Recruitment Practices in Small and Medium Size Enterprises. An Empirical Study among Knowledge-intensive Professional Service Firms

The lesser degree of institutionalization and formalization of HR-practices in small and medium-size enterprises (SMEs) usually leads to them being attested a severe "(HR-) Management Deficit". However, the vast majority of these empirical investigations argues from a perspective dominated by the viewpoint of large corporations. As a consequence, the highly differentiated HRM-systems of larger organizations are seen as the, desirable ideal" for small and medium-size enterprises as well. On the basis of an empirical investigation into the recruitment practices of more than 300 professional service firms the study at hand tries to break from this deficit model. Instead, it is assumed that smaller organizations due to their - size-dependent - different preconditions resort to certain functional equivalents in accomplishing their elementary HR-requirements. It becomes apparent that first and foremost the quality of employee relations has a high impact on various measures of recruitment success in smaller organizations. This applies especially to those businesses that do not have implemented a separate HR-department.