The Only Way is Up!

For those who remember Yazz’s hit from the summer of 1988, you might find yourself singing along. It could very well be the UK government’s aspirational theme tune for the much-needed boost in productivity.

While many small and medium businesses had ambitious plans for growth in 2025, spiralling costs and uncertainty have already begun to stall development and recruitment efforts. At the same time, there is a lack of investment in new skills despite the opportunities presented by innovation, emerging technologies, and generative AI. Instead, redundancies are on the rise in numerous sectors — hardly a recipe for growth or productivity.

In Yazz's words, many business owners may feel the urge to "hold on" and look forward to a "brighter day" even though, as she says, “things may be a little hard now.”

But as we all know, the only way is up.

Macro Government Plans for Productivity vs Micro Realities for SMEs

Achieving that 'brighter day' will be a significant challenge for many SME business owners, who must grapple with the micro realities of increasing National Insurance contributions and rising minimum wages. Proposed changes to employment laws, including enhanced unfair dismissal rights, will increase both costs and the risk of employment tribunal claims. Additionally, the time frame for employees to bring a claim to be extended to six months will heighten anxiety for business owners.

If this weren’t enough, the government’s plan to introduce statutory sick pay from day one of absence — fully funded by businesses — will further stretch SME resources. For many, these changes will only exacerbate their challenges with tight margins.

So, What Can SMEs Do?

With a shift towards improving employee rights and protections, businesses must find ways to adapt. As an HR professional, I firmly advocate for good people practices. The evidence is clear: Businesses that prioritise enhancing the employee experience — through better leadership, greater empathy, and meaningful work with a clear purpose — will see higher engagement and productivity. This, in turn, drives business success.

Moving up the HR/People Curve and adopting a more strategic approach will enable businesses to improve performance and productivity. Having led a small business for over 18 years and supported hundreds of business owners with HR advice and guidance, I understand the real-world challenges SMEs face. This experience contrasts sharply with my time in corporate life, where large teams of specialists are the norm, while SME business owners often have to wear many hats.

Yet, a strategic approach to HR and people practices, aligned with business goals, is often overlooked in SMEs.

Where Is Your Company’s HR Approach from 'Compliance to Strategic'?

Compliance: For many SMEs, HR is still viewed primarily as a cost-centre, where businesses focus on compliance — meeting legal requirements such as issuing contracts of employment, GDPR obligations, and having the necessary policies in place. While this approach ensures businesses avoid legal pitfalls, it won’t be enough in today’s or tomorrow's competitive environment.

Attracting and retaining top talent is becoming increasingly challenging, and companies focusing only on compliance people management risk falling behind. They’ll miss out on the benefits of a more people-centric approach to business that drives engagement, productivity, and profitability.

Good Operational HR/People Practice: SMEs that invest in operational HR practices—such as management development, mental health support, and enhanced employee benefits—often see improved employee engagement and productivity. However, these practices can sometimes be ad hoc or disconnected from broader business strategies.

Strategic HR: Larger companies have long developed comprehensive People Strategies that align HR initiatives with business goals. However, many SMEs (especially smaller ones) often lack the in-house HR expertise to take a strategic approach or the resources to invest in professional strategic-level HR support. A People Strategy fully integrated with business goals, appropriate for an SME can align efforts and drive better outcomes across the company.

Do You Want to Learn How to Take a More Strategic Approach to People Management?

If this resonates with you and you want to learn how to transform your approach to people management and drive your business upwards, then see below.

Fully Funded Leadership Training – Nothing to Pay and a Free Lunch!

If you are a business owner, leader, or in-house HR professional in Greater Manchester, you can apply for a place on the highly rated fully funded leadership event,

‘Smart Changes, Big Results – Organisational Development through Your People’ leadership event

Funding by Greater Manchester Business Growth Hub.

I will be delivering these insightful and practical HR events for The HR Dept Greater Manchester franchises.

Choose from one of the training events to be held on February 6th and 10th 2025.

These events are designed to help you take a more strategic approach to people management, boosting your business performance. Big company thinking applied appropriately for smaller businesses.

What’s covered:

• Understanding the importance of purpose, vision, and strategic aims
• The latest best practices and addressing challenges in people management for SMEs
• How to develop an integrated people strategy that aligns with your business goals
• Practical techniques you can apply immediately
• Small group sessions with shared learnings, including relevant case studies

Some of the comments from previous delegates

“The course was very insightful”

“I came away with a huge action list”

“I would recommend the course for those looking for some inspiration as we go through these testing economic times”

“It was an opportunity to strategically think and share best practice with other leaders and get expert guidance”

“The takeaway was when we think of the WHY; we can reach the FOCUS”

“A clear People Strategy is crucial”

“Highly recommended course, we would certainly advise companies to step OUT of the business for 1 day to work ON the business and see some results”

Limited spaces available.

Apply now and for further information:

https://www.hrdept.co.uk/trafford-and-warrington/training-and-events

?