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(Lise Gagne/Lise Gagne/iStockphoto)
(Lise Gagne/Lise Gagne/iStockphoto)

EMPLOYEE RECRUITMENT

The benefits battle: how a small firm can win Add to ...

When Fusion Learning Inc. president Kevin Higgins set out to lure a senior sales representative away from one of his firm's larger competitors, he recognized that his small company couldn't match the salary or the bevy of benefits the rep was getting at his bigger employer.

So Mr. Higgins tailored his sell to the benefits that his Toronto-based sales consulting and training firm could offer: a high-performance culture with challenging work, training and feedback, employee recognition programs and incentives including bonuses and annual staff getaways for its 20 employees.

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The prospect of being part of that culture appealed to, and ultimately won over, the candidate, Mr. Higgins says.

"It comes down to creating a total value proposition that's better than what an employee can get elsewhere," he adds.

It's a perennial problem for many small and medium-sized businesses: How can they compete for talent when they can't afford to offer the generous perks that are de rigueur at larger organizations?

It's almost a given that employees working for large corporations will enjoy a host of benefits, including health and dental plans, pension plans, group RRSPs, disability and life insurance, not to mention daycare and fitness benefits.

Most smaller businesses cannot offer the same. Fusion, for example, does provide a health and dental plan and a fitness subsidy, but not any of these other benefits.

And it's not alone. For instance, 78.5 per cent of small business owners do not offer a retirement savings plan for themselves or their employees, for reasons ranging from being too expensive to being too complicated to administer, according to an April survey by the Canadian Federation of Independent Business (CFIB) of more than 7,800 respondents.

The good news is that smaller employers can compete with larger firms for skilled workers even if they can't offer traditional benefits, says Daphne Woolf, a co-founder and managing partner of The Collin Baer Group Ltd ., a human resources consultancy in Toronto.

The trick lies in determining what makes your company unique -- and pitching it hard, she says.

"Small companies need to ask themselves, 'What do we have to sell or promote that makes us a desirable place to work?'"

Many entrepreneurs struggle to unearth what aspects of their company will appeal to candidates, she says.

"Sometimes they can't see it. They're too close to the business. So, a good place to start is to ask your employees, 'Why did you come work for us?'"

As well, they can sit down with prospective employees and find out what will persuade them to jump from a larger corporate ship, she says.

It might be more vacation time or working from home one or two days a week . Once you find that soft spot, play it up, she recommends.

It's certainly no longer just about the money, she adds. "Money is absolutely not a motivator. These days, it's all about the opportunity. I've seen three instances recently where people took pay cuts to change jobs."

Ms. Woolf says that small companies have many inherent advantages over larger ones by virtue of their size.

"There's less bureaucracy, for example, and employees have a direct line to the CEO. That can be very attractive," she says.

Other key advantages that entrepreneurs might highlight to prospective hires: Employees in small firms typically have more responsibility and control than their counterparts in big companies.

"You get a broader perspective because you are likely to be a jack of all trades. You get more exposure and more learning opportunities," Ms. Woolf adds.

She says flexibility can be another plus to bring to the table. "Typically, there is less institutional structure, so they can customize roles and compensation packages to individuals."

As such, individuals tend to have more of an effect on a small company, she says, and not just on a specific segment of the organization.

When Endo Networks Inc. president and chief executive officer Peter Day is pursuing potential employees, he says he focuses on the intangibles that the Mississauga, Ont.-based field and event marketing agency, can deliver.

The firm doesn't offer benefits such as pensions, group RRPS or life insurance to its 51 employees, but it does pay regular bonuses, which are tied to individual and corporate performance.

And Mr. Day also stresses the fast-growth company's high-profile clients, along with a fast pace and plenty of opportunities for skills development and career advancement.

"The idea is to show them they can be part of that success. As we continue to win new clients, it imbues the organization with an excitement that helps with employee retention and also with attracting new employees," he says.

"Everybody wants to be part of a winning team," he adds.

The fact that Endo doesn't track hours is another selling point, Mr. Day says. "It's all about getting the job done. There's no time clock here, no requirement for you to be in the office at specific times."

Such freedom is particularly attractive to those who are used to punching a clock, he says.

At Fusion, Mr. Higgins has developed a staff on-boarding plan customized for each new employee. Used as a recruiting tool, the plan includes both a job description and a development program that shows a prospect a clear path.

Another perk that speaks to individuals is giving staff raises when they're earned - not just on an annual basis, nor based on how well the economy is doing - plus a quarterly bonus tied to performance, Mr. Higgins adds.

Then there's the annual incentive trip. Last year, Fusion took it's entire staff and spouses to Mexico for four days. Other getaways have included Ontario's Blue Mountain ski resort and New York.

It's all part of creating a collaborative environment where employees are supported, challenged and celebrated, Mr. Higgins says. "We're upfront about our expectations and what we'll do for you in return. We have extremely high expectations, but we also offer high support. We will equip you to succeed."

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