Human Resource Management In Small Business Pdf

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Human Resource Management In Small Business Pdf – Every organization, big or small, uses various capitals to run a business. Capital includes money, securities, or assets that are used to generate income for a business. For example, a retail store uses records and inventory, while a consulting firm may have software or buildings. Regardless of the industry, all companies have one thing in common: they must have people who put their capital to work for them. This will be our focus throughout the text: generating income using people’s skills and abilities.

Human Resource Management (HRM) is the process of recruiting, training, paying people, developing policies for them and developing strategies for retaining them. As a field, HRM has undergone many changes over the past twenty years, and is even more important in modern organizations. In the past, HRM meant processing payroll, sending birthday gifts to employees, organizing corporate events, and checking that forms are completed correctly; in other words, an administrative rather than a strategic role that is critical to the success of an organization. Jack Welch, former CEO of General Electric and management guru, summed up the new role of HR: “Get rid of the holidays, birthdays, and sign-up forms…Remember that HR is important in good times, HR is defined in bad times.” (Frash et al., 2010).

Human Resource Management In Small Business Pdf

Human Resource Management In Small Business Pdf

It should be noted here, at the very beginning of this text, that each manager has a specific function related to the management of human resources. Just because we don’t have a Human Resources Manager title doesn’t mean we don’t do all or at least some HR tasks. For example, most managers deal with employee compensation, motivation, and retention, making these aspects not only part of HR, but also part of management. Consequently, this book is equally important for those who want to be human resource managers and those who will manage a company.

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Have you ever had to work with the HR department at your job? How was the interaction? What was the department’s role in this particular organization?

Keep in mind that many HR functions are also tasks performed by other department heads, so this information is important regardless of your chosen career path. Most experts agree on seven main roles that HRM plays in organizations. They are described in the following sections.

You need people to complete tasks and work in the organization. Even with the most advanced machines, people are still needed. Therefore, one of the main tasks of HRM is the work of employees. Staffing covers the entire recruitment process, from posting a vacancy to negotiating a salary package. There are four main stages in the employee’s role:

Each organization has policies to ensure equity and continuity within the organization. One of the tasks of HRM is to develop the language associated with these policies. Policy development involves HR, management and leaders. For example, an HR professional will recognize the need for a policy or policy change, solicit feedback on a policy, draft a policy, and then communicate those policies to employees. It is important to note here that HR departments do not and cannot work alone. Everything they do must involve all the other departments of the organization. Examples of workplace policies include:

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These topics are covered in more detail in Chapter 6, Rewards and Benefits, Chapter 7, Retention and Motivation, Chapter 8, Learning and Development, and Chapter 9, Successful Employee Communication.

HR professionals must determine whether compensation is fair, in line with industry standards, and sufficient to motivate people to work for the organization. Compensation includes everything an employee receives for their work. In addition, HR professionals must ensure that the salary is comparable to other people doing similar work. This includes creating salary systems that take into account number of years with the organization, experience, education and the like. Examples of workers’ compensation benefits include:

Retention involves keeping and motivating employees in the organization. Compensation is the main driver of employee retention, but there are other factors as well. Ninety percent of employees leave the company for the following reasons:

Human Resource Management In Small Business Pdf

However, 90% of managers believe that employees leave because of pay (Rivenbark, 2010). As a result, managers often try to change their compensation packages to prevent people from leaving when compensation isn’t the reason they’re leaving. Chapter 7, Retention and Motivation, and Chapter 11, Employee Evaluation, discuss some of the best employee retention strategies based on these four factors.

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When we take the time to hire new employees, we want to ensure that they are not only trained to do the job, but that they continue to grow and develop new skills on the job. This results in higher productivity for the organization. Training is also a key component of employee motivation. Employees who feel they are developing their skills are more likely to be satisfied with their jobs, which leads to higher employee retention. Examples of tutorials may include:

We discuss each of these types of learning in more detail in Chapter 8, Learning and Development.

HR professionals must be aware of all workplace laws. The HR specialist may work with some of the following laws:

The HRM legal environment is constantly changing, so HRM must always be aware of the changes taking place and then communicate those changes throughout the management organization. Instead of presenting a chapter on HR laws, we will review those laws in each relevant chapter.

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Security is an important issue in every organization. Often, new laws are created to establish federal or state standards for worker safety. Unions and union agreements can also affect workers’ safety conditions in the workplace. The HR manager must be aware of employee protection requirements and ensure that the workplace meets federal and union standards. Employee protection issues may include:

We look at these issues in more detail in Chapter 12, Dealing with Trade Unions, and Chapter 13, Occupational Health and Safety.

Footnote: Knowledge of employee protection law is often the responsibility of the human resources department. In some industries, this is very important; in fact, it can mean life or death.

Human Resource Management In Small Business Pdf

In addition to these main functions, good communication skills and excellent management skills are essential for successful human resource management, as well as general management. We explore these issues in Chapter 9, Successful Employee Communication.

Human Resources Models Every Hr Practitioner Should Know

In addition to managing internal factors, the HR manager must consider external forces that may affect the organization. External forces or external factors are things that the company does not have direct control over; however, they can be things that can affect human resources positively or negatively. External factors include:

For example, the recent trend of flexible working (allowing employees to set their own hours) and telecommuting (allowing employees to work from home or remotely for a certain amount of time, for example one day a week) are external factors that have had an impact. HR. HRM must be aware of these external issues in order to develop policies that will respond not only to the needs of the company, but also to individuals. Another example is the Patient Protection and Affordable Care Act that was signed into law in 2010. Compliance with this law has significant implications for the human resources department. For example, a company with more than fifty employees must provide health insurance or pay a fine. 60 percent of employers now offer health insurance to their employees (Cappelli, 2010). As health insurance will become mandatory, cost issues, as well as the use of health benefits as a procurement strategy, are important external issues. Any manager who acts without regard to external forces is likely to alienate employees, resulting in demotivated and disaffected employees. Failure to understand external factors can also lead to breaking the law, which also has various consequences.

Understanding the key external factors is essential to being a successful HR professional. This allows strategic decisions to be made based on changes in the external environment. To develop this understanding, it is necessary to read several publications.

One of the ways managers learn about external forces is by attending conferences and reading various articles online. For example, the Society for Human Resource Management website, SHRM Online

Essential Hr Policies And Procedures

, not only posts job openings in the field, but also discusses many of today’s HR topics that can help managers make better decisions when managing people. In section 1.3, “Today’s Challenges in Human Resource Management”, we will look in more detail at some of the recent external issues affecting human resource management functions. In section 1.1.2 Role of HR, we will discuss some of the skills needed to be successful in HR.

Most experts agree that HR professionals perform seven main roles. All this must be taken into account

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