Is it time to invest in a Human Resources Department?

I’ve just had a discussion with a business in Manchester about when during the growth of a company does it become necessary to think about setting up a Human Resources Department.

Well obviously given what I do, my answer is always going to be on the side of outsourcing but it made me think what are the triggers for making some form of Human Resources department attractive, and why do some companies manage perfectly well without a Human Resources professional on the payroll, and have over 300 employees, and others feel they need one when they get more than 50 staff.

My take on this is as follows:

When an entrepreneur (or anyone else that matter) starts an organisation they personally recruit the staff and have regular day to day contact with them either face to face or over the phone. The staff member and the owner get to know each other pretty well and if they get on, all generally goes according to plan. If it doesn’t go well the employee usually gets another job (most of the time without being dismissed, they just leave.)

This continues as the organisation grows and the driving force behind the organisation keeps regular contact with the staff, communicating their vision to the employees, who either buy into this or not.

In my experience it doesn’t matter whether the driving force is a skilled motivator, who keeps staff involved and makes them feel included and loved, or a martinet who barks out instructions and expects them to be obeyed. In most cases the staff either stay, and just get on with it, or leave. So the nature of the driving force determines the type of employee they get. What surprises some HR professionals is that there are people out there who prefer to work for a Genghis Khan type of character, rather than an inclusive charming motivator.

So far so good, but when the organisation develops further and gets above a certain size, the driving force no longer has direct contact with each employee and has to employ managers to do that for them. This means that the vision the entrepreneur has is no longer directly passed on to the staff, but filtered through a third party. The point at which this occurs differs depending on a number of factors:

1)      The ability of the driving force to spread themselves thinly

2)      The structure of the organisation (i.e. is it multisite or single location)

3)      The complexity of the tasks the organisation undertakes

4)      The influence outside bodies have on how the organisation functions

Each of these factors is worthy of discussion on their own but for now the point is that all organisations reach this point in their own time.

Once this happens it is the appointment of managers which can be the key. If the people who are appointed to management positions have management and administration skills rather than just being good at the job they do, and their style of management matches or at least compliments the driving force’s style. Things tend to move ahead remarkably well.

If any of these factors aren’t properly established then the organisation starts to fracture and not be properly focussed. This is when people start asking for a Human Resources department to bring things together into a coherent and consistent management style, and to cover all the administration work that is required both in law and to keep the business ticking over. The first steps are then taken to getting an HR manager. Often the person given this job is the P.A. to the driving force because she (and it usually is a she), has the most in depth knowledge of what the driving force wants and is usually an effective administrator. The problem with this is that sooner or later the P.A. gets bogged down with HR management work and is no longer able to fulfil the functions that she originally had. I would also observe that I have worked with some fantastic P.A.s in my time and the best of them had an attitude of “give to me, and I’ll deal with it”. The problem with this is that it tends to mask the shortcomings of internal managers.

But what if the company approach an HR manager from outside? They may not follow the driving force’s way of doing things, indeed the very fracturing that created the need for an HR manager in the first place is made worse by their appointment. Also in these circumstances, all the HR manager is doing is talking over the functions of the operational manager, weakening their authority and allowing poor performing managers to “dump” jobs they don’t like.

In my view it is for better to recruit the right managers who follow the lead of the driving force, and insist they take responsibility for their management decision.  Then you outsource the technical stuff making sure the provider is fully conversant with the driving force’s style and vision because then if it doesn’t work out you can just cancel the contract and get someone else in. With an HR manager you will have to deal with them as an employee. The problem is you brought them in for just the type of expertise you now need to use on them!

The final point is this, a full time HR professional can cost between £25k and £35k on salary alone (the cost of employing someone is usually calculated as about one and a half times to twice the salary). Then you need to see if they need admin support which can cost an additional £15k to £25k on salary alone, outsourcing a full HR support package will usually cost less than half this amount.

Also as someone once said to me, if you appoint an HR manager and they make a mess of it, you will have to pay the bills. If you outsource it and it doesn’t work you claim off the contractor’s insurance.

I know this is a somewhat contentious view but as someone who has been both the driving force and the person who tried to work against the flow (with the expected consequences on both occasions!), I know an internal HR manager would have made no difference to the final outcome in either case.

What are your experiences of managing HR in your business? How did you resolve the issues raised above? Are you going through this at the moment?

Any comments and opinions would be welcome and you can respond directly by calling me on 07879 551256 or e-mailing kieronh@khes.co.uk

Networking

When I set up KHES Ltd the one thing I didn’t look forward to was the whole sales process. Problem is, without it no business can reach its potential.

