Problems related to Human Resources (HR)-

Problems related to Human Resources (HR)-

Although, MSMEs are the second largest employer of human resources after agriculture, providing employment to large number of people in the rural and urban areas of the country. But unfortunately they have to face huge problem of recruiting required number of manpower and managing them effectively. Manpower in numbers is not such a big problem. The biggest problem is the lack of right team and skilled manpower. Money can be borrowed from any bank/ agency/financial institution but skills cannot be borrowed from outside. Thus MSMEs are not in the position to grasp the opportunity of the implementations of some bigger scale project which requires much skilled workforce.

Efficiency of an organization depends on its management: Top/ Administrative level; Middle/ Executory level; Low/ Supervisory/ Operative level. Majority of MSMEs in India are basically organized as proprietary. According to Fourth Census out of total rural MSMEs in India about 92.40% are proprietary whereas only 2.82%, 1.89%, 0.43%, 0.38%, and 2.08% are Partnership firms, Private Company, Public Ltd. Company, Co-operatives and others respectively. These proprietary units continue to be owner driven with inadequate awareness and skills. There are total 14 functions of management to be done in an organization. Whether we make a pen or an aero plane, the activities are same, only the magnitude/ volume changes. But here a single man controls the whole organization- at the decision making level and at the operational level and therefore the decisions may be affected by the lack of managerial competence.

The business is a continuous process having so many operational activities. Delegation of authority can make the entrepreneur to focus on more important issues where his expertise lies. But in an eager to handle and control each and every operation of the organization, the entrepreneurs of SMEs are not able to give the time for their core business areas and lacking behind the competition. There is a lack of proper delegation of authority at the higher levels and adequate decentralization at the departmental level due to which the business activities become haphazard and complex.

Besides this, the owners of the SMEs often don't have long term vision about their business; they do not have a clear business plan/budget even for next 3 years. It is very important to analyze your cash flows and plan your business in advance. Entrepreneurs need to understand the market, the customer tastes and requirements and completion in the market and prepare a business plan for the organization and work towards one goal. It's very easy to buy and sell, but business is much more than just buying and selling, it is about building a solid foundation for sustainable long term business.

Many of the employees in MSMEs started from the ground up after working with the organization for many years some of them are often holding supervisory and managerial positions. These employees may not be use to of modern techniques and often have high resistance to the changes in the working process that they are comfortable with after many years. The top level management also faces difficulty in even convincing the banker for credit.

Developing human resources is a continuous process. But MSMEs fail to provide empowerment, equality; security (both economic and emotional); opportunity; and even career advancement opportunities to its employees, available in large organizations and therefore are not in a position to hire skilled and competent manpower. The middle level employees of MSMEs face the problems of proper skills and training; attitude and lack of motivation; and the right mindset. These units generally provides much of its training through apprenticeship schemes and on-the-job learning, but in an increasingly technical and communication-oriented world, specialized training schemes (e.g. computing, accounting, personality development sessions etc.) are needed, including special programs for women, who dominate many service and trading activities. The belief is that all this makes an individual a better person, which in turn leads to better productivity and a spirit of accountability and commitment in the employees.

Now a day’s the role of ‘Green Skills’ to reduce the greenhouse gas emissions is getting consensus. But many companies, particularly MSMEs, do not have good information about the most efficient carbon abatement measures. The staff of MSMEs often does not have the skills and internal resources to address emerging environmental challenges and thus continue to engage in more carbon and energy intensive activities.

Due to competitive pressure on MSMEs, they have to fight for new markets, new products and new distribution channels. These movements can be faced just from those units that have quality information and communication systems support. Therefore there is an urgent need for MSMEs to be ICT competent units. Poor communication infrastructure results in limited access and higher costs. Therefore employees face the problem of adequate information relating to their tasks to enable them to plan and perform their jobs well. Apart from this, MSMEs lack affordability to employ IT personnel. Due to high demand they are often attracted to bigger companies and MNCs. If anyhow MSMEs succeed in attracting them it is even more difficult to retain them because of high remuneration paid to them.

Products of MSMEs are poor because the workforce skills to produce better ones are often lacking, and their skills are not matching up to the product market strategies. The operative staff is still performing their activities with outmoded production techniques coupled with low traditional skills. Many Government programmes have been introduced in this context but without strong back up of skill formation package at the appropriate time and place, are not yielding the desired results. These programmes only stress on imparting suitable training to the employees, but their implementation thus far does not present a consistent picture of implementation in a well knit and coordinated fashion.

Due to these deficiencies MSMEs are unable to take mega projects by providing their best in technological advancements, right from product development to inventing new categories. Thus, more initiatives need to be taken at the Centre and the State level to ensure proper management of human resource in this sector. This would raise their production capacity, improve their marketing and distribution network, set links with people/ industries within different parts of India and/ or abroad, as well as motivate new and talented manpower to join MSMEs.