Asure, a U.S.-based provider of cloud-based Human Capital Management (HCM) software, has released its annual HR Benchmark Report, revealing that strategic HR practices are pivotal in driving small business growth.
The report, which surveyed over 1,000 small and medium-sized businesses (SMBs), compares HR practices between fast-growth and zero-growth companies.
The report identifies eight critical HR practices: recruiting and hiring, benefits, onboarding, development, compliance, retention, performance management, and post-employment practices. It shows that companies prioritizing these areas significantly outperform their peers.
Strategic HR as a growth driver
The survey results indicate that fast-growth companies implement HR best practices more consistently, with an average adoption rate of 83%, compared to 64% among zero-growth firms. This strategic approach to HR correlates with higher business performance and growth.
Importance of benefits
Competitive benefits, such as 401(k) plans and wellness programs, are essential for attracting and retaining top talent. According to the report, 74% of fast-growth companies offer a 401(k) plan, compared to 50% of zero-growth companies. Similarly, wellness programs are provided by 74% of fast-growth businesses, against 38% of zero-growth firms.
Effective onboarding
A structured onboarding process is critical for employee retention and productivity. Fast-growth companies are more likely to have formal onboarding programs, comprehensive checklists, and orientation processes, which reduce early employee turnover.
Commitment to development
Investment in employee development distinguishes fast-growth companies. These businesses offer regular training, leadership development, and opportunities for employees to enhance their skills. The report shows that 80% of fast-growth firms adhere to best practices in employee development, compared to less than half of zero-growth companies.
Compliance and risk management
Ensuring compliance with federal, state, and local laws is essential for mitigating risks. Fast-growth companies prioritize compliance, which reduces the likelihood of costly legal issues and promotes a stable business environment.
Asure’s 2024 HR Benchmark Survey included over 1,000 SMB respondents who answered 40 yes/no questions about their HR practices. The survey results highlight the correlation between HR best practices and business growth, providing actionable insights for SMBs looking to enhance their HR strategies.