Human Resources in Small Business

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ACCT2188 – SMALL BUSINESS AND THE ACCOUNTANT
SEMESTER 1 - 2011

Lecturer: Hanh Nguyen

Group members:
Nguyen Thi Thanh Tra – s3274925
Duong Thi Chuong Dung – s3275045
Tran Y Nhi – s3275061

Table of contents
Executive summary3
Introduction4
Literature review4
Methodology11
Findings12
Quoc Bao Restaurant12
Tan Thanh Plastic Company14
Comparison with the theory16
Conclusion19
References20

I. EXECUTIVE SUMMARY:
The project report will discuss the ability of the small business to manage the human resource effectively. The focus of this topic will be the training of employees and the appropriate compensation system for the human resource which are playing an important role in well-managed staff. The literature review has gathered different ideas from a variety of sources and authors on the topic and has revealed that the small business is less likely to effectively manage the human resource because of insufficient funds. Therefore, they could not have a proper training method and comprehensive compensation system even though a large number of business owners do realize their importance and benefits of applying two of the above mentioned methods. With a view to determine whether the small business can effectively manage its human resource, a couple of interviews are conducted. Two small business owners who are from Quoc Bao restaurant and Tan Thanh plastic company are asked to share some interesting experiences as well as troubles they may meet in the way of managing their employees. Through the interview process, some differences are emerging which are the willingness of small business to pay the salary or other forms such as commission or bonus as high as possible to retent the employees and encourage them to work hard. Next, the report will compare both of the interviewed small business owners’ methods of managing human resource which are from manufacturing and service perspectives. The report also shows the identification of some of the similarities and differences between the literature review and the interview. Further explanation and possibilities are also included at the end of the report. II. INTRODUCTION:

Small business is becoming an optimal choice for those who want to have their own business and challenge themselves in the economic competitive environments. Because of that, the small business has to have a well-managed human resource which could contributes to avoiding the high failure rate as shown in various researches. The report will aim to discuss the ability to manage human resources effectively in relation to training and compensation. There are three primary parts which are the literature review, the findings in Vietnamese small business as well as the comparison with the relevant theoretical concepts. III. LITERATURE REVIEW:

Introduction
Currently, small business is expanding dramatically in many developing countries. To sustain in such competitive environment, small businesses have to manage a variety of different areas including finance, marketing, production, personal and personnel. Although there is a small number of employees in small firms but managing its human resources effectively, an area of personnel, has played a critical role in the survival and development of the firm .This review will mainly discuss whether the small business can manage its human resource effectively and further, emphasise two of the approach to assist the staff’s management which are training and developing associated with compensation and incentives system. Training and development

Training and developing employee is a crucial feature of human resource management. According to Ferguson & Reio Jr (2009), it might have a positive impact on the firm outcomes. Moore, Petty, Palich & Longenecker (2010) all states that employee training and development are the two basic important components of a firm’s training and developing program. Employee...
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