The Biggest HR Challenges Among Small Businesses & How to Face Them

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What are the biggest HR challenges facing your small business, and how will you handle them? A study by SHRM.org polled HR managers to pinpoint the biggest HR challenges they foresee in the next 10 years, and the results may help you hire and retain top talent. 

Top challenges cited? Retaining and rewarding top employees (59 percent), developing the next generation of leaders (52 percent) and creating a culture that attracts the best and the brightest (36 percent) Sound familiar?

How do companies plan to deal with these challenges? Providing flexible work arrangements (40 percent), creating a fair, open and trusting culture (37 percent), giving employees opportunities to advance in their careers (26 percent) and offering a higher total rewards package than competing employers do (26 percent) are the top strategies.

As a small business, you face some special challenges in using these tactics. Here’s how to make them work for you.

Flexible work arrangements: If you’re a holdout who still believes work-at-home days are goof-off days, you need to adjust your thinking to be competitive. Try offering limited work-at-home options, such as one day a week, and carefully monitoring results. Flextime is a nice middle ground: Requiring employees to come into the office, but letting them choose from a range of hours, can satisfy both employer and worker.

RELATED POST: Don’t Wait To Promote Your Company’s Work-Life Balance Perks! It May Be Your Best Recruiting Tool

Fair, open and trusting culture: In a small business, it’s much easier than in a big one to create an open culture & environment. But it’s still possible for rumors and misinformation to spread. Interact with employees daily and know what they’re saying so you can nip rumors in the bud. Share information that affects their lives—if they know you’re not hiding anything from them, they can relax and focus on work.

Opportunities for advancement: In a small company with few positions, promotions are sometimes hard to come by. If so, make sure you offer ways for employees to learn new skills, move laterally, job-share or cross train. Even perks such as attending industry conferences or events can help them advance their knowledge.

Higher total rewards: You may not be able to compete with big companies’ glamorous benefits packages. The word “total” is key here: Make sure you offer competitive wages, then sweeten the pot with the benefits that matter most to your team. This might include health insurance, retirement plans or life insurance, depending on their ages and life-stages. Also emphasize “soft” perks such as flexible hours. Consider offering performance-based bonuses or profit sharing. Finally, don’t discount the value of the many opportunities a small business offers for even entry-level workers to take a leadership role without climbing a corporate ladder.

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Author: Rieva Lesonsky

Small Business Maven

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