Every business needs to focus on developing its workforce to succeed. But if you are a small and midsize business owner, you face distinct challenges when it comes to talent and skills. Having a responsive HR strategy can be used as springboard for growth.
SAP’s monthly TweetChat, #SAPSMBChat, is a discussion designed to help entrepreneurs and small or midsize business owners build a simpler path to growth. Our August TweetChat featured the guest SuccessFactors, an SAP company, and leader in cloud human resources technology during the SuccessConnect 2015 conference #sconnect15. Our co-host was Brian Moran, an expert on entrepreneurship and the SMB marketplace,.
The topic for our chat was How a Responsive HR Strategy Can Be A Springboard For Growth. We focused on challenges related to employee skill and engagement, how to use HR to achieve better financial results, and the importance of preparing for the future workforce. Below is a transcript of our conversation with SuccessFactors.
SAPSmallBiz: How can problems with talent and skills affect business performance?
SuccessFactors: If you don’t make employee engagement a priority, you will have low productivity, which is not conducive to growth! A better-prepared workforce delivers better results. If you don’t invest in training and development, employees can’t thrive. Underperforming companies are more likely to downsize instead of rethinking how to make human resources a strategic priority.
SAPSmallBiz: How does a strong HR strategy drive better financial results?
SuccessFactors: Companies with above-average revenue growth are more likely to provide employees with advanced training and development programs. High-growth companies are more likely to adapt business models and HR strategies in response to market opportunities.
SAPSmallBiz: What kind of benefits should companies provide employees if they want to perform at a high level?
SuccessFactors: Competitive compensation, flexible schedules, and healthcare top the list! Over 50% of high-performing companies offer supplemental training, which is significantly more than underperforming companies.
SAPSmallBiz: How can HR and other business data insights help companies position themselves for growth?
SuccessFactors: High-growth companies are more likely to explore how insights help align employee performance to business objectives. Over-performing companies are more confident about their talent and business data insights. When it comes to HR and business data, what you don’t know CAN hurt you! Understanding performance analytics can deliver extraordinary sales results.
SAPSmallBiz: Preparing leadership for the future is critical for growth. Which learning and development strategies work best?
SuccessFactors: If leaders aren’t prepared for the future, the companies they run will be outmaneuvered in the marketplace. Beware: Research shows that low-performing companies overestimate leaders’ abilities.
SAPSmallBiz: Which workforce needs do low-performing companies struggle with most?
SuccessFactors: Low-performing organizations are more likely to have difficulty finding employees with base-level skills. There is a major technology skills gap between high-revenue growth companies and low-performing organizations. Low-growth organizations struggle finding talent with programming, analytics, and digital media skills.
SAPSmallBiz: How should companies factor Millennials into their HR and workforce strategies?
SuccessFactors: If you want to position yourself for growth, you need to plan for the new face of work: Millennials. By 2025, Millennials are predicted to make up 75% of the workforce! 61% of high-performers see Millennials impacting workforce strategy, versus 51% of low-performers.
SAPSmallBiz: Can an emphasis on employee development affect a company’s growth and performance? If so, how?
SuccessFactors: 71% of high-performing companies consider workforce development a driver of competitive advantage, while only 46% of underperformers think the same. 89% of high-growth companies say workforce development is a key differentiator for their firms, while only 51% underperformers agree with that statement. 58% of high-performing companies have mentoring programs for employees, but only 50% of low-performers have similar mentoring programs.
SAPSmallBiz: Last call! Any final advice for companies on how to use an HR strategy for growth?
SuccessFactors: Preparation for the future workforce requires that workforce issues be visible and actionable priorities in the C-suite. To catch up to high-performers, underperforming companies must focus on making HR a strategic priority!
Want more on future-focused HR strategies? See The Future of Human Resources.