Entrepreneurship and Human Resources
Entrepreneurship and Human Resources
Through many years of working with entrepreneurs, the thing most likely to bring success to a sudden stop is the lack of attention to the area of human resources. Despite the fact that people costs of the growing business are the biggest single expense, very little attention is paid to this area until the entrepreneurial train hits the buffers.
Whilst I can see why this happens, it is still an inexcusable error by the would-be entrepreneur. When the business first starts there are usually only a small number of people involved and they are usually highly committed to the new venture and interact on a daily, and often hourly, basis. However, as the business grows so does the number of people. Moreover, newer employees are more likely to join because they want the job rather than because they have the evangelistic zeal of the entrepreneur. Add to that the increasing difficulty of communicating with a larger group and human resources is now a time-bomb waiting to explode in the entrepreneur's face.
Unfortunately, by the time the entrepreneur is aware of the problem, the cost in money and time of correcting this big hole in the master plan will be far more than had it been included in the beginning. Entrepreneurs understand clearly the need for a business plan, a marketing plan and a financial plan and yet most do not have a good human resource plan.
Some of my experiences of this have been truly astounding. In 2009 as part of a consultancy to implement good human resource practices in a 150 person company in Turkey I facilitated the first formal managers meeting with a clear agenda for forty years. Until then all communications had been carried out either in the dining room or when people passed each other in the factory. As a consequence miss-communication was costing the company more money than the size of their bank loan.
In a second company in Turkey, although there was a wonderful organisation chart in a desk drawer, in reality everyone reported to the chief executive resulting in him wasting most of his day with silly little queries.
Worst of all was a business in the UK that only admitted that they had a human resource problem the day that they received a formal notification of proceedings through an industrial tribunal for bad human resource practices. This was not because they were a bad employer but because they did not give human resources the correct attention.
So, in order to try and keep others from a similar fate, here are my top tips for managing human resources.
Make sure that, parallel to your business plan, you produce a human resource plan to support it.
Before you employ anyone make sure you have a documented job description and person description. The first of these will tell you what you want the person to do and the second will tell you what type of person you require.
Always consider whether you really need the person long term or whether there are other ways of getting the work done. Too many companies deal with a crisis by hiring and then when the crisis is over they find themselves paying for someone with nothing to do.
When hiring, if you don't get the right person first time around, go around the loop again. Don't take second best.
When drawing up an organisation chart make sure that titles also have responsibilities associated with them. A person cannot be called a manager if they do not have the responsibility and accountability to manage those beneath them.
When hiring people, make sure that you pick people that believe in your product or service. That remains true from the top to the bottom of the organisation. A telephonist that does not believe in the product or service is capable of damaging your business.
Make sure that you hire people that are smarter than you. If you hire people less smart than you then they will do the same. Soon the company will be full of the least able people!
Make sure that you employ people that want to be developed. One organisation in the UK, called Talent, believes that we are all like icebergs with most of our potential not showing. This company will offer any job to the first person that walks in the door provided they commit to a development programme.
Once you have your employees make sure you have policies and practices to manage, develop and appraise them. Getting the right person is a hard job so it is worth putting in the effort to keep them.
Remember that people are a key resource and not an ego trip. Businesses are measured in terms of profitability, not in terms of the number of employees. One business I know has had a workforce that has fluctuated constantly between 2 and 25 employees. Strangely the profitability, or lack of it, has never altered!
This last tip is here for a very good reason. It is to remind you no subject has exactly ten top tips! Don't think that following these tips will solve all of your problems but they will give you a good start.
Roger is an international business consultant who specialises in working with SMEs and SME support organisations. He has particular skills in Entrepreneurship, business incubation and business centres. He is an outstanding speaker and media perasonality.
“I want to break free” ? the WHY of entrepreneurship
Ok, so you've come to a point in your job where you're saying (if only in your mind) – "That's it! I've had it! I'm outta here!"
What is the right motivation to make the jump from employee to entrepreneur?
This article aims to raise key questions to assist you to make the right decision for the most important person in your life – YOU!
Why?
Why would anyone want to start their own business?
The reasons why not to are all there for anyone to see – just doing an internet search on ‘why businesses fail' and you'll find 50,000+ reasons to be concerned.
And yet……. people are still doing it. So why?
This is where you get to begin the process of being in control of your life. You get the chance to ask yourself the questions and be able to answer them in the complete privacy of your mind.
Questions to help identify the "Why":
Why do I want to break free? (Is it because you hate your boss, job, Mondays?)
How do I feel about my current job, home, car, relationships, etc? (Is this the life you pictured for yourself?)
Do I want more than that?
If so, what do I want to achieve in the next 6 months, year, 3 years, etc?
Will doing what I am currently doing allow me to achieve these things?
Am I prepared to ‘do what it takes' to make a business succeed?
Am I willing to invest in my business? (Every legitimate business, no matter how small requires some form of investment, both time and money.)
