Small businesses are the backbone of the U.S. economy, accounting for 99.9% of all firms and employing almost half of the private sector workforce. However, many small businesses struggle to survive and grow in a competitive and dynamic market. According to the Bureau of Labor Statistics, 20% of new businesses fail within their first year, and only 35% make it to their 10th anniversary.
What sets apart the successful small businesses from the ones that fail? One key factor is how they view and treat their most valuable asset: their people. Investing in people development and enablement is not only a moral duty, but also a strategic advantage that can boost productivity, innovation, retention, and customer satisfaction.
People development starts from day one
Many small business owners and managers tend to neglect or postpone HR processes and people enablement, thinking that they are not a priority or that they can be implemented later. However, this is a costly mistake that can have negative consequences for both the business and the employees.
People development should start from day one, as soon as a new hire joins the team. This means providing them with a clear and engaging onboarding process, setting realistic and measurable goals, offering regular feedback and coaching, and creating opportunities for learning and growth. By doing so, small businesses can ensure that their employees are aligned with the company’s vision and values, motivated to perform at their best, and equipped with the skills and knowledge they need to succeed.
People development is a competitive edge
Small businesses face many challenges in attracting and retaining talent, especially in a tight labor market where employees have more options and expectations. According to a recent survey by Mercer, 70% of all large employers are planning benefit enhancements for 2023, making it harder for small businesses to compete.
However, small businesses can gain a competitive edge by offering more than just monetary compensation. They can offer a comprehensive suite of benefits that support every aspect of their employees’ well-being, such as health insurance, mental health services, flexible work arrangements, educational assistance, financial wellness tools, and more. These benefits can help small businesses differentiate themselves from their competitors, increase employee loyalty and engagement, and reduce turnover costs.
People development is a driver of growth
Small businesses that invest in people development and enablement are not only doing good for their employees, but also for their bottom line. Research shows that there is a strong link between employee engagement and business performance. For example, Gallup found that highly engaged teams show 21% greater profitability, 17% higher productivity, 10% higher customer ratings, and 41% lower absenteeism than disengaged teams.
People development is also a driver of innovation and creativity, which are essential for small businesses to adapt and thrive in a changing market. By fostering a culture of learning and feedback, small businesses can encourage their employees to experiment with new ideas, learn from failures, collaborate with others, and solve problems creatively. This can lead to improved products, services, processes, and customer experiences that can give small businesses an edge over their competitors.
How to implement people development in your small business
Implementing people development in your small business may seem daunting or expensive, but it doesn’t have to be. There are many resources and tools available to help you design and execute effective HR processes and people enablement strategies. For instance:
- You can use online platforms like Leapsome or Lattice to manage performance reviews, goal setting, feedback, recognition, learning, and engagement surveys.
- You can use online courses like Udemy or [Coursera] to provide your employees with access to thousands of learning opportunities across various topics and skills.
- You can use online tools like [Gusto] or [Zenefits] to streamline payroll, benefits administration, compliance, and HR management.
- You can use online communities like [Small Business Forum] or [Entrepreneur Forum] to connect with other small business owners and managers who can share their insights and experiences on people development.
The bottom line is that people development is not a luxury or an afterthought for small businesses. It is a necessity and an opportunity that can help you build a strong team that can drive your success and growth.
