Small and mid-sized businesses (SMBs) are encountering substantial human resources challenges, as detailed in a new study by HR.com's HR Research Institute in collaboration with UKG. The research, titled "HR Decision-Making in Small to Mid-Sized Businesses," sheds light on the difficulties these organizations face, particularly in talent retention, fostering a positive company culture, and recruiting skilled employees. With 60% of HR professionals in SMBs identifying talent retention as their primary concern, the study underscores the competitive pressures these businesses face against larger corporations with more resources.
The study also points out a notable gap in the focus on employee reskilling and upskilling, with only 35% of SMBs considering it a major concern. This is despite the increasing emphasis on continuous learning and development in the workforce. Differences in HR maturity levels among SMBs further influence their priorities, with more advanced HR operations focusing on managerial skills and quality hiring, while less mature operations concentrate on compliance and basic HR functions.
Technology emerges as a pivotal factor in addressing these HR challenges. SMBs with more sophisticated human capital management practices are more likely to utilize HR technology at strategic and advanced levels. Julie Develin of UKG highlights the significance of HR technology for SMBs, stating its role in enabling strategic thinking and scaling businesses effectively. The research suggests that aligning HR technology investments with business goals can enhance decision-making and organizational success.
For SMBs looking to navigate these challenges, the study offers actionable strategies, including the adoption of strategic HR approaches and investments in effective HR technology. The full research report, available for download at https://web.hr.com/9lxj, provides further insights and recommendations. Debbie McGrath of HR.com emphasizes the transformative potential of strategic HR investments for SMBs, advocating for intentional strategies in HR processes and technology to overcome challenges and succeed in a competitive environment.
As SMBs continue to compete for talent and resources, the findings from this study offer valuable guidance for enhancing HR performance and achieving organizational success. By prioritizing areas such as talent retention, company culture, and the strategic use of HR technology, SMBs can address their HR challenges more effectively and position themselves for growth in the evolving business landscape.
