While SMEs are modest in size, they play a big role in employment and job creation. However they can face difficulties in recruiting and retaining the best people. An SME is unlikely to have a well-known brand or be able to offer a career path or a high salary. Though it can offer other benefits:

• direct access to decision makers
• an opportunity to make real, visible contribution
• a company culture that ensures that employees are valued and listened to

Motivating staff

Employee motivation and engagement can make huge difference to productivity and profitability. One way to motivate staff is through increase in pay or promotion which may be difficult for SMEs.  However there are low cost benefit which could improve employee morale:

Cup of Tea / Coffee. It should be no surprise that free tea and coffee at work are an expectation. Even the taxman will allow the cost of a canteen as a business expense. While making staff pay for tea/ coffee will reduce cost it can be short sighted because it may impact staff morale.

Recognition of a job well done. The impact of a simple “thank you” is often overlooked, but can a positive result on motivation. Similarly an acknowledgement of hard work in team meetings can be effective.

Say it with flowers. A bouquet of flowers for a valuable contribution can make the recipient feel important. The business can claim it as an expense but provided it costs less than £50 it would a classed as a trivial expense and is not taxed on the employee.

Flexible working. For many employees the ability to stagger working hours can be important. Many businesses offer a start time of between 8am – 10am and a finish time of 4pm – 6pm.

Value the individual. A day off on their birthday, or paying for team meal on the day can boost morale.

Training. Support  staff in updating their skills and gaining new ones. It helps productivity and can boost staff morale. For an SME training is often seen as a cost but it needn’t be the case. An employer can offer in house training. It’s also worthwhile looking through the Skills Funding Agency website. Job relevant training is an allowable expense for tax.

Mentoring. Encourage experienced staff to act as mentors. They will gain leadership and management skills. The mentee will benefit from an increase in confidence, development of skills and improvement in communication.

These are some of the ways an SME can improve staff morale.