Issues and opportunities for Small & Medium Sized Businesses (SME’s) 
Small and Medium sized companies may face a number of disadvantages in trying to lure such talent.
For one, their pockets typically aren’t as deep as publicly run corporations. One of the more pressing talent challenges closely held companies could face is making connections between candidates and openings in tough-to-fill jobs.

Almost two-thirds of the respondents in Deloitte’s mid-market survey agreed that “it is difficult for us to find new employees with the skills and education to meet the needs of our business.” One in five reported that skills shortages are suppressing their company’s growth.

Smaller companies may face a number of disadvantages in trying to lure such talent. For one, their pockets typically aren’t as deep as public corporations. In addition, because of their smaller HR staffs, they sometimes tend to lack the capabilities and organizational infrastructure needed to be both generalists and talent experts. With fewer resources at their disposal, HR leaders at privately held companies can feel like their “want list” is a mile long, making it tough to pick a starting point.

For some sought-after talent, small or mid-market companies may not appear on the surface as appealing as working for a high-profile corporation. A lack of clarity around the value proposition of working for a mid-sized business can make it more challenging to land skilled workers who are in hot demand.

Training is another area where, despite recent inroads, SME’s sometimes tend to underinvest. Many owners at small and medium-sized businesses hamstring their HR departments by their belief that leaders are born and not made, only to see promising young leaders leave for greener pastures where their development prospects are clear and supported.

To attract the right talent in this environment, you need something that differentiates you as an employer.

In dealing with these challenges, SME’s potentially have a leg-up on the competition because they have inherent traits that job-seekers look for: access to leaders, an entrepreneurial culture, and opportunities for advancement. But they should also be more proactive on a number of fronts to attract and retain the talent they need in today’s competitive marketplace.

Decide what you’re going to be good at from a talent perspective and own it.

To attract the right talent in this environment, you need something that differentiates you as an employer. This need could elevate talent management out of the realm of tactics and into strategy-setting. Think about the markets you’re competing in and what your company is doing to differentiate itself in those markets to help shape them. Once you know that, the next logical step is to identify the kinds of people that are going to help you develop and exploit that advantage.

For example, your company is looking to make a mark on its industry through financial analysis and strong client relationships. Recognizing this can help focus hiring efforts and associated budgets on finding people who can connect with customers and manage opportunities and risks.

Spot potential and grow it fast.

Successful companies drive leaders at all levels of the organization, and when one of these critical people walks out the door, it can force the company to lose its focus as it deals with the disruption.

Treat your workforce as the growth engine of your business. Identify future leaders throughout the company and spend the time and effort to develop them. In-house training is one way companies can make reasonably certain that promising employees feel valued. In fact, in Deloitte’ mid-market survey, nearly two-thirds of the executives cited traditional internal training and development as the best way to cultivate future leaders, and covering the cost – in whole or in part – of external skills training and development was the second most-popular approach.

Here’s another thing: if one of these future leaders comes to you announcing a job offer from another employer, engage them in a conversation about their career ambitions. Many family-run businesses, in particular, tend to fall into a “loyalty trap,” where they may feel like any employee actively looking for a job elsewhere is being disloyal to the company. You should create an open working environment where your workers feel like they can come to you and start a career conversation. In that sense, “I’m leaving” should be a career pathway as opposed to a closed door. Once you have that kind of talk with one worker, others will likely be more forthcoming about their own feelings and may be a lot easier to retain than those who remain silent.

Compete on issues other than compensation

It is not about being the top payer in your field. You want to be competitive without going overboard.

Instead, make your workplace “simply irresistible.” The companies that do the best job at engaging employees – and keeping them around – tend to do five things really well. For one, they provide meaningful work, along with the autonomy employees need to be creative and perform well. Second, they are run by effective management teams that value coaching and feedback, and help their employees slow down and appreciate how they are contributing to the big picture. Third, successful employers offer growth opportunities, enabling people to move from job to job without fear of failure. Fourth is an inclusive, flexible, and fun environment; not every company needs to offer ping pong and free food, but there are plenty of things companies can do to treat their people well. Finally, employees want to work for leaders they can trust and who have a mission and a set of values that they can appreciate and look to emulate.

It’s also important for companies in expansion mode to keep their work processes simple. Growing companies can have a tendency to add layers of oversight and complexity, whether it’s in the form of additional meetings, manager check-offs, or some other layer of bureaucracy. Resist this. Avoid over-complicating your processes, and your employees will thank you for it.

If you’re going to increase someone’s salary, consider your HR leader.

Companies can save money over the long term by making smarter talent investments and freeing up other leaders to focus on growing the business. Instead of an operator or order taker, you should consider hiring a talent strategist who is going to help you grow the business with the right talent behind it. That takes special skills, including the ability to make the company’s value proposition “sing” in the market, to forecast the kinds of capabilities the organization is likely going need to add in the future, and to develop new ways to reach prospective employees.

As mid-market leaders ponder their talent strategy for 2015, they should be thinking of taking advantage of these inherent advantages by asking themselves the following questions:
• Is our talent strategy aligned with our business strategy?
• Are we doing enough to cultivate the next generation of leaders and keep them engaged?
• Are our managers equipped to manage and develop world-class talent for the long term?
• Are we offering the right kinds of work/life incentives to land the right talent without offering them the biggest paycheck?
• Is our HR leadership thinking strategically about our business needs, in addition to running the day-to-day operations of HR (so the business doesn’t have to)?

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