How to create a culture of HR excellence

Congratulations to Fittleworth Medical Ltd who scooped the People Management award for SME HR initiative of the year at a ceremony at the London Hilton Tuesday night.

The award, which is sponsored by Cezanne HR, recognises the key role good HR practice can play in supporting small business growth.

Fittleworth (a home delivery company for wound care products) impressed the judges with its ground-breaking initiative to define the culture and values of the business following a period of rapid expansion.

‘The Fittleworth Way’, which was developed with input from all staff, is now firmly embedded in the business and underpins and celebrates the great things employees do every day.  The company is now planning to develop an internally-accredited training programme for care centre and customer service staff, based on the work of the project.

It’s a great example of the impact creative HR can have on the success of an SME and the way people feel about their employer.  So what can you do to push people management practices forward and create a culture of HR excellence?

 Win the support of the CEO

Business owners know they have ‘to do HR’, but they don’t always appreciate the benefits a strategic approach to HR can bring to the bottom line.  Getting the MD to see HR as an enabler and driver of growth – rather than just another business overhead – can be a real challenge, especially in the heady, early days of an SME when the focus is on growth and getting the goods or services out of the door.    If you are to gain the confidence of the CEO, you need to show a clear understanding of the challenges the business is facing and to be able to demonstrate how people processes can support the strategic direction.  Having up-to-date people data at your fingertips can help you greatly improve your influence with the leadership team.  If they can see your HR processes are providing them with information to support strategic decisions (on areas like skills needs and recruitment for example) they are much more likely to develop respect for the role HR can play in taking the business forward.

Know what stage the business is at

Recent research from the CIPD identifies four clear stages of growth SMEs typically go through and pinpoints the HR opportunities and challenges that are likely to arise at each stage.  The key to success is to identify what stage of transition your business is at and assess whether your current people management approach is delivering what the business needs.  In the early days, for example, SMEs still have what the CIPD defines as ‘entrepreneurial edge’.  They are typically informal with fluid structures, flexible job roles and often no formal HR person or department.  As the business becomes an ‘emerging enterprise’, it tends to adopt a slightly more formal approach.  Some policies and processes are put in place, but the business still tends to be reactive rather than strategic in its approach to things like recruitment.  The next stage is ‘consolidating organisation’ where the business strategy is planned rather than emergent and there are typically more layers of management.  In the final stage, ‘established organisation’, HR needs to become more forward-looking in order to set the business up for long term success.  Ask yourself what stage you are at – and whether your current HR approach fits the bill?

Support don’t stifle

As the business grows, there comes a point where knee-jerk reactions are no longer appropriate and policies and processes have to be put in place, for the sake of both efficiency and legal compliance.  It’s important, however, to make sure that the systems you introduce don’t inadvertently stifle innovation or make people’s lives more difficult.  The key is to try and streamline people management processes and make it easy for managers to lead their teams – rather than introduce systems which are prescriptive and overly-bureaucratic.  Technology can do much to help in this respect.  Automating absence and annual leave processes, for example, can take time-consuming admin away from line managers so they can concentrate on developing new products and services and meeting customer needs.

Continually Develop expertise

Many of those responsible for HR in SMEs don’t come from a people management background.  HR is often something that gets tagged onto their main role in the early days and then over time becomes the ‘day job’ as the business grows and staff numbers increase.  Even those who have come from an HR background can sometimes feel isolated and out-of-touch with the latest thinking.   As the only people practitioner in the business they have no-one to discuss difficult issues or new ideas with.   Keeping up with current practice is vital if HR is to become a vibrant, influential part of the business.  Make sure you understand the market your business is operating in and what challenges it is likely to face going forward.  Network with other SMEs to find out how they are approaching common HR issues and take an active part in your local CIPD group to make sure you are aware of the latest research and best practice.

Embrace technology

In the early days of an SME, it’s quite common for employee data to be managed across a series of Excel spreadsheets which get passed around the business between managers.  As the business grows, however, there comes a point where this is no longer viable.   No-one knows who has the latest version and there’s a danger that data security can be compromised. Moving to an automated HR solution may seem a terrifying prospect at first, but you will soon find that getting to grips with technology is a liberating experience which will free you from time-consuming admin and allow you to concentrate on the more strategic aspects of your role.  The latest generation HR software can not only streamline absence and performance management processes, it also has the capability to re-energise communication, make people feel valued and drive creativity and innovation within teams.  HR systems are also a rich mine of information which the business can use to spot trends (such as rising absence levels for example), identify skills gaps and inform key strategic decisions.

The CIPD has a useful tool for those with responsibility for people management within SMEs.  It includes an organisational stock-take, practical exercises, action planning tools and case study examples to help you take your HR practice to the next level https://www.cipd.co.uk/hr-resources/practical-tools/achieving-performance-hr-sme.aspx

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