If I need to learn new skills, ideas, etc to succeed – am I willing to do it?
What's next?
So, you've answered the questions and ….
You've decided that starting a business is not for you. Or you've made a decision just to change jobs. Or you've decided that you really do like your job.
Good for you! Entrepreneurship is not for everyone.
Or ……
You've decided that doing what you are currently doing will not get you to where you want to go. You've decided that you want more. You've decided that you're willing to find out for yourself.
Good for you! You have now taken one of the most critical steps in making your break for freedom.
I run my own business assisting people who are serious about making a change, who are self-starters and are motivated to create an abundant LIFESTYLE.
Entrepreneurship and Economic Development
Entrepreneurship plays an important role in economic development of any country. Both are closely and positively linked together. The idea about this relationship has made its way since early works of Schumpeter (1911). Entrepreneurs with their skills and innovative activities brings growth for their firms and which in turn helps in developing economy for their countries. This makes us to believe that an increase in number of entrepreneurs means an increase in economic development.
In his book Schumpeter has described innovative activities as "the carrying out of new combinations". Here are the five combinations presented by him (Schumpeter, 1963 (1911), p. 66) -
The introduction of a new good – that is one with which consumers are not yet familiar – or of a new quality of a good.
The introduction of a new method of production, that is one not yet tested by experience in the branch of manufacture concerned, which need by no means be founded upon a discovery scientifically new, and can also exist in a new way of handling a commodity commercially.
The opening of a new market, that is a market into which the particular branch of manufacture of the country in question has not previously entered, whether or not this market has existed before.
The conquest of a new source of supply of raw materials or half-manufactured goods, again irrespective of whether this source already exists or whether it has first to be created.
The carrying out of the new organization of any industry, like the creation of a monopoly position or the breaking up of a monopoly position.
Through these innovative activities, entrepreneurs creates new profit opportunities. These opportunities can be a result of increase in productivity, in which case, their relationship to economic development is quite clear. Moreover, the atmosphere created by the entrepreneurs helps in building favorable ground for additional innovations and profit opportunities. Therefore, more entrepreneurs means more development, which in turn leads to more entrepreneurs and this process is self-feeding.
Reference:
Schumpeter, Joseph A. (1911): The Theory of Economic Development. An Inquiry into Profits, Capital, Credit, Interest, and the Business Cycle. Translated by R. Opie, and Published by Oxford University Press (1963).
AB Shah is a Software Developer based out of Charlotte, North Carolina, United States.
Small Business and Entrepreneurship – Building your own!
In almost every place in the world now, recession has been a well known problem. Most people are searching for an alternative income to be able to sustain their daily needs and their family as well. In my own point of view, it will be a big help and really much better if people will have their own business to grow and take care of. It does not necessarily mean that it needs to be a big business, a small business will do. Who knows that small business can be big someday? With hard work and perseverance, everything is possible.
When you build your own small business or start entering the entrepreneurship world, the best thing to start is what you love to do. I always believe that as long as you love what you do then you can be successful, because there is that certain motivation of doing your best in that field. You will not get bored or somehow feel frustrations because you love the business that you have, you love the concept of it.
Start investing in an amount that you can afford to lose. I’m not saying that you have to think negative that you will just lose the business but then it will be better if you will think of all sides of it. You have to think of what will happen to you if the business goes ok or if it goes down. Think of the advantages and disadvantages. Everything the can happen to you business.
Starting from a small business and entrepreneurship can lead into a big bang business in the near future. Nothing to lose if you will try. You will definitely gain experience and knowledge that you can use in the long run.
Entrepreneurship Is About Seizing Business Opportunities
Innovation is one of the major driving forces that lead to personal financial freedom. If today you were to find a way to touch people's lives, you'll definitely get inside their wallets. Business opportunities are all around us but it's only those who are observant and alert seize these chances to make money.
Today allow me to write about the art of entrepreneurship. It involves the skills of generating a business idea and turning it into a business opportunity. Besides being self employed, generating a business idea is the very first step in becoming financially independent. It may involve listening to what people say and identifying an unsatisfied need then taking initiative to start a business and fulfilling that need.
Entrepreneurship is accepting investment risks and seizing a business opportunity to implement a prospective business idea. This is based on a business owner seeing the possibility of success in a particular project. In simple terms, it's a chance which can be exploited by selling a product or service at a profit.
Carefully observe your neighborhood and you'll identify a business opportunity. With the current economic hardship, people must seek to start up their own small business to supplement their income. Then from there set up sound management systems to ensure that these businesses prosper.
It is also advisable not to stick with one income stream, but have several income channels. There are good and legitimate online businesses that one can invest in as part time. So don't depend entirely on employment but instead have a fall back plan just incase.
Belsheba contributes her experience in online business development, tips that will help you make money online. Website: Business Ideas And Tips to improve your Business.
