation, small firms will continue to have personnel-related problems. Further research needs In this area are suggested.
Recruiting new employees is one of the biggest challenges facing small businesses, and a key component of organizational success. Unfortunately, existing human resource literature has almost entirely focused on medium and large firms. In addition, past recruitment research has neglected the possible influence of institutional forces on organizational recruitment success. This paper attempts to address these potential gaps in the literature by utilizing institutional theory to develop a strategic model of small business recruitment.
The need to understand and manage change is salient, particularly for mature firms where the long-established norms of stability and security must be replaced with new values such as speed, simplicity, unparalleled customer service, and a self-confident, empowered workforce. The purpose of this article is to explore how mature firms can be re-energized. To do this, this article describes the unique challenges of creating change in mature firms, detail principles that can be used to guide change, and identify the leadership and work activities required to accomplish change.