Catalyhom

Recruitment in very small businesses

21/10/2011 Olivier GIRARD

The main difficulty for small organizations, i.e. very small businesses (VSB), is recruitment.

In spite of increasing unemployment, hiring remains an issue. “Turn in the economic situation has not solved the inadequacy between supply and demand, according to Joël Ruiz, CEO of Agefos PME. This is very paradoxical.” One enterprise out of two faces difficulties in recruitment, especially in small and medium-sized enterprises with a staff from 10 to 199 employees. Building and civil engineering works is the sector facing the most challenging situation. Why? Because of the shortage of candidates for certain jobs (in building and civil engineering works), lack of motivation and skills and the levels of salary offered.

The term “human resources”, used in big companies, is not adapted to the very small businesses environment in which leaders speak more naturally of “human relationships”. Actually, relationships play a major role in VSB, since the smaller the company, the more the atmosphere and the working relations can impact the climate and the production of goods and services in the company.

The Head of a VSB does not have an organization that would allow him to take decisions with full knowledge of the facts regarding human resources. He often assumes alone heavy human responsibilities. He has to manage on his own, even during peaks of activity. He has to take care of recruitment, salaries, bonuses, welfare benefits and professional development. His management is driven by urgency and short term. Therefore, he does not feel the need to explain the procedures he applies nor to formalize processes that would allow him to delegate certain tasks. However, he often turns to his chartered accountant for advice because this person is very competent in his work. Indeed, within small businesses, hiring an additional co-worker represents a cost, a real investment which commits the going concern.

The chartered accountant thus seems to be the most capable of validating the relevance of this cost. The absence of formal rules, procedures or standards can generate dysfunctions. Though the intuitive character of the strategy of the VSB often turns out to be a factor of flexibility and adaptability, it can on the other hand decrease the efficiency of the organization staff which, as soon as it reaches about ten people, needs more solid marks.

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