People Management in SMEs: Beating the Competition in Hiring

Aug 18, 2017

Recruiting the best talents has become a highly competitive activity. For this reason many organizations, in particular large ones, have been setting up active sourcing processes where they collect market intelligence, manage a pipeline of potential future hires and proactively cultivate key contacts among them.

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SME decision makers sometimes ask whether SMEs can compete in such an environment as it may lack the capacity for active sourcing, and their brand may not be as well-known as that of larger competitors. Our main recommendations are the following:

1. Active sourcing and building a pipeline is even more critically important for SMEs than for large organizations specifically because of the two questions mentioned above:

  • SMEs must use their resources even more efficiently than larger competitors and therefore they profit from active sourcing with a pipeline (instead of starting each recruiting process from scratch with no candidates in the pipeline) to an even higher degree
  • As their brand may not be as known as that of a large corporation, SMEs profit disproportionally from active sourcing as it allows them to tell their own story proactively

2. The story i.e. the organization’s ‘sales pitch’ for the sought after professional who is used to being contacted by hiring managers should not copy the arguments of larger organizations but rather emphasize the specific strengths of SMEs. Organizations of all sizes hope to attract ‘entrepreneurial’ employees – SMEs are at an advantage at this as they can generally offer a more flexible environment with broad, fluid job profiles and more opportunity for the individual to shape the business.

3. Recognizing extraordinary profiles: only few large organizations have processes in place that allow them to identify potential ‘brilliant mavericks’ who do not fit a standard profile but can be highly valuable contributors. SMEs are more suited at recognizing those opportunities due to their entrepreneurial environment and flexible decision making capability.


This article is the second in our series about people management in SMEs. After the introduction in the first instalment, and looking at recruitment in this one we will focus on further areas of people management in SMEs in each of the following ones.