There just seems to be something “wrong” about contacting people out of the blue and trying to persuade them to part with their hard earned cash. Yes I believe I am offering a great service, and yes I have no difficulty in explaining how my service can save time and money for businesses so they can more profitable.  But when I start saying these things how do I get past that glazed look that says “oh god, he’s trying to sell me something” or even worse, the muffled sound when someone puts their hand over the receiver to get on with their busy day while you are left talking into the air!

Some of you may know my sales “guru” Andy Hall from AHEM – Marketing and he was always saying things like “people buy from people” and “when selling don’t pretend to be what you aren’t.” still the question comes “that’s fine but how do I start the discussion that leads to a sale?”

The answer struck me recently, “Don’t”. Just get to know people who may need your service or who know people who might (so that’s everyone then!) talk to them, if they like you, and you like them, they will either buy your service when they need it, or refer you to their friends.

I know it’s not rocket science and a few readers will wonder how such a slow learner got past his 11 plus (yes I am that old), but for me I avoid all the angst by networking. But the next bit of learning only came a couple of months ago. If all you do is go to networking meetings and wait for people to decide to buy your service, your business will grow very slowly indeed. I’ve had to learn to cultivate relationships follow up with people I meet and learn about them, which is just as hard work as any other form of sales, it’s just that I enjoy it more, and it doesn’t scare me.

But what if the thought of going into a room full of strangers fills you with dread, your mouth goes dry, your heart starts pumping and you lose the power of speech?

Well there are several solutions many of them involve alcohol or drugs but networking when drunk is not usually advisable. The thing is that was how I felt at first as I was so desperate to tell people about my services. What I did was change my approach and go to a meeting to find out about other people rather than tell them about me. I found with that approach I still ended up talking about my service, but only when people asked me to, which felt a lot less pushy.

Anyway, here’s a thought, at a meeting last night I was told by a couple of people how nervous they were of networking, so how about setting up a networking taster seminar where experienced networkers can help new business owners get over these nerves?

Anyone interested?

Day 7 Last day and no Jaffa Cakes!

Let’s be honest, you don’t have to work somewhere for a long time to start enjoying it or connect with people. I understand the pain of leaving people for a new job role or store as I did it when I was 18 and working at McDonald’s and all I did when I found out was cry. But that was different, I wasn’t expecting that, this I was but it’s still pretty upsetting.

As I walked into the office, it was just me and Kieron, well not for long. He left after about 15 minutes for a meeting and then I was all alone. Ending my last day as a work experience person writing up reference forms and letters as well as completing the CV spread sheet. I’m surprised I wasn’t given scanning! Thought it would be my “goodbye” gift, the one thing I loved the most. Thankfully not.

Although I wasn’t alone, Jonathan turned up and made me a cuppa tea. How lovely of him. But the company didn’t last. After about 30 minutes he left as well. Quiet time again. All I had to keep me company was a bag of Aero orange bubbles. Rather have Jaffa cakes to be honest. Mmmm. I was half way through the remaining CVs when Kieron arrived. Hurrah! I had company again! That lasted about 3minutes as he shot of again. I feel like I’m the geek in the library at mid-night doing work when the odd person pops in says hi then goes again. *sigh* Oh well.

Once I had finished all my work, it was only just gone 1pm. Well that’s what I thought. As I was typing that sentence, I looked around for inspiration and noticed two sheets I completely forgot to do! And guess what…it was scanning! So I was left with my ‘favourite’ task. (Memory of a goldfish sometimes)  Anyway, let’s try that again. I have finally finished all my work which meant it was time to go home. I was lucky to say my goodbyes to Kieron earlier but I’m sure Andy and Jonathan will know when they read this.

My experience at Kieron Hill’s Employment Service has come to an end. It has actually been a very funny, enjoyable learning curve in my decision into full time employment. I have had proof that I love working within the employment industry and have learnt so many skills from the past month especially CV skills, covering letters and the law. Although this will be the last entry of my blog, this will not be the last you have seen of me. Keep your eyes peeled and ears open because one day when you send KHES an email or give them a call, it may be me that responds to you, no promises just hoping.

Thank you to Andy and Jonathan for your witty banter and bizarre yet funny conversations which kept me sane when I was completing brain melting tasks. Thank you to Kieron for the experience and time you have put into me. The skills and training you have given me that have allowed me to understand the employment industry in more detail and has let me experience it first-hand.  And thank you all for following my experience with me. I hope to speak to you all again soon but for now, so long .

