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Why Every Small Business Needs a Proactive HR Department

By Jori Hamilton

Proactive HR Department

Image Source: Pixabay

February 18 2022 - Whatís one thing most small business owners arenít thinking about in the beginning stages of their companies? There are so many answers to this question, but if you said: "Putting together a Human Resources department," weíre on the same page.

The first five years of most small businesses are primarily dedicated to staying afloat and turning a consistent profit. Things like human resources take a backseat. And sometimes, that works out for small business owners because theyíre lucky enough not to encounter any significant employee, workplace, or customer issues.

However, the need for an HR department arises for many because something terrible happened that an HR department couldíve prevented. The damage done to the entire business usually prompts company leaders to piece together an HR team that can hopefully avoid any such blunders in the future.

A proactive HR department could be the difference between a thriving company and a starving one. Hereís more on why every small business needs a proactive HR department.

Streamline the Recruiting and Hiring Processes

Big companies spend a fortune on recruiting and hiring, but for a good reason. Itís an incredible value when you have access to top talent and the resources to keep them on your team. Unfortunately, with that being said, most small businesses donít have the financial means or resources to put together a recruiting and hiring strategy that gets results.

Investing in an HR department can help you streamline your recruiting and hiring processes. You will have professionals on your team with experience connecting with potential candidates and leading them through a hiring process.

Additionally, a proactive HR department will look for creative ways to build recruiting and hiring strategies that fit your companyí s budget.

Also, a proactive HR department can help create an onboarding system.

Create a Dedicated Onboarding System

Onboarding is one of the most critical experiences a new employee will have with your company. Unfortunately, most small businesses recruit and hire an employee but donít have a process for ensuring that the employee settles into the team and their new role.

When a new employee has a hard time in the first few weeks of being hired, it increases the chance of leaving the role and your company prematurely. On the other hand, if you guide new employees through the first 30-90 days of their employment, theyíre more likely to see themselves with your company long-term.

A dedicated HR team can assist a small business in coming up with a comprehensive onboarding system that ensures new employees:

  • Are properly introduced to existing employees
  • Have all tools, software, documents, and so forth that they need to excel in their roles
  • Are aware of all resources available to them
  • Understand workplace and HR policies
  • Have a list of contact information for everyone on the team
  • Are appropriately integrated into the company culture
  • Understand their tasks and projects for the first few months of employment
  • Understand what management expects of them

Aside from recruiting, hiring, and onboarding, an HR department is incredibly helpful with business finances.

Keep Business Finances in Good Standing

Some of the most significant mistakes small businesses make have to do with money. For instance, many small business owners mix their personal and business funds, fail to make a business budget, or donít grasp how to properly use credit cards and loan funds to boost their businesses.

Fortunately, you can avoid the above mistakes with a dedicated HR department. Even if you simply start with one HR employee, they can help you with bookkeeping, paying business bills, taxes, and monitoring how and when you spend money in your business.

Next, every small business needs a proactive HR department to protect and support its employees.

Protect and Support Employees

One of the main functions of an HR department is to protect and support employees. Your employees may feel a lot better about working for you when they know thereís an entire department advocating for them.

A proactive HR department can help you develop detailed HR and workplace policies that keep your business and its workers safe. For instance, aside from maintaining employees' physical safety, small business owners must also ensure their online spaces are safe and secure.

An HR department can prioritize data security in the workplace by creating policies that warn employees against sharing passwords, using generic USB drives that arenít encrypted, and leaving computers and company devices unattended.

Another reason every small business needs a proactive HR department is to provide a better customer and client experience.

Provide a Better Customer and Client Experience

Small businesses rely on loyal customers and clients. Without them, small business operations wonít survive, let alone thrive. A strong HR department can help you provide a better customer experience in a couple of ways:

  1. HR often works directly with customers and clients. Their direct interactions with your customers play an integral role in how they experience your brand and continue their relationship with your business.
  2. As stated above, one of HRís primary roles is to take care of your employees. When your employees are adequately supported, theyíre usually much more engaged and productive in their roles. And when your employees are at their best, they do the best for your customers and clients.

Ultimately, when you have an HR department that takes care of its employees, those employees will take care of customers. Your HR department also has a direct hand in customer and client relationships that furthers your businessís bottom line.


This is just the beginning of a long list of why every small business needs a proactive HR department. Although there may be some additional costs associated with bringing on HR personnel, those expenses are worth it for all that the right HR team can bring to your business.

About the author

Jori Hamilton

Jori Hamilton is a freelance writer residing in the Northwestern U.S. She covers a wide range of subjects but takes a particular interest in covering topics related to business productivity, recruitment, HR, and marketing strategies. To learn more about Jori, you can follow her on Twitter and Contently.

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