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Does size matter when trying to attract talent?

Jc And Ronnie

Employee selection is traditionally the match between job requirements and candidate skills. Latterly, we are seeing a common requirement from candidates that the goals and values of the organisation also match their own. Encouragingly, the results are generally that employees who fit the culture contribute more and adopt broader roles and tasks, so it's a worthwhile exercise.

But how do you get to that stage? How do SMEs get to the point of assimilating this new talent into their organisation in the face of such strong competition?

I recently completed research on talent management practice. I wanted to understand how SME marketing agencies viewed talent management, what approaches they took and what major internal or external influences shaped this view.

In the main, talent management literature has highlighted that SMEs, in comparison to larger organisations, differ in their overall approach to Human Resource Management and HR practice. Large organisations have the financial resource and corporate responsibility to employ sophisticated HR practices, investing in HR professionals and HR strategy, while SMEs, in general, have a far more informal approach, which can be used as an advantage.

My research highlighted that, in the main, SME marketing agencies have an ‘inclusive / stable’ approach to talent management.

Inclusive insofar as it involved each member of the team, regardless of seniority or role as it was felt all contributed to the overall success of the agency. And stable, because ‘talent’ was defined as a set of characteristics such as intelligence, personality, motivation, drive and feeling true to themselves which were strong predictors of future performance.

The resultant philosophy meant that training and development budgets and opportunities were spread wide and thin, across the team, and future talent was identified and selected based on a candidate’s display of a similar set of ‘stable’ characteristics. Of course, this leaves little time for real talent development and clients were all fishing for the same proven talent.

External factors that influence SMEs approach to talent management.

There are three main theories that drive the adoption of this inclusive approach - Institutional Theory, Economic Theory and Resource Dependency Theory.

Institutional Theory suggests that a need for legitimacy drives agencies to develop a culture that is attractive and has a “family feel” as a way of attracting and retaining employees.

The Economic Theory recognises talent management is expensive and can often require sophisticated HR practices and HR specialists, who rarely exist in an SME organisational structure, particularly those that have a high number of fee earning employees.

Finally, with so many SME marketing agencies dependent on clients and many viewing their clients as an attractor and part of their Employer Brand, Resource Dependency Theory is another key contributor as to why the inclusive stable talent management philosophy is adopted. With a client win, comes a need for more resource. When it is a good looking client, it is more attractive to potential talent.

The cost of employee investment, good pay and benefit packages can make it hard for SMEs to compete in the same talent pools as the larger organisations. SMEs often have less power in the market, which translates directly into less influence on price and salaries, making SMEs vulnerable to changing markets and customer needs.

The centralisation of decision making in many SMEs is focused on day to day running of the business and on how to utilise existing resources more efficiently, so talent management needs to be adapted or supported for SMEs. As SMEs grow it becomes difficult to identify key positions and the development of a talent pool to fill these positions becomes difficult, unless you have one on tap.

All is not lost however, and we see a number of our SME clients adopting strategies to overcome the resource disadvantages they have when compared to some larger competitors. Many, using their inclusive approach to talent management, have created an environment where ideas and innovation flourish, their flatter hierarchy and informal approach for example, can offer better job quality and less bureaucracy. Many agencies operate with a higher degree of flexibility, which offers people better job satisfaction, a better working environment and a better work-life balance. Smaller, can be more agile too and often SMEs can target talent from larger organisations, who want to have more control over their destiny.

Our clients tend to develop their own models which fit within their context, and that creative thinking enables them to open non-traditional recruitment channels not necessarily considered by larger organisations.

At Henry Nicholas, our success comes down to building meaningful relationships with clients and candidates. We have a proven track record of developing talent pools for a number of long-standing clients that ask us to identify and secure future talent for them.

Working in partnership, we create the additional resource our clients need to identify the right candidate characteristics that best fit a culture. We add scale to our client’s attraction and selection activities. 

View what our clients say about us here

If you would like a free, no obligation talent review, please contact John Austin for more details.