Day 6 Revenge of the teacake

Its Thursday so not long now until the weekend starts again. Once I arrived at the office, Kieron was out but for once I was not alone as I still had the company of Andy and Jonathon although I had so much to catch up on, I probably wasn’t the most exciting person to talk to. It was a pretty standard day; scanning, organising files, asking for references and then passing them on to the clients to keep a record but I did have one important task which could affect everyone if not completed correctly and possibly cause mayhem if not accomplished!…well really all it was, was popping to the shops to get milk, but believe me, if you’ve read the previous account you would understand that this enterprise runs on coffee and tea!

My tasks didn’t take very long to complete so I spent most of the time job hunting to see what is expected of me to get into this line of work but to be honest, I was more distracted by Andy and Kieron’s random conversations. One that sticks out was the discussion of man’s favourite food…bacon, but more in this case, what is the correct name for a bacon sandwich. I’ve heard this bread naming debate from the moment I moved up north. Its seems to be a culture shock to anyone down south, only calling it a butty or sandwich but up north, they have loads of options. It a conversation I am involved in all the time from people at university and home arguing over it. While me and Kieron just sat back and watched, Andy went on a little rant about all the different names he had heard and what he believed was the correct one. We went from sandwiches, rolls, bap, butty and one I never hear anyone refer it as, a baguette. It reminded me of the time I got into a debate with someone about a ‘teacake,’ me saying it was  bread with fruit in, someone else saying it was just a roll etc…the many hours wasted talking about bread yet no philosopher has come to the conclusion therefore we must suffer in silence.

Overall, today was a very simple, easy day with little activity on my behalf although the banter of the office and relaxed environment has made me settle into the working life of an office worker and I like it.

Day 5 Revenge of the alarm clock

This was the first time I had seen 6am for a very long time. I think the last time was when I went on holiday and had to up at 5am for the flight although that was easy. I was excited and buzzing to leave! Not in this case, I was exhausted and I needed to be on time as we had a potential client to meet, but as usual when you’re in a rush or running late, public transport decides to play a game with you. Very frustrating! Nevertheless, I made it and even had time for a quick coffee.

We arrived at the meeting where we greeted one another. The meeting began in a friendly manner although in my opinion, I felt like I was at a family reunion. Laughs, smiles, excitement, like any reunion, great at the start yet never thought it would end. After the family gathering and ‘getting to know you’ part of the meeting had ended, the meeting commenced into the main reason why we were there, work. After nearly an hour discussing the issues the client had and giving advice, the meeting was over. Good timing I think, I had been staring quietly into space although I had attempted to write up notes, sadly this looked more like a letter from your doctor. What a mess… Anyway, the face to face approach towards this client and others was a more appropriate for the business needs compared to cold calls or pestering individuals who don’t need the service.

Once we returned to the office and settled in with a cup of coffee, (think I’m becoming addicted) I was greeted with an email from the client I had previously adjusted a contract for. To be fair the points they made were incredibly picky, my first thought was “are you kidding me you can’t change the word yourself.” Laziness but you pay me to do it…sort of.

Once finished, I completed the mileage claims and expenses spreadsheet to help organise the finances. He probably picked the wrong person for the job. Maths is worse than having to do research! Some of it was such a waste of time. When am I ever going to use algebra on a daily basis! Whose idea was it to incorporate the alphabet with maths anyway! Maths is complicated enough! I don’t want to have to sing my ABC’s as well…Rant over. It wasn’t even that bad, all I had to do was enter numbers into a spread sheet. Panic for nothing.

It was nearly time to end, but then I was given the world’s most dreadful task…scanning, “Zzzz.” Half an hour later, at least half of it was complete but thankfully I didn’t have to do anymore until tomorrow. Result! After waking up at 6am, and returning home at 6pm, I thought “wow, I can’t believe how awake I am,” the next thing I knew it was 8am. I knew it wouldn’t last long.

That Monday Morning feeling, Work experience starts to lose its appeal

Monday, the most painful word in the English language. Just hearing it makes me want to fall asleep but nevertheless, I attended work and as soon as I arrived…I had absolutely nothing to do. The pile of scanning had already been done and the only task I had left was looking at the website to see how it could be improved. Before I did this, I met Kieron’s accountant and listened to the conversation between them about the company’s finances. I will admit, I did drift in and out, I’ve never been able to concentrate on numbers or sums for very long without noticing something more interesting and today’s distraction was Andy’s plant.  No idea what kind of plant it is, looks Japanese.

Anyway, once the accounts had been looked at and discussed, I was set the task of finding Keywords commonly used associated with HR that can attract people to the website. After getting to grips with Google Ad words, I search a number of words related to the main features of the business. To do this I looked at the website to find the main points as well as reading contracts and handbooks to pick out the main features. It was an easy task and a lot more interesting than scanning all day. I sent the document over to Kieron and then sent back a reference response to a client. Since Kieron was out all I could do now was wait.

