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Finding the "right staff" in small firms

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Purpose ‐ The purpose of this paper is to explore what owners of small firms are looking for from new employees. The aim is to pursue this in light of the debate around formality and informality of small firm HRM, exploring the extent to which the small firms studied had formalised HRM practices. Design/methodology/approach ‐ The data reported here were collected in discussions with the owner(s) of 27 small firms in the Latrobe Valley region of South East Victoria, Australia. These firms were participating in the federal government-funded small business assistance program and data were gathered through a series of visits and discussions with the owners over the period of the assistance program. Findings ‐ It was found that in those firms where they had formalised HRM practices, which linked directly to their strategy, employers were more able to "sell" their vision for the business to potential employees. Research limitations/implications ‐ Research has shown that there is a positive relationship between small firm growth and the formalisation of HRM policies. However, this paper is based on discussions with people who were taking action to acknowledge and address issues affecting their business and so their experience may not be generalisable to other small businesses. Originality/value ‐ This paper makes an original contribution of exploring the area of HRM in small firms and is hopefully a reminder to small business owners that HRM issues and small business advisers can play a critical role in the structure of their HRM practices ‐ helping them to decide whom they want to recruit and how to go about it.
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Keywords: Australia; Business improvement; Human resource management; Small enterprises

Document Type: Research Article

Publication date: 27 November 2007

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