Making and measuring “good” HR practice in an SME: the case of a Yorkshire bakery

Purpose – The purpose of this paper is to understand how “good” HR practice is characterised in SMEs and what the drivers are for adopting this good practice. The paper also explores methods for measuring the impact of HR practice which are helpful and realistic in the context of an SME. Design/methodology/approach – The research was carried out in one SME, a bakery based in South Yorkshire. It was an action research project which utilised semi-structured interviews, participant observation on the factory floor and analysis of company documentation in the diagnosis phase. In addition, reflections on action interventions have informed the findings, together with post-project, semi-structured interviews with key actors three years after the completion of the project. Findings – The drivers of good HR practice were found to be size, market position, external “coercive networks”, presenting issues, the ideology of the managing director and the energy of an HR champion. The findings demonstrate that the impact of “good” HR practice can be best evaluated in SMEs through one-shot, cost-based metrics or more strategic qualitative measures. Originality/value – The paper develops an original model to show the relationship between the drivers, the HR practices adopted and measurable outcomes. This makes an important contribution to the debate about HRM within SMEs and it has practical value for informing the development of good HR practice in SMEs.