Following on from the #ORBMember example who featured in our last blog; Harris Global – a recruitment agency doing the right-thing, treating their employees with simple humanity and ethics leading to a massive fall in employee churn rate and therefore a big boost to the business’ profitability, reputation and sustainability – we’re continuing the theme of “People” in the three-pillars of ethical biz (Profit, People, Planet):
For many SMEs, the best, most available and most impactful thing they can do is be the best employer they can be; developing the individuals in their organisation, improving the lives of those they know best. It’s one of the “best” ways an SME can measure the return-on-investment of being more ethical and responsible (not least because you can see the smiles on your employees faces when they enjoy working for you!)
But for many SME’s attracting the right people and keeping them whilst also staying within all the legal red-tape can feel very, very daunting and utterly personal. Frankly it can be painful!
As ORB Member Ian Cass, Managing Director at The Forum of Private Business (FPB) says: “…we ran some research within our membership, the vast majority of whom, 95% employ between 1 and 50 people with the average being 12 employees, and of these 96% of respondents saw the benefit of and wanted to improve the level of training for their employees. But the main barrier quoted for not providing training or more training was cost. We wanted to look at this a little more closely and so we ran some more detailed research off the back of the original research, it highlighted how much free and reasonably priced training there was available, but many small businesses were unaware of this.”
“The perception was that training was expensive and they didn’t have much time in their already busy lives to look at this in any detail, so actually one of the key problems was education. Education of the small business community, so they needed information on what courses were out there, what was free and what the actual costs were”
So how best to approach this very important issue?
We’ve got a guest-blog from #ORBMember Vishal Handa, a passionate people-person who owns Success by Insight, (SBI) an agency that helps SMEs to not only solve but excel at keeping their people happy and productive. Vishal is an expert in the particular anxieties that SMEs have on recruiting and developing people, and how it is possible to tackle this pain-point without too much (unreasonable) cost vs. the return on the investment that can be achieved:
Small businesses employ around 60% of the workforce according to UK Government statistics. This presents those of us in this dynamic, vital SME sector with both an exciting opportunity and responsibility when it comes to recruiting, training and retaining staff. The wellbeing of the country is heavily dependent upon SMEs and how they are run. The way we treat current and future staff is crucial.
In this article, we will focus on two key challenges: Training and Development and Hiring. Here at SBI – Success By Insight – we often see how these concern SMEs in particular.
Challenge 1 – Effective Recruitment
- – As per The Chartered Institute of Personnel and Development (CIPD), the total cost of poor hiring is between four and six times the employee’s salary.
- -The Future Foundation puts the annual cost of managing poor recruits at £12 billion. This disproportionately effects SMEs.
- – Nearly 75% of firms say bad hires negatively impacted their business – not recruiting the “right fit” and the quantitative (revenue) and qualitative (cultural) shocks are worse for SMEs given the smaller staff base. Every employee makes more of an impact!
- – Approximately 50% of all new joiners leave their position within 12 to 18 months; a significant waste of time, money and resources.
Challenge 2 – Training/Development
A recent comprehensive report by the Federation of Small Businesses (FSB) found:
- – 91% of small businesses recognise the importance of training and development, both in increasing employees’ contribution to the bottom-line and staff retention, but only 43% invest in it (often inadequately).
- – Cost was the primary factor cited by 45% for not providing training. This is a false economy; by investing in employees, they become more productive, engaged and feel a greater sense of loyalty.
- – 25% of small businesses invested in general management and leadership coaching and training last year. Whilst this number has increased, SMEs are still “missing a trick”; investing in people can ensure consistent, sustainable business growth, especially during times of economic uncertainty.
Why Invest in Coaching, Training and Recruitment?
Simple! For these multiple benefits:
- – Productivity
- – Effective Teamworking
- – Profitability
- – Fewer Disputes
- – Motivation, Job Satisfaction
- – Better Risk Control
- – Improved Morale, Culture
- – Lower Costs (legal, recruitment etc.)
- – Staff Retention, Loyalty
- – Optimal Management
- – Attract New Talent
- – Enhanced Reputation – internal & external
- – “Better Fit” Employees
- – Business Resilience – during challenging times
The SBI Difference: We focus on your most important asset – your people.
Our flexible, cost-effective packages are specifically for smaller businesses – it takes one to know one! Our recruitment and advisory services offer more than typical agencies and for less; we do not simply forward CVs, we guide you, audit your hiring processes and offer value-add services as standard. For firms with existing agency suppliers or internal HR capacity, we provide complementary services that will not impact upon your existing relationships whilst still ensuring you find the “right people”. We can also coach and train you and your staff to work more productively and effectively through our range of coaching and skills training programmes. We appreciate SME budget constraints and apply the knowledge and experience gained from assisting both global organisations and smaller firms to best effect. Furthermore, we also provide redundancy, psychometric and values consulting services for individuals, teams and organisations.
If you have any questions, about this article then do get in touch with us at ORB, or of course do speak to Vishal and his team about a free, no-obligation conversation or meeting. Vishal is available here: email@example.com +44 (0) 7710 143 175