The recent trends show that human resource management (HRM) functions, procedures and practices are increasingly important, considering the impact of the knowledge-based economy. Whether it is a small or medium enterprise, human resource constitutes an important area of study.
The production process of goods and services is guaranteed by efficient and careful human resource management. It creates a satisfactory level of living in society. Human Resources can play an important role in realizing the objectives of the enterprise as an integral source. Effective and efficient Human Resource Management is the key to a successful organization.
The Purpose of HR Management
Strategic initiatives that can boost employee retention
Retention of Employees is a critical issue for companies to compete for talent in a tight economy. According to the Society for Human Resource Management (SHRM), the payoff organizations that focus on employee retention are well worth the time and investment.
Here are some strategies of increasing retention rates the organization should start, at the very beginning of the recruitment process:
HR and SMEs
The Small-Medium Enterprise (SME) sector plays a significant role in strengthening the country’s economic progress and international standing. Millions of jobs, promotion of industrial development in rural areas, production of a diverse variety of products with limited capital investments, is regulated and instrumented through the working of this sector.
The Ministry of SMEs estimated that 40% of manufacturing output, over 8% of the national GDP and much more job opportunities both in rural and urban parts of the country is contributed by SMEs. The survey conducted by the Confederation of Indian Industries states that 20% of medium and 80% of small-sized businesses have no HR department. It is shocking as, without a proper HR functioning department, implementation of various people related policies and the process is difficult.
HR is a key to digitize an organization through various procedural means. Organizations should develop a visionary mindset so that the importance of strategy and the process of managing human capital can be realized.
Tackling Common HR Problems Faced in SMEs
Here are some ways of tackling the most common HR Problems in SMEs:
HR Management challenges for SMEs
Along with cash flow, generating new business and marketing, there is a raft of challenges an HR can face in a small and medium enterprise (SME). These are some customary HR challenges that a small and medium business owner faces:
Despite the difficulties and problems faced by modern HR, small employers have options to overcome them. Outsourcing all or some HR problems is a quick and popular solution for business leaders wanting to focus on business growth. The important role of HR managers in SMEs can never be denied. As SMEs continue to grow, the need to recognize and address the challenges so that both SMEs and HR can work together to implement various desirable changes in the enterprise.