Your people risks and how to manage them
You can put all the main safeguards of risk in place, but people make the magic happen. And if people are not feeling particularly magic about your business, all of the de-risking strategies you’ve put in place could very easily go wrong.
If your employees don’t care enough, they won’t notice or perhaps even care where vulnerabilities for your business may lurk. From not mopping up a spillage to not caring if a delivery is not made on time, however big or small the risk, the people in your business are one of the biggest risks of all.
But, saying that, the people in your business can also be the most important guardians that your business has… if they have reason to be, of course.
What are the biggest people risks that small businesses face?
The biggest people-risks fall into two distinct areas:
The tangible elements (documents, systems etc.) that you would be foolish to overlook or are legally obliged to ensure are in place; and the less tangible elements that can make the difference between surviving or excelling as a business.
So, for the tangibles…
- Do the people you are hiring have the right to work in the UK and can you evidence it?
- Do you have the necessary liability insurance in place?
- Are you issuing fully compliant written statements of employment within two months of them starting work?
- Are you paying at least minimum wage and relevant statutory benefits?
- Are you offering a pension to eligible staff?
- Are you ensuring the health and safety of your employees, in relation to working time, environment, equipment etc.?
- Are you handling their personal data in a way that is secure and compliant with GDPR?
- Are you sure your casual workers aren’t really employees?
Failing to have these basics in place not only risk a financial penalty for your organisation, but can also damage your reputation and ability to hire people of the right calibre.
Although not legal requirements, there are other basic documents and systems that are invaluable to have, regardless of the size of your business. For example…
- Do you have a staff handbook or similar resource for setting out your ways of working and ‘rules’?
- Do you have an effective recruitment process in place that ensures you aren’t ‘hiring in haste’ or failing to undertake good due diligence checks on a potential employee?
- Is there a process in place and sufficient time set aside to ensure new employees are properly inducted into their role and the business to maximise their chances of success?
- Are you recording and acknowledging employee absences, so that patterns can be spotted, support offered or areas for concern fairly and consistently managed?
- Are your jobs designed and ways of working supporting people to perform of their best?
- Are processes in place for addressing performance concerns and ‘nipping issues in the bud’?
And now for those game-changing but less-tangible ones…
- Are the core aims and values of your business understood internally?
- Is there a clear ‘line of sight’ between an individual’s job and what the business has set out to achieve?
- Are your people managers confident and capable to lead their teams?
How can they manage these risks?
To manage the tangible risks, you must ensure you have the legal basics in place for hiring and employing people.
Avoid false economies by trying to create these all yourself, and get support from an expert. Few elements of running a business are more stressful than the people bits, particularly if you don’t have the necessary systems and safeguards in place.
Less tangible, but no less significant, you should ensure you promote a sense of purpose in the workplace.
It not only helps employees feel connected to the business they are working for, but it also helps to minimise the risk that they focus on tasks that are less important to your organisation’s success, and are de-motivated and unproductive as a result. It is also critical for building trust and a sense of integrity, demonstrating that the business ‘lives its values’ so that the internal experience matches the words.
As for your managers, it is all very well being technically proficient, but that doesn’t automatically translate into being good at managing people.
To avoid the very costly risks of low morale and high turnover through poor management, you should invest in yours and your other managers’ development. If you have engaging managers who provide clarity, appreciation of effort and with the confidence to deal fairly and effectively with their teams, then you will see improvements in performance, productivity and retention.
Finally, to avoid the risk of hidden problems and unspoken concerns, you need to create a working culture and systems of communication that ensure employees feel they can voice their ideas and be listened to.
This needs to be both about how they do their job and in decision making within the business; with joint sharing of problems and a commitment to strive towards joint solutions.
Effective employee voice recognises your staff as legitimate adult stakeholders in the business; key to and a part of its success. It can make the real difference between someone ‘going through the motions’ or feeling connected to and striving for the success of the business.
At Heptagon HR we are passionate about businesses getting the people bits right and achieving or exceeding their business objectives through good people management.
Heptagon HR uses its considerable HR, business expertise and resources, to work with organisations to help them reduce their people risks and achieve greater business success, through effective employee systems, management and engagement