The Analysis on SMEs Human Resource Management

ORIENT ACADEMIC FORUM
The Analysis on SMEs Human Resource Management
ZHAO Lingzhi
Henan University of Urban Construction, Pingdingshan, Henan, 467036
[email protected]
Abstract: Human resources are the largest capital of any enterprise. Human resources management is of
great significance to the enterprise’s survival and development, especially SMEs. This paper analyzes
the existing problems of the human resource management of SMEs in our country and proposes the
suggestion to strengthen human resource management of SMEs.
Keywords: SMEs, human resource management measures, problem, countermeasure
SMEs are the main form of our country enterprises, and have made great contributions to the national
economy, but they have exposed many problems in the social competitive tide. This paper researches the
frequently asked problems of human resource management of SMEs and puts forward some
countermeasures.
1
The Problems Existed in SMEs Human Resource Management
1.1 Human resource management of SMEs showed “deficiencies”
1.1.1 The problems of human resources management organization and staffing
For most SMEs, there was no sound human resources management department, no specific human
resource management organization, or less human resource managers, and they could not play modern
human resource management functions.
Particularly in those SMEs that are operated by family management, human resource allocation is his
family members or his relatives rather than enterprise’s competent persons, and positions are set by boss
rather than by jobs. Enterprise’s reasonable talent selection mechanism and competition mechanism
have not been formed, weakening the SMEs’ internal cohesion, so leading to inefficient utilization of
human resources, and on the other hand a lot of mediocrities occupied key positions, so that they
impeded the emergence of talent. Excellent staff has little opportunity for promotion, and at the same
time the promotion cycle is too long, which will cause a lot of quality, high-level talents to go.
1.1.2 The quality problems of human resource management
SMEs’ personnel engaged in human resource management generally do not have the necessary
professional management knowledge, and their experience is also quite lacking, so leading to routine
tasks such as records management, procedures of staff enrolling and resign partly in order, but the
management level can not work smoothly, and this is also one of the manifestations of SMEs human
resources management “deficiencies”.
1.1.3 SMEs owners and senior management staff lack the awareness of human resources management
Facing the fierce market competition, the managers pay more attention to the business-level problem,
and small energy was input to the internal management.
1.2 SMEs Human Resource Management Model lags behind
SMEs have a large number, but their scales are relatively small, and their technology, financial strength
is relatively weak. They do not have the strength of economies of scale, and also adopted more
traditional administrative personnel management.
1.2.1 The managers lack an in-depth understanding to human resources management. What the
Managers understand the human resource management also remain on the “matter” basis. They do not
really set up a “people-oriented” concept of the right human resource management. They lack the
attention to the most creative individual “people”. Enterprise leaders have adopted a self-projection
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management type, and just wanted to control people, and they don’t think of respecting their employees;
only require employees to contribute, without appropriate incentives.
1.2.2 SMEs lack strategic human resources planning. SMEs generally have short-term behavior,
especially in human resources management, but they lack of creative thinking and strategic approach.
The Managers believe that the main present objective of the enterprise is to survive, how to find
business growth, rather than make a specific planning for the future development of the enterprise. The
managers who conduct Human resources development will find they put a lot of energy and money in
the human resources development, but not rewarded. Enterprise human resources development is at a
standstill state.
In this case, the Enterprise’s human resource development will return to the traditional “coordination
unit” and “logistics services” level, and do not play proper strategic functions of traction, penetration
and development.
1.3 SMEs face a serious, general brain drain
First, the phenomenon of “cronyism” of many SMEs is widespread. Many people pass into the company
by interpersonal relationship, rather than ability and they take the management positions. This makes
part of the outstanding staff in the general positions can be difficult to play their roles, resulting in
excellent employees little chance for promotion, which will result in the loss of a large number of
talented employees. Second, enterprises’ payment allocation and incentives are not reasonable enough.
Single-pay system, the lack of appropriate welfare system is difficult to meet the individual needs of the
employees, especially technical and managerial talent, resulting in brain drain. In the stimulation of
human resources, a considerable number of SMEs’ incentive systems are imperfect. They do not
combine the material incentives with the moral motivation together, lack of “people first” philosophy,
and have not established long-term career planning, resulting in staff’s enthusiasm, initiative and
creativity low, going against giving the full play to their full potential. All causes a huge loss of business
professionals, to some extent.
1.4 The introduction and training system of human resources of SMEs are unreasonable
At present, many SMEs are only concerned about the recruitment process, no specific methods,
especially the lack of a theoretical guide for the selection, basically rely on the examiner previous
experience, interview subjects also lack of carefully designed, to engage a general staff by their loyalty
rather than his ability and accomplishment.
In the recruitment process, enterprises mainly consider applicants qualifications, degrees, experience
and qualifications, ignoring the overall hierarchy structure of internal personnel.
