Your business needs to grow to become the solid, stable foundation on which you can build your life. Investing in HR early in your company's development is one of the best ways to ensure sustainable growth. Too many new businesses wait on HR investments because it seems to be a low priority, or take an ad hoc, DIY approach. It's easy to fall into the pattern of doing HR yourself, which can often create headaches and hurdles for your company.
However, investing in formal HR helps you find the necessary structural balance to build a stronger company.
HR Balances Your Business
Regardless of the type of business you run or your industry, all businesses are made of people. They function almost like living entities, with leadership being the brain. That makes human resources the nervous system, ensuring that information reaches all parts of your business and returns from it to leadership.
When properly conducted, HR reduces the phenomenon of "siloing," which separates people and departments, and helps to ensure uniformity and commonality between all departments and locations, building a balanced structure and a more cohesive organization.
How HR Grows Your Business
Furthermore, HR, directly and indirectly, supports the growth of your business in both the short and long term. HR ensures your business maintains legal compliance, helping you stay up-to-date with all existing laws and regulations to prevent any fines. A good HR department also:
Improves and Builds Internal Culture
You need an excellent internal culture. Your workplace should be one where your employees feel comfortable and supported, where conflict is kept to a minimum, diversity of ideas is valued, and everyone knows the goals they are working towards fulfilling. A primary function of HR is to determine what this culture should be and create strategies to work towards it.
Helps Businesses Plan Ahead
Another crucial HR function is putting the right people in the right places, not just for now but for the future. Too many businesses think only of immediate needs when hiring and training talent. A good HR department is already looking for the skills you will need for positions you have yet to create, helping your business move forward seamlessly and ensuring you are ready for what the future might bring.
Successful businesses can adapt as they grow, modifying and expanding their operation to handle more responsibilities—and more staff. The structural requirements of a business with five people are vastly different from that of 50, just as the requirements of a company making several hundred thousand dollars of revenue each year differ from one making several million dollars. Your HR department facilitates those adaptations, helping your business stay together and plan for your changing needs.
Hires and Nurtures Great Talent
Again, people make businesses what they are since they can't exist without them. Finding the right people for your company is always a challenge. Furthermore, once you have found them, you need to nurture them by providing a supportive environment, professional development opportunities, and ongoing challenges to help them grow. Great talent needs to be treated right, and if you plan correctly and hire and nurture the right people, you can increase your company by supporting and strengthening the people within it and ultimately filling critical roles with individuals you already know are the perfect fit.
Growing your talent requires nurturing and training your existing staff to take on new roles and responsibilities while bringing in external talent to fill roles you can't internally fill. That helps your business restructure and do so gradually, with little to interfere with your daily operations.
In addition to nurturing talent amongst your staff, you must also invest in leadership and management training. Whether you’re promoting existing staff into leadership roles or helping existing leaders continue to grow in their roles.
Reduces Turnover to Keep Talent in Your Organization
Once you have talent, you must ensure they stay within your organization. In today's world, many employees feel they have no choice but to change jobs every few years to progress in their careers. You can reduce turnover by providing training and professional development that optimizes productivity in their current role and supports their future goals. You want to train your staff to be able to work anywhere but provide benefits that make them want to stay. Training managers will also help reduce turnover related to poor management since people will leave due to bad bosses more than their job requirements.
Good HR staff will find out what your employees want and where they hope to be in their careers and provide them with the support they need to get there without having to leave. A good company culture breeds loyalty by improving satisfaction and helping employees feel you are loyal to them.
Maintains Your Team's Performance and Emotional Investment
Your HR department helps management develop performance systems to identify your highest—and lowest—performers. Understanding that helps you provide the proper support to enable employees to grow into their role and compensate them to encourage retention. You want your top performers to stay with your organization and continue to perform. However, you also want your lowest performers to receive the necessary training to improve in their role so they can become more productive. It also lets you see where problems persist to fully understand who you will need to let go from your organization.
Emotional investment is when you focus your emotions on something you hope will grow and sustain your well-being. You want your team members to emotionally invest in their jobs and your company's growth. HR helps with this by establishing whether people are becoming emotional shareholders, why they might not invest themselves or engage, and providing the support needed to maintain and strengthen these investments.
Find Support by Outsourcing HR
Creating solid internal HR systems is challenging for smaller and newer companies still developing. Even some more established companies can have issues with this.
Outsourcing HR, such as through a professional employer organization, gives you access to these structures without needing to build them yourself. It saves you time and energy that you can put into growing your business. When you have internal HR people, they can focus on strategic goals, hiring the best talent, and nurturing your company culture.
PEOs also have excellent knowledge and experience and can act as a resource for your business, for example, by helping you develop safety programs or providing guidance in implementing 401k plans.
HR is part of the foundation your company needs to grow and thrive. It should not be an afterthought or done ad hoc as it is how you hire, nurture, and retain the talent you need to build a thriving business. Outsourcing to a PEO is a great way to build the structures quickly you need to support your employees and business through excellent HR systems.