What is HR and does your small business need it yet?

13 February, 2020 · 5 min read

More than a few of us have made an off-colour joke at after-work drinks, clapped a hand over our mouths and said in a hushed tone, ‘Don’t tell HR!’ But besides hiring, firing and policing the odd behavioural slip-up, what do HR professionals actually do – and does your small business need them?

The short answer is yes, but not necessarily in the way you might assume. We talked to Claire Baker, CEO of Claire Baker Boutique HR Consulting, who specialises in helping technical, professional, and creative service based businesses either experiencing or expecting growth.

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Humans are human, not resources 

According to Claire, HR’s image is outdated. “Human resources means exactly that – anything that's linked to people. That's what I tell CEOs – you're dealing with human beings, not job titles. I don't even like the term ‘HR’. Humans are humans, not resources. So how I define it is, anything to do with the emotional, physical and mental wellbeing of people in the workplace. And that spans a lot of areas, from pay to benefits to training. I think that the stereotype of the ‘HR department’ actually scares small businesses, so that's why I talk about culture and productivity instead of HR.”

Start from the start of your start up 

When businesses begin, they rarely have a pressing need for a full HR department. But that doesn’t mean one shouldn’t plan for a future growth to the point where you have so many employees, you need a full department to take care of their needs. And it’s never too soon to start future proofing your business. “Some small businesses grow fast and are taken by surprise because they hadn’t planned for that.” Claire agrees. “Whereas some people anticipate growth and put things in place accordingly. That’s the right way, so you don’t get overwhelmed.”

Why you might delay or outsource HR (and why you shouldn’t)

When you start a business, you quickly get used to doing everything by yourself, and it can seem counterintuitive to pay someone to do something that you’re sure you can figure out – it’s just hiring and firing right? Or perhaps you understand that HR is important for helping grow your company in the right culture, but you don’t have the time to hammer out the details?
That’s where you might choose to outsource HR. It’s a valid option, but limits the scope of what HR can do. An external HR company may not truly understand your brand tone and values, whereas an in-house department or a boutique HR consultant actively helps to create them. 

Says Claire: “Bespoke HR can bridge between how people organise, lead, co-operate and communicate today, and where they need to be to avoid the fires and even infernos which cause barriers for success in the future.”

No one size fits all when it comes to employees

The best way to approach hiring is to find out what your employees really want. Yes, it’s more research than you may like, but if you want your people to do their best work, you need to remember they’re individuals with individual needs. For example, if you want to lure a high flier away from a job to come and work for you, they already have a good salary, so perhaps something else is important to them. Let’s say they’re a new dad – would he really appreciate a gym membership, or would extended paternity leave suit him more? You won’t know until you ask. 

Why not have potential and existing employees fill out a survey that lets them outline their ideal employment package? Then you’ve got some data to work with. 

You’re not an expert so don’t cut corners

A big mistake is assuming that if something saves money, it’s a good idea, and that’s just as true of HR expertise as it is for the quality of your office furniture (if not more). And of course, it’s natural to try and save money – nobody wants to pay for someone to audit their company. But as the old saying goes, you have to spend money to make money and nothing worth having comes for free. If you don’t have things in place regarding employees, you could incur much worse costs down the line. 

And don’t forget, having an outside voice weighing in on your business is very useful; it always helps to bounce ideas and thoughts off an expert. The truth is, it’s no different to having an accountant or a lawyer in-house.

And finally, some HR pro tips from Claire to get you started:

  • If you don’t yet have employees, ask everyone in your network what they do to keep their employees happy. You’ll get some great ideas.
  • Find out what your employees are motivated by – you’ll be surprised to learn that it’s not all about money.
  • Tailor packages to suit individuals. Some may want flexible hours, some may want gym membership, some may want a local creche discount, and some might be happy with just regular free fruit as their benefits! 
  • It’s never too early to start thinking about future staff and their future needs. Do it early and it could save you from employee-related pitfalls like forgetting to cap compensation levels (in case of disputes or provision for mental health etc.) or  down the line
  • Treat your employees in line with your brand values and you can’t go wrong. And don’t forget, part of HR’s remit is to help you design those brand values.
  • Remember the three magic words: Leadership. Trust. Communication. If you get those right, your staff will be happy – even when things are rough.

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