Small businesses face many challenges in today’s competitive and uncertain economy. One of the most critical factors for their success is the performance and engagement of their employees. However, many small businesses struggle to invest time and resources into developing and nurturing their human capital. In this article, we will explore some of the benefits and strategies for unleashing the potential of employees in small businesses.
The importance of employee performance for small businesses
Employees are the most valuable asset for any business, but especially for small businesses. According to the Australian Bureau of Statistics, there are 2.4 million small businesses in Australia, employing 44% of the total workforce. Each employee’s contribution is significant and can make a difference in the business outcomes. Therefore, improving employee performance can have a positive impact on productivity, profitability, customer satisfaction, and innovation.
Moreover, enhancing employee performance can also help small businesses attract and retain top talent. According to a survey by Culture Amp, a global employee experience platform, 89% of employees in Australia and New Zealand said that learning and development opportunities are important or very important for their job satisfaction. Additionally, 76% of employees said that they would be more likely to stay with their employer if they had more opportunities to learn new skills.
Five ways to supercharge employee performance in small businesses
How can small businesses foster a culture of high performance and engagement among their employees? Here are five practical tips that can help:
- Embrace a culture of feedback: Feedback is essential for personal growth and professional development. By creating a culture that values open communication and feedback, small businesses can foster a sense of trust and collaboration among employees. Feedback can help employees identify their strengths and areas for improvement, as well as align their expectations with the business goals. According to Culture Amp’s data, organisations with strong feedback cultures report 14.9% higher employee engagement scores compared to those without.
- Set clear expectations: Providing employees with well-defined job descriptions, goals, and performance metrics empowers them to understand what is expected of them. Clarity around roles and responsibilities helps individuals align their efforts with organisational objectives. Small businesses can utilise tools like performance scorecards, regular check-ins, and goal-setting frameworks to establish a performance-driven environment.
- Encourage skill development: Investing in employee training and development initiatives is an effective way to enhance their skills and competencies. While small businesses may have limited budgets, there are several cost-effective options available, such as online courses, webinars, and mentorship programs. According to Culture Amp’s research, organisations that prioritise skill development have 30% higher engagement scores than those that don’t.
- Recognise and reward achievements: Recognition is a fundamental human need and can significantly impact employee motivation and job satisfaction. Small businesses can implement recognition programs that celebrate individual and team accomplishments, such as peer-to-peer recognition, monthly awards, or public acknowledgments. Our data reveals that organisations with robust recognition programs have a 23.3 per cent higher engagement score than those without.
- Foster a positive work environment: Creating a positive work environment is crucial for employee engagement and performance. Small businesses can promote a positive culture by encouraging work-life balance, offering flexibility, and prioritising employee well-being. Cultivating a supportive and inclusive workplace culture not only enhances performance but also helps attract and retain top talent.
Leveraging technology to unleash employee potential
Technology can be a powerful enabler for improving employee performance in small businesses. Technology can help automate tedious tasks, streamline workflows, enhance collaboration, provide insights, and facilitate learning. For example, small businesses can use cloud-based platforms to store and share documents, video conferencing tools to communicate with remote teams, analytics tools to measure and improve performance, and e-learning platforms to access online courses.
However, technology alone is not enough to unleash employee potential. Small businesses also need to adopt a human-centric approach that focuses on developing the human capabilities of their employees, such as curiosity, imagination, creativity, empathy, and courage. These capabilities can help employees adapt to changing situations, solve complex problems, generate innovative ideas, and connect with customers.
By embracing a culture of feedback, setting clear expectations, encouraging skill development, recognising achievements, fostering a positive work environment, and leveraging technology, small businesses can unlock the potential of their employees.