2 Counter Measures to Solve the Problems of Human Resources Management in
Small and Medium-sized Enterprises
2.1 Establish and improve the modern enterprise system and foster the core competitiveness
Modern enterprise system makes human resources as the core competitive strength according to the
principle of scientific management. The core business system has the capacity of innovation and
development, which can effectively motive human resources activities and enable the enterprise to
continuously receive information and kinetic energy from the outside world. Enterprise core competitive
strength is the ideology emphasized in strategic management, it request the enterprise to take part in
international competition and cooperation in professional, scientific management mode. Thus requires
the small and medium-sized enterprises to actively participate in the competition and cooperation of
industry, amalgamate the advantages of enterprises to build the enterprise's kernel competitiveness.
2.1.1 Enterprise leadership should formulate a reasonable measure from the reality of the enterprise, and
should well understand the company’s present situation of the human resources in order to provide
information for the personnel policy decisions to make the idea of people-oriented management
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throughout all links of the human resources management. Only by using the scientific management
methods, can we build a human resources management system in accordance with the enterprise’s
development.
2.1.2 Be cost-effective in the process of human resource allocation, taking into consideration not only
the use of the individual talent, but also the use of talent community. Specifically, what requires in the
allocation of human resource is the concept of contrast, not only to see one’s achievements in the present
post, but to see him at other posts, then achieve the maximize value to maximize the importance of the
talents, placing them in the positions which best stimulate their talent, in accordance with the
opportunity cost principle.
2.1.3 Establish the modern enterprise system; execute the entrusted agency and form the institution of
electing professional managers and staffs through the market competitive mechanism. The inner
management should be modified from "man" to "legal" in system, formulating a mechanism of free
management of administrators as well as staffs. Grant the authority to its managers according to the
company's regulations while improve the mechanism of supervision and motivation.
2.2 Innovate human resources management in small and medium-sized enterprises
Small and medium-sized enterprises in our country need to expand our mind, adopt the advanced
management of human resources, strengthen management of external environment and the competition
mechanism, adjoin the human resources with business management strategy, focus on the development,
training and application of the value of human resources to improve the human resources management
of small and medium-sized enterprises in China. Perfect the setting of institutions, cultivate human
resource specialists, and establish an all-scope human resource management system. Emphasis on the
team management to improve the overall operating efficiency of the enterprise. Reasonably collocate the
talents with a team, develop the advantage of team cooperation to enhance the overall operating
efficiency of the business. Customer satisfaction is an important objective. The company should not
only analyze the value chain of human resource on production and operation, but also analyze that of its
competitors and industry as well as the analysis of the human resources value chain among companies
so as to promote the competitive strength.
2.3 Formulating a human resources planning which is in favor of the development of the
enterprise and staff from the strategic height
Human resource planning is an organization which ensures the supply and demand of the human
resources in the changing world through the scientific analysis and prediction, and formulates essential
policies and measures to ensure that they can get all kinds of elites needed (both in quality and quantity)
whenever and wherever they want, and guarantees the long-term interests of the organization and
individuals. It includes the balance of supply and demand planning, staff complement planning,
personnel training and development planning, personnel distribution planning, promotion, retirement,
discharge planning etc. According to the long-term development, the enterprises should dynamically and
strictly enforce the human resources planning from the whole aspect. According to activation of stock
and the introduction of most-needed policy, it will selects, uses properly and retains the existing elites
through the scientific operational process, and eliminates the unqualified staff promptly and receives
all kinds of elites the enterprise needs through many ways at the same time. To deal with the relationship
between flow and steady, one should not blindly pursue stability and limit forcibly the proper flow
among the interenterprises and internal enterprises so that the organization will develop in an unhealthy
way.
Meanwhile the human resources planning the enterprise formulates should be also conducive to the
development of the staff and makes the development targets of the enterprise the same as that of its staff
to set up a win-win relationship between the enterprise and its staff and then forms the community of
interests and common destiny. This is actually to satisfy the need of the staffs’ self-actualization which
would be more and more close to what they hope. In such a human resource planning, the development
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of the enterprise and its staff is closely related. And the enterprise cannot get a bigger development
without the development of the staff.
2.4 Establishing the dynamic management mechanism of employment
What kind of staff the enterprise has directly relates to the destiny of the enterprise, therefore, the
recruitment is the significant step for its development. Before recruiting, the small and medium-sized
enterprises must be clear about what kind of elites do they need. Thus can they recruit publicly and
establish an open, fair and impartial external recruitment system. Apart from the correspondence with
the responsibilities need when selecting the employees, those who are in conformity with the enterprise
culture are especially important to small and medium-sized enterprises. During this period, the factors of
the enterprise culture indicate mainly in the following aspects: the understanding and generalization to
the enterprise before recruitment: taking the enterprise culture as the criteria in the interview design and
personal quality assessment: the employees should be appropriate test capabilities of plasticity during
the trial. Selection of senior elites needs the participation of the decision-making of the enterprise,
particle inspection present situation and strategic investigation, and release enough space to the true
success.
