International Handbook of Entrepreneurship and HRM
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International Handbook of Entrepreneurship and HRM

Edited by Rowena Barrett and Susan Mayson

This invaluable reference tool has been designed in response to the growing recognition that too little is known about the intersection between entrepreneurship and human resource management. Paying particular attention to the ‘people’ side of venture emergence and development, it offers unique insights into the role that human resource management (HRM) plays in small and entrepreneurial firms.
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Chapter 16: Becoming an Employer

Hefin David and Gerald Watts


Hefin David and Gerald Watts Introduction For most small firm owners the employment of others is an essential condition for firm growth, as it can overcome constraints on human capital and enable scale increases. It is a significant step for the owner, marking a shift to a new role with new responsibilities and perhaps changes to their selfconcept. It can also signal change in the way the owner relates to the firm and thinks about its future. The employment decision is also important for other stakeholders in the small firm. Most notably it is important for the new employee, who will become a significant member of the growing business and play an important role in its development. Governments (local, regional and national) also see the transition from non-employer to employer as being important in terms of the impact on employment, economic growth and social capital. Literature examining the concept of human resource management (HRM) in small firms has grown significantly in recent years (see for example Barrett and Mayson, 2006; Marlow, 2006; Ram, 1994; 1999; Ram and Edwards, 2003; Taylor, 2006). Yet there is little research about the first employment decision, despite the criticality of this to the firm’s growth and the owner’s personal development. The purpose of this chapter, therefore, is to report on the initial findings of case studies of five small business owners, where their personal approach to the first employment decision is explored. In these cases, employment is conceptualized as a learning...

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