Human resource acquisition in small and medium size enterprises (SMEs) [Virtual presentation in English]

Abstract

It is easier to replicate technology than to replicate the unique combination of individuals employed within the organisation. In SMEs this is even more crucial because each employee constitutes a larger percentage of the total workforce. Given the considerable importance of ensuring that the right blend of people is employed in an organisation, the recruitment and selection of employees is of strategic importance to SMEs. Only a handful of research studies have ever been conducted on recruiting and selection practices in SMEs. By comparison, numerous studies have been conducted on recruiting practices in large well-established organisations. This study attempts to fill this gap, by examining and reporting the results of a national survey on the prevalence of recruitment and selection practices in SMEs (N = 1435). It further examines the impact of demographic factors such as organisational size, the presence of a HR manager and the existence of a strategic plan on recruitment and selection practices in Australian SMEs. The results revealed that SMEs used a combination of internal and external sources and methods for recruitment. Recruitment practices were significantly more prevalent in medium-sized enterprises; where a HR manager was employed; and where a strategic plan existed. A similar picture emerged regarding the relationship between the prevalence of selection practices and these demographic variables. A greater understanding of recruitment and selection practices may lessen the frustration that SME owners experience as the result of wrong selection decisions. The significance of this study lies in the reality that SMEs need strong resource acquisition practices to ensure their growth. Recruitment and selection is a major part of this and forms the foundation for all the other HRM activities.