Smaller firms 'are maximising employee talent'

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Employee talents are being successfully harnessed by many small firms, but some are lagging behind

Small to medium-sized enterprises (SMEs) could hold a unique advantage over their larger competitors in the UK, with new research revealing it is often smaller firms that are more accomplished when it comes to maximising the potential of their staff.

A new report from the UK Commission for Employment and Skills (UKCES) has highlighted a present gulf between the best and worst performers in terms of supportingĀ professional development.

Entitled 'Growth through People', the report assessed the efforts of UK enterprises to make best use of the talented individuals in their midst, with employers asked to give details on five key aspects of "high-performance working" - planning, organisation, skills, rewards and autonomy.

It found that companies can be typically categorised into one of seven groups - developers, freeriders, organisers, plodders, recruiters, survivors and trainers - each of which demonstrate different attitudes and characteristics when it comes to the training and development of staff.

Overall, 24 per cent of businesses were classed in the best two categories - 'organisers' and 'developers' - with firms in these areas largely demonstrating best practice in terms of planning and organising training for individuals, as well as encouraging workers to take personal responsibility for their development and rewarding them for doing so.

At present, approximately 2.2 million people are classed as working for 'organiser' businesses, while 1.6 million work for 'developers'.

However, it is at this point that some less desirable traits begin to be identified among UK employers, with large numbers of firms lagging behind in terms of best practice in the remaining five groups.

The 'freeriders' were shown to be the most common type of company in the UK at present, with around three million people employed in these firms. They were shown to be typified by a reticence to invest in the training of their own employees, instead taking on workers from other businesses that have already invested in career development for these individuals.

Companies in this category were also shown to offer low levels of autonomy for individuals, meaning staff may feel they are given little to no say on their career path and making these firms unlikely to hold on to the most talented workers in the long-term. Businesses classed as 'recruiters' also showed similar attributes in this area.

Meanwhile, 'trainers' were shown to offer good career progression opportunities for individuals but were not seen as the most desirable option for long-term employment due to a high turnover of workers.

Finally, the 'plodders' made up approximately ten per cent of UK firms and were shown to struggle in all areas, underperforming in all categories tested but failing to address these issues. These firms typically operated in the wholesale and retail sectors, and showed little inclination to reward staff.

Overall, the report revealed that while the UK continues to create more highly-skilled jobs than any other major European nation, there remains a considerable gap between those businesses that are actively delivering the training and investment necessary to fulfil these positions and those that are not.

Deputy director at UKCES Lesley Giles commented: "This research shows big differences in the ways that businesses of all sizes make use of the skills of their staff.

"Whilst it is welcome news to see many employers, and employees, finding themselves in favourable groupings here, these findings do raise concerns over the gulf between those nurturing and developing their staff to boost productivity and those that aren't."

She added that the priority now must be to highlight those businesses that are delivering the best practices to maximise the efficiency, productivity and skills of staff and help those other firms that may not be quite as adept in these areas to catch up.

With the significant growth in the need for highly-skilled staff that is taking place across the country at present, it is imperative everything that can be done to maximise the potential of the UK workforce is attempted.

Responding to the report's publication, Trades Union Congress general secretary Frances O'Grady said: "We welcome the commission's call for collaboration between trade unions, employers and the government to invest in skills for new employees and existing workers."

He added that an area where Westminster must now also seek to deliver improvements is in remuneration, as too many people are being poorly paid and this is leading to both socioeconomic issues and unnecessary strain for many households.