Does your company need dedicated HR support? It depends
Human Resources iStock photo
With Malaika T. Edwards
Business owners often question whether they need HR support since they are not large corporations and may not have many employees. This is a reasonable question. The answer, however, is not a simple yes or no. The need for a Human Resources Department, or any kind of HR support, depends upon different factors.
As a small business owner, once you have started to hire employees you will have HR needs. For some businesses, these needs may only include occasional support. In this instance, business owners may liaise with a consultant to provide ad hoc project-related services. For other businesses, HR support will be needed on a more dedicated basis. In this instance, business owners may need an in-house HR department, or may need to outsource the HR function.
Although there is no fixed rule of thumb to determine when HR support will be needed, there are some factors that should be considered to determine readiness.
- If business owners find themselves constantly engaging in HR-related activities and not having time to focus on core business functions, it may be time to get HR support. As a business owner, it is important to consider what your time is worth to the business and how time spent away from core activities impacts revenue growth and profitability.
- If business owners are assigning HR duties to employees which limits the time they can spend on their jobs and impacts their overall productivity, it may be time to get dedicated HR support.
- If business owners are not knowledgeable about the legalities surrounding employment and the country’s labour laws - such as those related to vacation leave, overtime pay and termination - there is a definite need for HR support.
- When the business is impacted by turnover and the loss of technical skills, HR support must be considered. Employees leave jobs for several reasons, such as inconsistent company policies and conflicts with colleagues. HR can mitigate against these challenges. Business owners must assess the costs associated with turnover and should recognize that HR support can prevent the adverse impact of turnover on the business.
- As the business grows and more employees are hired, there will be need for a ‘middle-man’ between business owners and employees, who can provide support to both parties. At this stage, business owners must also consider sourcing HR support, and must consider the level of support needed relative to the number of employees.
As the business grows it is important for owners to transition from doing all roles themselves as they did in the startup phase, and to move towards having dedicated HR support. Although the HR needs of businesses will vary, it is important to recognize that these needs exist, and a HR specialist will be required to manage them.
Malaika T. Edwards, PhD provides HR advisory services to business owners and individual clients. She is also an academic in the Higher Education landscape. You can contact her on LinkedIn at linkedin.com/in/malaika-edwards or by email at firstname.lastname@example.org.