Human Resource challenges for growing SMEs. How Flemish entrepreneurs attract, develop and retain employees

For Flemish entrepreneurs human resource management is one of the biggest challenges for further development and growth (Forum on Entrepreneurship, October 2006). Hence, this paper aims to shed light on how successful entrepreneurs in Flanders manage their human resources. Building on Greiner’s (1998) growth model and the model of Ulrich (1997), we conducted a qualitative study of various human resource practices within Flemish entrepreneurial firms in different sectors and stages of growth. We investigated the interplay between the focus of HRM and the growth phase of an SME. The main objective is to better understand the major challenges entrepreneurs experience when managing people during the first stages of company growth. Our findings suggest that HRM within growing SMEs shifts from an operational focus on people to a more strategic focus on procedures. Throughout the process of evolution entrepreneurs need to find the right balance of HR practices, paying attention to formalisation, delegation and coaching.