Talent Management: A Challenge for SME Enterprises
Managing Talent is a very important factor for businesses both large and small. The major challenges faced by a SME in managing talent arise due to its budgetary restrictions and inaccessibility to newer and more effective talent management plans.
Managing Talent is a very important factor for businesses both large and small. Companies irrespective of their size and years of existence face the same set of problems with regards to their Talent Management plan- Attracting the right talent pool, Selecting, Training, Motivating, Deploying, Developing and Retaining. While the bigger companies have lot of options to invest on and a plethora of possibilities to capitalise on, the start-ups and SMEs face a lot of challenges in managing and retaining their talent pool.
The major challenges faced by a SME in managing talent arise due to its budgetary restrictions and inaccessibility to newer and more effective talent management plans. The most common challenges faced by SMEs with regards to talent management are:
1. Talent Acquisition
Acquiring the right talent pool with the desired skill set can prove to be pretty difficult especially in the mid and senior level positions. With the competitor companies offering more lucrative and attractive salary packages and a better brand name, it becomes very difficult for small start-ups and SMEs to get access to desired talent pool. Even after acquisition there are many instances where these SMEs lose talent to bigger companies due to the brand name and bigger salary packages
2. Lack of Expertise
While the larger organisations have a better trained and expert HR team which has better talent management skills, a SME can’t afford an elaborate HR team and restrict themselves to sourcing and employee relations. This results in an inability to solve more complex talent management problems.
3. Lack of Tools and Software Support
Often, the SMEs and small size companies do not have access to latest technologies and tools which would enable effective talent management. SMEs resort to using less expensive and less proven technologies leading to waste of time and less productive results.
4. Limited Talent Management Professionals
The SMEs can’t afford a big personnel management team as they are not revenue generating. This leads to delays in processing and solving HR issues, more burdened HR team playing multiple roles and less time allocation for talent retention strategies. Also things like mentoring, one-on-one coaching and devoting a large amount of time in solving talent management issues is impossible in a SME. The talent pool in such organisations is more likely to quit and move to other companies resulting in high attrition rate.
5. Criticality of a Good Hire
When an organisation has limited employee strength, the criticality of retaining each hire increases. Attrition in a big company will not have a significant effect as that in a SME. This increases the challenge of recruiting the right kind of talent and the efforts put in retaining and keeping them engaged and happy. An engaged employee is one who is less likely to leave a company. But for a SME, employee engagement plans would mean a calculated number of unproductive or low revenue generating man-hours. Thus it becomes very essential for such organisations to do an in-depth research on the available options of employee engagement which would suit both their budget and their time allocations and productivity goals.
6. Inability to Offer Career Growth
In case of a SME, there is not much of a scope for a career growth ladder. The entire organisational hierarchy would involve a handful of employees. With the already fixed budgetary restrictions and the inability to offer vertical growth, the management must come up with an alternate talent management plan to compensate for it.
There are many challenges for a SME with regards to managing talent but there are many advantages also which can be leveraged on like the ability to build a sense of belonging and ownership, employee based organisational value building and better connection with the employees due to the fewer hierarchical layers.
Tackling the Situation
A business needs an effective Talent Management Plan designed by experts to meet the daily challenges related to acquiring, managing and retaining talent. While some develop their own strategies, many others take the smarter route of outsourcing their talent strategy to top talent management companies who have expertise in this area. This enables a better approach to the problem and also decreases the burden on the management.
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