I'm an electrical contractor with twelve employees. The business is growing, so pretty soon there'll be even more people. I hear about "Human Resource Management" but what does that really mean to a guy like me?
Would you sleep easier if all your employees were dependable, consistent, top-flight performers with great attitudes that wouldn't ever quit on you? Think that's an impossible fantasy? You're not alone. Finding and keeping good employees is a contractor's No. 1 problem, but fixing it isn't rocket science. Human Resources (HR) is the family of processes that lets you hire and keep the great ones.
The good news is that you don't need to run out and hire an HR manager, at least not until you get up to around fifty employees. You do, however, need to set up, document and use a few basic HR processes.
Job Descriptions: For every job, specifically detail the required results, what activities will be performed to get those results, performance standards and how they'll be measured.
Hiring: For each job, what qualifications are required? What's the procedure for sourcing candidates? What's on the application? How many are interviewed? Who interviews? Which interviewers are assigned which questions? Who calls to set things up? (More than you had in mind? Remember that the more thorough you are before the hire, the fewer headaches afterwards. There's nothing more harmful and expensive than a bad hire.)
Compensation and Benefits: What jobs get paid how much? How often do raises occur? How big are they? Based on what? Who decides? What benefits do you offer (vacation, sick leave, insurance, etc.)?
Performance Appraisals: This is a detailed, structured, annual process that requires preparation and effort, not a twenty minute chat at Taco Bell when or if you get around to it.
Company Policies or "The way we do it here:" How are customers greeted? Who does what if there's an emergency? How is the phone answered? From whom do employees take directions? Is profanity okay? These are things you expect all your people to do, regardless of their particular job.
All of these things need to be printed, put in a booklet or binder and given to every employee. When policies or processes are updated, distribute new pages and have employees update their manuals.
A lot of work? Could be, but unlike the high-turnover merry-go-round where you're constantly hiring and retraining, your systems development is work you do once and it pays you back forever. Besides, you have most of this stuff in your head already. It's mostly a matter of getting it onto paper.
I talk a lot about documentation because it's absolutely critical for creating consistent results and for allowing you to delegate tasks to others. If your proven "best practices" are written in operations manuals, you can tell employees to follow the book. If not, they'll do it ten different ways and be after you with a million questions. The same idea works in every area of your business. (More on that in later articles.)
If you have employees, you're already a HR Manager whether you like it or not. If you're doing it on the fly without tools and training, your results can be frustrating and expensive.
Fortunately, because we teach contractors these techniques every day, I can tell you that while you won't eliminate turnover and bad hires completely, there are simple, proven methods that'll let you be comfortable wearing your HR hat and let you sleep better at night.
Construction Business Owner, August 2006