Human capital management specialists at enterprises large and small speak in a unified voice on one critical issue: workforce quality is almost always the single most important determinant of long-term success for any business of any size.
"The issues involved here are not really that much different between small businesses and large corporations," says Matthew Owenby, senior vice president and chief human resources officer at Aflac, which employs about 10,000 people. "The quality of our workforce is really the difference between success and failure in the long term."
It's especially important for smaller businesses that the quality of their workers be high because the impact of each employee on business outcomes is magnified. "You may be able to get by in the short term with just average employees, but it will show massive effects over the long term," he says.
Steven Benson is founder and CEO of Badger Maps, which has a workforce about one one-thousandth the size of Aflac's, and he couldn't agree more. "Productivity and profitability go hand-in-hand. There is nothing more important a business leader does than recruit and hire people who are a great fit for the team," he says. "If I only get one thing right, it has to be this."
But getting it right is a challenge for many small and midsized businesses. For starters, they simply don't have the resources big companies have to find, vet, hire, and retain top-tier employees. Then there's the issue of the talent pool itself. With the economy growing and unemployment rates shrinking, competition for the best of the best is intense.
Bob Funk, CEO and chairman of Express Employment Professionals, says that leverage in the job market is shifting, and "workers will soon have the upper hand with potential employers." He cites situations like that in western Michigan, where unemployment is about 3 percent, and inability to hire is throttling growth for some businesses. In Huntsville, Alabama, the local Express Employment Professionals office had to increase compensation even for unskilled workers because turnover is so high.
One of the most effective tools for SMBs intent on hiring the best employees in an environment like this is to partner with a highly qualified staffing company like Express, Funk suggests. "We're recruiting and interviewing all the time in order to have people ready and available to fill positions in the workplace," he says. "We have strong relationships with career technical educators and community colleges to keep them informed about business needs. We also help guide their students toward training and occupations that are readily available at our client companies."
From a strategic perspective, it's important that SMBs develop the ability to identify their hiring needs ahead of time, says Mary M. Massad, president of the recruiting services division at Insperity. Doing so allows them to be proactive in their search for talent rather than reactive when a vacancy occurs.
"The challenges here are identifying the landscape, identifying what your needs are, and trying to anticipate what those needs might be in the future," she says. "Will you see growth in a certain area? Are you going into a new market or launching a new product line? You need to have a hiring and staffing plan in place to deal with those things so you are ready when the need arises."
Developing and executing the strategy, Massad suggests, starts with identifying your business's "employment brand" and being able to convey to potential candidates what it means to join your company. Social media is a highly effective tool for that.
"Businesses should be using all social media platforms to convey who they are and why they are a great place for top talent. Oftentimes, small businesses don't realize the opportunities they have in front of them from a social media perspective," she says. "It's almost unlimited what they can do for very minimal expense."
Another important step is devising an end-to-end plan for hiring and onboarding top talent. How many layers of interviews will you use? Who will conduct them? Are you going to run background checks on candidates?
What will they encompass? These are very traditional tools, Massad acknowledges, but they are important and should be well thought-out before you start the recruitment process. Finally, one of the greatest advantages SMBs currently enjoy in the competition for great talent is the flexibility and soft benefits they can offer--things that are especially important to millennials. "Brilliant people don't just want a nice pay check," says Michal Strahilevitz, a behavioral economist and visiting scholar at Duke University's Center for Advanced Studies.
Having a culture of appreciation is huge, as are the benefits that flow from it, she says. "Great employees like working with other great employees. If the people you work with are smart, motivated, and solid team players, you will do better work, be happier, and stay at that company longer."
Owenby adds that the flexibility SMBs are able to offer in areas like work-life balance can help offset their lack of scale and bargaining power when competing against big companies for the best talent. But the clock is ticking on that advantage. "Large corporations like mine are becoming more progressive, so eventually that advantage will fade," he warns.
A small business owner has a lot of plates to spin to keep the business running smoothly, Funk says. Recruiting new staff members takes an enormous amount of time and expertise and often requires finding a needle in a haystack. "A staffing company can be your greatest partner for finding good talent to work in your business."
But whatever approach they take, SMBs need to get in the mindset of investing in and training their people, Funk stresses. "As the recruitment war takes off and wages rise, there is reason to hope that unskilled workers will respond and jump into the work - force in greater numbers," he says. "Society can't give up on these people, and these would-be workers can't give up on themselves."