Many startups begin without a human resources department. The company is small, and hiring someone to manage just a few employees isn’t the priority. But, as the company grows, things start to get complicated: The business needs HR.
And, oftentimes, that starts with "an HR department of one."
That’s right. Growing businesses don’t need an enormous HR team; even just one person can get the job done. Eventually, when the organization gets big enough, a larger HR department will be a necessity. But until a full team becomes necessary, a one-person HR department can be an amazing force.
Here are three issues that even an HR department of one can help you solve:
1. Lagging communication
The smaller a team is, the closer its members are. Every employee is key and contributes his or her ideas and opinions. The small staff works alongside the CEO and founders to drive the business forward.
Yet, as companies grow, the gap between the executive team and employees widens. Employees don’t have the immediate access to the C-suite that they've grown used to -- but you never want their voices to get lost.
In fact, a 2015 Society for Human Resource Management (SHRM) survey of 600 U.S. employees found that only 37 percent were "very satisfied" with the consideration managers gave their ideas, and just 23 percent were very satisfied with their communication with senior management.
What’s more, a survey of more than 800 full-time U.S. employees conducted by Globoforce in November of last year found that 47 percent of respondents didn't think their company leaders cared about or actively tried to create a "human" workplace.
That’s where the HR professional comes in. Even a single HR professional can bridge any communication rift arising between employers and employees. This one-person HR department serves as a representative for your people. Employees share their thoughts, concerns and ideas; and HR shares them with management.
In addition, an HR person brings the employee perspective to business decisions. While the executive team focuses on scaling the business, an HR department of one is there to make sure it’s sustainable -- built with the interest of employees in mind.
2. Complicated compliance
With more employees, communication isn’t the only thing that gets more complicated; compliance becomes a whole new animal.
As new employees arrive, employers need to follow more regulations. For example, the Affordable Care Act (ACA) rules for 2016 require companies with 50 to 99 full-time equivalent employees to provide health insurance to at least 95 percent of their full-time staff or face a fine.
It’s new regulations like the ACA's that raise questions and concerns for smaller businesses starting to feel the impact of the new legal landscape. And the ACA is only a small piece of the compliance puzzle. New overtime rules -- which can particularly impact small businesses that rely on part-time, contract and flexible talent -- plus other changing laws make compliance tricky.
Employers need an HR expert who can better understand and manage laws and apply them to a larger set of employees. The one-person HR department keeps the company on track so the employer never has to worry about compliance.
3. Recruitment and onboarding
As businesses grow, they need more talent to keep the momentum going. And that requires recruitment and onboarding. Small businesses may already have their own hiring and training processes, but now they need to adapt, to hire and train more and more employees at the same time with the same amount of efficiency.
This is where many startups stall. They can’t hire the talent they need, when they need it. Research from Bersin by Deloitte found that companies surveyed spent close to $4,000 per hire in 2014. And that didn't cover the costs of lost time and productivity while any position sat open -- an average of 26 working days, according to the most recent data from the DHI-DFH Mean Vacancy Duration Measure published in April.
Once companies do hire new employees, a lack of training can set them up to be unsuccessful. According to a survey of more than 400 employees by Learnkit in 2015, 40 percent of respondents said they would be more engaged at work if they had better onboarding. In addition, 61 percent of disengaged employees said they could do their jobs better with better training.
How can employers fix recruitment and onboarding issues? With an HR department of one.
The HR professional can help establish referral programs, reach out to industry contacts and use more effective sources of hire to recruit top talent faster. Then, they can set up formal onboarding processes, assign workplace mentors and more to engage new talent and keep those people around.
The right tools
All these responsibilities may seem like a lot for an HR team of one to handle, but it’s possible, with the right tools and resources. A single HR professional can get the job done for a growing business by automating tedious tasks.
Tech can take care of time-consuming administrative tasks like running payroll and enrolling employees in the right benefits. That way, the one-person HR team can do what employers need him or her to do -- interact with and manage talent. Software picks up the slack so a single HR professional can do it all as the company grows.