The Modern Roles of HR in SMEs

The skills required to manage people have become more complex as we progress in the new knowledge economy. The relatively higher educational level of today’s employees, the fluidity of market demand, the mindset of a generation fuelled by vast amount of information, the evolution of technology; these are some reasons that make the task of people management ever more complex.

The question is: where does this lead HR to, especially in the small and medium enterprises (SMEs) landscape? We sum up from our research four modern roles where HR is expected – and is able to add value to the organisation, which also challenge the traditional notion that HR is purely administrative.

1. Leveraging on strengths.

Every organisation has its valuable strengths which it must realise and make full use of. The preferred management approach is always about solving the problems that an organisation faces; however this often causes the organisation to overlook its underlying strengths that runs its business well. In any situation, a modern HR practitioner must always ask for what works best, and then consider how to use the hidden potential fully. While pay might be a limiting factor for local SMEs, the latest Singapore’s National Workplace Happiness Survey (2014) result suggested that SMEs can focus on strengths such as developing a purposeful brand and expanding learning opportunities for their people.

2. Preparing the organisation for the future.

There is no better division than HR to make an organisation future-ready and future-proof. We are now plugged into a global competitive landscape, which forces organisations to grapple with the various effects of change. It is in this aspect that HR plays a vital role in not only becoming a change agent itself, but also creating the awareness and culminating an appetite that welcomes change amongst its workforce. In it, HR needs to build the necessary structure to make the organisation more resilient and innovative. This structure will allow the organisation to scale up and adapt to changes more easily instead of holding an SME back from its growth plans.

3. Making use of people analytics.

HR can be more influential at the management roundtable if they are able to furnish the leaders with people-related metrics that guide decision-making. While many traditional HR projects make people feel good, it lacks the science and numbers to support its running vis-à-vis other projects. People analytics can also shed light onto past trends and records that are instrumental to HR planning. The analytics can be in the form of employee surveys, diagnostic tests, or performance analytics. The leaders of SMEs tend to feel that people analytics has no real implication to their bottom line. The opposite is true; with their limited resources, it is crucial for SMEs to target the right area of talent engagement or development, which is often instrumental in bringing the organisation to the next level.

4. Embracing employee well-being.

The traditional implicit contract between employer and employee has changed drastically in the last decade. Employees do not just work for a living; they yearn to have more opportunity to be involved in interesting projects that are aligned with their personal goals and passions, alongside a supportive team. HR can, and should support the notion of a conducive work environment. To attract and retain the best talent, as well as to improve employee engagement when staff are at work, it is necessary to embrace their well-being. Well-being is personal, thus such focus would take the relationship between the organisation and its employees to a whole new level of personal affinity and trust. The SMEs have advantage in this area due to the naturally tighter social connections in a smaller setup. What they should do is to find out the specific drivers of well-being or happiness unique to their organisations, and then work on them relentlessly.

- Low Boon Seong, Managing Director of Align Group -