2.5 Increase investment and intensify human resources development in small and medium-sized
enterprises
The quality and ability in human resources are gained by constant investment. The aim is to make the
primary human resources continue access to education and training which makes qualified staff with
certain health, knowledge expertise and sound social adaptation. In order to gain such talents,
enterprises must set training programs, develop new techniques and necessary knowledge and
professional training to maintain and increase the staff quality. Yet, many enterprises worry that it is like
drawing water with a sieve to invest on such training for fear that they will be a job hopper against the
background of high employee turnover freely. That is just the expression of enterprises’ lacking
self-confidence. In fact, this training is a major method to absorb and stimulate talents as it enriches the
content of the job, increasing working ability and strengthen self-management. The enterprises can
choose various professional training mechanisms according to different conditions, such as technology
lecture irregularly, joint or commission schools with bigger enterprises or universities to increase staff’s
comprehensive quality.
Staff training is a productive investment which requires the enterprises to invest based on plans. Small
and medium-sized enterprises should achieve three willing. One, they are willing to spend money.
Enterprises should never reduce the budget of staff training facing any difficulties. Two, they are willing
to spend time to solve the contradiction properly between work and training to ensure the training time.
Three, they are willing to spend effort to carry out the training in practice. Leaders must spend effort for
the staff training.
2.6 Create effective and incentive mechanism
Enterprises should link performance management with salary management. The dynamic role of human
resources emphasizes that everyone has lofty ideal, ambition and emotion. Development of human
theory indicates that human is a compound body of economic, social man of self. An effective system of
salary management is required to exert the staff’s initiative, creativity and to realize its value of life.
The goal of human resources management is to full explore the enterprises’ human resources and make
the best of the potential of the human resources. But it’s far enough to rely on scientific human resources
management rules to restrain the staff’s acts. The enterprises must set appropriate and effective incentive
mechanism, improve the staff’s life quality and effectively increase staff’s activity, initiative and
creativity to stimulate the enterprises’ vigor. One, the enterprises should establish a salary system with
distribution system as its core. We must adhere to the principles of equal responsibility, rights and
benefits as well as matched responsibility, risk and salary. The salary system should be reformed
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gradually. The key measuring parameter should be job performance, work attitude and working
capability. By distribution of post-paid system, yearly salary system and so on to encourage working
more and getting more. The mature workers will get boon. The workers who make great contributions
will be appreciated. The excellent workers will get bonus. Two, we should set restriction mechanism to
retain staff. We provide staff comfortable environment, meanwhile we should draw lessons from abroad
to set restriction mechanism to set up long-term welfare program and the highest yearly salary system.
By doing this, there will be a close relationship between staff and
Enterprises to prevent brain drain. Three, we must enhance the staff’s moral incentive to satisfy the
staff’s necessities of living, communication and development to the maximum. The staff should be
encouraged to participate the enterprises’ management so the staff will generate a sense of owner and
have chance to display their talents and achieve more. So the enterprises will win more vigor and vitality
in the market competition. The strategy of sustainable development will come into being successfully.
2.7 Forging a corporate culture featured with people-oriented and absorbing talents
The corporate culture refers to the harmony of consciousness, values, professional ethics and codes of
conducts following by all the staff under certain social and economic conditions and social practice. It is
an unique mode of cultural management with values at the core in developing a enterprise or
organization. The corporate culture is of great importance in a corporate sustainable development. The
entrepreneurs must know the value pursuit of its members to realize its people-oriented human resources
management. They should create a corporate culture appropriated to the corporate. They should
maintain this values in all levels. They should create a sound atmosphere to make a steady, sustainable
and developing balance between staff and enterprise. We must establish a basic concept that the
enterprises are people-oriented and the staff is the backbone of enterprises. The enterprise should treat
everyone equally, respecting and caring each. The key of cultural construction in small and
medium-sized enterprises is to overcome the owner awareness and establish a sound relation of mutual
trust, interaction and mutual respect to make the staff give more support to the goal of the enterprises. In
doing this can we forge a huge psychological cohesion and the staff will voluntarily to devote their
knowledge and energy to the enterprise’s overall objective. The enterprise and the staff will become one.
3
Summary
In summary, the enterprises should fully recognize the importance of the human resources and treat
them as the most valuable resources and partners of developing enterprises. The enterprises should
consider more for the staff and be sincere to its staff. The enterprises should take active measures in
human resources management. The excellent human resources service should better serve the
development of the enterprises. Meanwhile, the enterprises should establish the people-oriented
management philosophy which truly shows the respect to the staff and fully exert the staff’s potential.
Through the management of equality, system and objective, we should construct the common value of
enterprises and foster the staff’s cohesion and centralism to reinforce the staff’s study, creation and team
awareness to form a harmony and unity between the staff and society and among the staff. The human
resources management of the enterprises will be further developed and the development strategy will be
realized gradually.
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