Another short day, but I rather get everything done and go rather than sit around and watch paint dry. I’m glad I had a day without having to scan thousands of sheets of paper, needed a little break from the printer and I think the printer might agree. Time to rest before I’m back in on Thursday for another day as a work experience personnel in HR.

(Note From Kieron “The printer has now withdrawn its transfer request”)

Day 3

Yes! Its Friday which means just got to plow through today and it’s the weekend so hopefully it will be a nice relaxing day…I spoke too soon. I had been waiting for a morning like today from the very first day I started working in an office. You see the stereotypical scenarios on T.V in an office, machines braking down, IT support needed and pure panic. I use to laugh at those situations, now, I feel their pain. I arrived and was the only person in due to Kieron being in a meeting, so nice, quiet environment with music to get me through till lunch. Sounds good right, False! I was hit with the stereotypical office problems; the printer wouldn’t work, nor would my keyboard, then share point decided not to open, suddenly the internet goes down but worse of all we had ran out of milk! No white coffee for me this morning. Sad times.

Once all my typical office problems had been restored (minus the milk crisis), I got on with completing my scanning and filling in my blog as well as looking at the website to see if any improvements needed to be done. As the minutes turned to hours, I was beginning to feel alone and the boredom had become so bad, I found myself looking at pictures of ‘LOL Cats.’ All of a sudden the news I had been waiting for all morning, “I’ll pick up some milk on the way back.” The choirs were singing, and sun shone! I could finally have the white coffee I been so looking forward too.

After finally washing down my coffee, I helped try and amend a contract for a new employee. It didn’t take very long to complete but it was a learning process and with more training I may be able to complete the task without guidance in the future. Friday afternoons in an office are incredibly quiet. After completing this, I spent the rest of my time writing up my blog and listening to the witty banter between everyone around me. It was very amusing although most the time I had no idea what was going on.

It had finally come to the time to go home and sleep my weekend away. I wish everyday was like Friday, it’s so relaxing and chilled out yet very boring at some points. I don’t blame people who work in an office wanting to end half way through Friday, staring at a computer screen for eight hours a day, I’m sure I would want to hide in a dark room away from computer screens and pestering clients!  Time to relax in front of the T.V, never know might get out a book and do some research, unlikely but possible.

Don’t end up paying more when staff resign

A client of mine was just opening up her salon for the day when one of her employees came up to her and said she had been offered another job. My client was distracted by a customer who had come in early for a treatment, so when the employee offered to work her notice she just said don’t worry just finish off today if you want.

Two weeks later my client received a call from ACAS ( the government body that deals with employment disputes) saying that the ex-employee had been in touch asking them to mediate in a dispute, as she was about to make a claim for two weeks money from my client for non-payment of holidays and statutory notice.

The employee had accrued three weeks holiday but had only taken 2 weeks off and she had offered to work her notice. The problem is the employee was correct and my client had to pay up. Had my client said “Don’t worry you’ve got some holiday left just take that instead of working your notice” she may have saved herself a week’s money if the employee had agreed to take the holiday, even better she could have insisted that her member of staff take holiday if she had the right clauses in her employment contracts.

So two lesson here

1)      Make sure you have a clause in your contract that states that an employee may be required to use up any untaken holiday during their notice period.

2)      Never say “Don’t bother to come in” to an employee unless you like throwing money away!

Good news?

It’s common in blogs like these to concentrate on the problems employees cause you but this week I wanted to talk about two good experiences my salon clients have had in employing staff. On both occasions the salon wanted to hire someone for about 16 hours a week because both owners had found themselves spending all their time rushing about giving their clients an excellent service, but only found time to do the marketing and administration late at night. Ideally they wanted to hire someone full time but couldn’t afford the wages that would entail.

After a fairly disappointing recruitment campaign we approached a local college to see if they had any recently qualified students we could take on. It turned out that not only did they have the people we needed but if we took them on on an apprenticeship we could also receive a grant to help with the wage costs. All we had to agree to was that they were paid at least £2.60 an hour, and that they attended college 6 hours a week.

One student has now started and the other vacancy is being filled at the moment. Of course there is no guarantee that the new staff will turn out alright but then that’s true however you recruit them. My experience of helping my clients take on these apprentices has been so good I’m interviewing a couple of young people to be an apprentice for me this week. So we have three young people being employed. It may not be much but it makes for a good positive story to start the week.