Sustaining growth – the HR dimension HR practices and management and leadership skills of High Growth SMEs

ERC Insight Paper

Associated Themes
  • Management and Leadership
  • Productivity and performance

This research set out to investigate human resource management (HRM) practices and leadership behaviours in UK SMEs that represent a small proportion of firms to have achieved long-term growth. We interviewed 30 senior leaders of such SMEs and found that most leaders espouse key high performance work practices such as selective hiring, employee development, open communication, and, to a varying degree, performance management and employee participation. Through flexible informal practices, SME leaders tap into employee’s intrinsic motivation to enhance performance and to develop personal trust and reciprocity. Overall, our research paints a picture of HRM in growth-oriented UK SMEs as a complex phenomenon where a number of formal and informal HR levers interact, guided by a compelling vision, and creating a positive company culture in the process.