The When and Why of Hiring an Effective Human Resources Manager

TEC Worldwide is an international organization of more than 7,000 business owners, company presidents and chief executives. TEC members meet in small peer groups to share their business experiences and help one another solve problems in a round-table session. The following questions and answers are summaries of recent TEC meetings in Southern California.

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Q: I run a small, rapidly growing company. Lately, we seem to be running into “people problems,” particularly concerning the administration of compensation and benefit plans. When is the right time to hire a human resources manager and what skill sets should I look for?

A: Experts recommend one HR person for every 100 employees, but that number can vary depending on the sophistication of your employees, the relative complexity of your benefit structure and how you deliver those services to your employees.

Manufacturing or distribution firms often can put off hiring an HR manager until they reach 200 employees. On the other hand, high-tech firms, because they tend to have more sophisticated employees and complex benefit plans, may need an HR person long before reaching the 100-employee mark.

Just as important as knowing when to hire a human resources manager is knowing why. The HR function has two primary responsibilities: to help you develop policies and procedures for managing your work force, and to educate and train your managers and supervisors to implement those policies and procedures in a consistent, effective manner.

When properly deployed, the HR function performs a strategic role that helps you and your management team increase your effectiveness in managing your most valuable resource--your employees.

Common sense and fairness are the two most important traits for HR managers, says Karen Jorgensen, president of Jorgensen Human Resource Solutions in La Canada. Those traits are vital because HR managers must be able to consider a wide range of perspectives and come up with fair and equitable solutions.

HR managers also need a solid foundation in basic business principles and a good understanding of how the HR function supports other elements of the business. Smaller firms should look for someone with two to four years of formal HR experience (preferably at the supervisory level) or a degree in human resources and some on-the-job experience.

Often, the best small-company HR managers come from larger companies and can bring their experience, procedures and expertise with them to help the smaller organization grow. If you hire a candidate from a large company, however, make sure that person has hands-on experience doing the work and not just supervising others.

A final note: Regardless of the size of your company, the HR person should not do payroll. There’s no reason not to out-source that function.

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Q: I come from the old school of business, so I confess to some delight in seeing so many of these dot-com companies getting their comeuppance. At the same time, I’ve been around long enough to realize that the Internet isn’t going away. So, what is the secret to a successful Web site? How do you make money on the World Wide Web?

A: To succeed on the Web, says Ken Sethney, president of the Sethney Group in Laguna Beach, focus on the strategy first and the technology second.

Whether they are in consumer retail or industrial marketing, successful companies understand that doing business on the Internet is not just about using the latest technology, it’s about delivering value, getting paid and earning a return on their investment. In short, it’s about doing business.

Before making any decisions about doing business online, ask yourself a few key questions:

* What business problems can I solve online?

* Who can I solve them for?

* How much will they pay me to solve them?

* How will I measure success?

If your answers make sense from a business standpoint, you may be on the right track. If not, find a new set of answers or don’t go online.

Keep in mind that, depending on how you measure success, your Web site doesn’t necessarily have to generate revenue. At the minimum, however, it should generate profit through cost savings or increased productivity.

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If there is a business issue you would like addressed in this column, contact TEC at (800) 274-2367, Ext. 3177. To learn more about TEC, visit https://www.teconline.com.