SMEs need to leverage HR

There is huge business value that can be unlocked by SMEs that apply business-related HR practices to develop and manage their staff.

"In my personal experience, SMEs are currently only leveraging about 30% of their employees` potential to the benefit of their organisations," says Dianna Kerruish, recently appointed HR executive at The People Business (TPB) group of companies.

Kerruish has 10 years` experience in the HR industry, including consulting to SMEs and managing growth dynamics. She will head up TPB`s HR division, which boasts a client base of SMEs, large corporates and multinationals in the healthcare, IT and manufacturing sectors, among others.

"The SME sector in SA has grown significantly and our new focus on this segment is driven by an understanding of prevailing market dynamics with relation to the parallel development of people and organisations. TPB`s experience in this industry allows us to distil, scale and apply proven HR practices and systems suitable to the growing SME organisation.

"Among our goals is changing the perception among SMEs that the current HR legislation - the Employment Equity Act, Skills Act and Labour Act - is stifling. Clarifying the stipulations will allow these companies to better leverage legal requirements to the advantage of their business.

"SMEs can and should benefit from strategic inputs, developments and tools available in the HR field that have traditionally been the territory of large organisations. For optimum results, SMEs should address HR issues while their business is still malleable. Entrenching a productive and responsible corporate culture before pirate cultures have a chance to establish themselves, significantly increases the return on human capital investment and sets the stage for long-term growth.

"The deadline for employment equity submissions was 1 October and annual training reports will soon need to be put forward by companies," notes Kerruish. "SMEs need to create the foundation that will allow them to get better mileage from these efforts to meet legislative requirements. That foundation, if carefully planned and directed, can yield effective organisational development strategies, performance and remuneration strategies.

"Too often, where there is some investment in HR, the emphasis is too heavily laid on people development and organisational development is not factored in, nor is there any communication of set objectives to employees. TPB`s differentiation is its combined focus on both the employee and the employer`s requirements, and aligning HR strategies and systems to the benefit of both parties.

"Today, a measurable return on investment can be calculated into all HR development plans and the roll-out of HR systems. To fully utilise the skills at their disposal, SMEs need to put the systems in place that will support the development of staff and ensure behaviours and actions are aligned with business objectives, so better managing their existing and future risks and actively encouraging growth."