The Yarn Bazaar has started a web series for textile sector to offer insights and management mantras to texpreneurs. The mission behind this is to inspire and guide business owners and young entrepreneurs.

The first one is on one of the most common area of concern:
HR Practices for SMEs

Below is a youtube video link of the web conference organised by Mr. Sharad Tandon (Standon Consulting) and delivered to texpreneurs group on 7th April 2020. It was conducted by Mr. Rajiv Misra from R Square Consulting.

Textile Value Chain brings to you the transcript of the same.

• Misconception about HR : hiring people and payroll management
• HR is people, process and systems.
• At the start of a new business, the founder is a one man army handling everything from operations to finance.
• It becomes difficult for owner to manage hr when no. Of employees cross 20 people or if the business topline crosses 25 crores.
• Without hr, owner is stuck between people problems and business problems
• You save 25% of your time by setting up employee policy framework.
• What the employees want to know upon joining: organization culture, compensation, growth opportunities.
• Different goals of companies:

For eg, lets consider a revenue increase goal. Factors that influence this goal are
1) new geographies

2) improving quality

3) lead time

Essence of HR in achieving these goals

A. Setting goals for the sales person:

What to measure, how to measure:

I) number of new customers per quarter

II) outstanding receivables target

When to measure

2 months or 3 months or as decided by the management.

Measurement. Monitoring. Feedback

  • When an employee knows that they are being measured and monitored, they become conscious. When they become conscious, they take their given target seriously.
  • Performance management system helps you in differentiating between your great, average, and poor performers.
  • In many organizations, promotion is on the basis of time and not performance. Wrong approach.
  • Staff cost should not be more than 4-6% of revenue.
  • You have to set up a system of compensation and reward. This needs to be a transparent process and it needs to be communicated clearly to all the employees. This will also help you attract new talent to your company.

How do you attract and retain talent in your company??
1. Clear policy framework
2. Clear performance framework

3. Transperent reward framework

There is reluctance in sme’s to recruit high salary employees.

Recruiting companies or online platforms??

  • It makes sense to use online platform if you plan to hire more than 10-15 employees in a given year.
  • Recruiting companies become your company representatives wherein they personally introduce your company to the prospect.
  • Employees also do a background check on the company they are joining. How do you treat your employees during their last 10-15 days in the firm? How do you handle the finalizaiton of accounts when the employee leaves?
    This talks a lot about your company reputation, which can spread either positively or negatively, depending on your treatment of departing employee. This has the biggest impact on the background check being done by the new employee joining.
  • HR is not a function or a department. It is a methodology. The ownership and onus of hr lies in the hands of operational leadership.
  • Framework needs to be set even for the owners if all top management seats taken up by the owners.

Talent management:

  • You need to specify the critical employees at each level of hierarchy. Critical employees should not be more than 15% of your total head count.
  • New employee is relatively more expensive than old employee. This creates dispute and feelings of resentment in old employees. They may sabotage. Solution is to maintain transperency with your old employees. Mentoring is required for the new employees for the first 90 days.


Contact Details:

1. Mr. Rajiv Misra – R Square Consulting
+91 97644 62022

2. Mr. Sharad Tandon – Standon Consulting
+91 93222 60941

3. The Yarn Bazaar
+91 93269 61542