With a tightening labor market, rapidly changing economy, and state mandates that often seem to work against small businesses, Connecticut's small to midsize companies must get active and "fight for ourselves if we are going to effectively compete in the state," said David Lewis, president and CEO of Norwalk-based HR consulting and outsourcing firm OperationsInc.
"We're headed into election season and we're basically about to clean the slate when it comes to state government," Lewis told 300 business leaders at The Connecticut Economy Conference in Hartford September 7.
"So many of our elected officials are not businesspeople," said Lewis. "They don't have that perspective.
"They don't understand the direct impact. They think that what they're proposing is going to benefit the residents of the state but not necessarily thinking about what it's going to do to the businesses here."
Lewis urged attendees to "take a close look at the slate of people being presented in your areas when you get a chance to vote and look for people who have an understanding of the problems, some sense of business, and the impact businesses feel from a lot of the legislation the state has either attempted to pass or in some cases has already passed."
The Power of Small
Lewis was one of three panelists who spoke to conference attendees about challenges small businesses face trying to compete in Connecticut, nationally, and globally—often against much larger companies with deeper pockets.
"Obviously big businesses have a lot of money," said panelist Cindi Bigelow, president and CEO of Fairfield-based Bigelow Tea.
"So if we launch a wellness tea or wellness line, and a competitor that's very large launches a wellness line, they can do what they need to do to get their line on the shelves and advertise it, so money will always be an issue."
But Bigelow believes smaller firms have an advantage that can overcome financial disparities, something she calls the power of concentration.
"What I mean by the power of concentration is that you can pull together your different teammates to be able to really focus on a problem, a project, a game plan, or a strategy," she said.
Being a small business allows us to be really flexible.
"If we're successful, it's because of that, because of our size, because of that ability to continue to drive solutions to a higher and higher level—not just take the first solution, but get to the next and the next level until it really crystallizes into something that makes you go, 'wow, that's a lot better than other companies are thinking about right now.'"
Another edge small businesses have over their larger counterparts, said panelist Kelli-Marie Vallieres, president and CEO of Sound Manufacturing in Old Saybrook, is the ability to be more flexible and act more quickly.
"Being a small business allows us to be really flexible," said Vallieres, "and so we can see an opportunity in the market and quickly make a decision that we're going to go down that road and make a specific investment.
“We also have the ability to address our customers' needs at maybe a higher level than a larger organization does. We can have a conversation with somebody and say, 'yeah, we can do that,' and that's all we need to do, with a lot less red tape."
The small business panel discussion was moderated by Bonnie Del Conte, president and CEO of CONNSTEP, which became a CBIA affiliate earlier this year.
From Fishing Boat to Advanced Manufacturing
These days, competing isn't just about getting a business advantage or launching a better product.
In an ever-tightening job market, small businesses are finding innovative ways to compete for talent—often against larger firms that can offer higher wages.
One important strategy is to seek out nontraditional job candidates, those with the right basic competencies and personality traits who can then be trained for specific roles.
"The competitive job market means that fewer people are going to show up when you do the post-and-pray thing," said Lewis.
"Many of the top people in my organization started at the front desk."
Lewis advocates hiring for organizational fit and fundamental skills rather than specific experience or credentials, using tools like personality profiles to make the best hiring decisions.
"We educate our managers on how to select people for these factors," he said. "And look at people you already have and then you can see who you may want to hire who will have the core competencies and core attributes to be able to succeed."
The competitive job market means that fewer people are going to show up when you do the post-and-pray thing.
The nontraditional approach has also worked for Vallieres, who focuses on developing advanced manufacturing training programs with educational institutions and getting people interested in manufacturing careers.
She also emphasizes the "it" factor when it comes to hiring.
"Do they have the character we're looking for, and do they have the critical thinking, communication, and problem-solving skills," she said.
"Those are the things that go into the 'it' factor," says Vallieres.
"If we can find people like that, we can train them to do the work in our company."
Vallieres noted that one of her current superstars was a history major with a year of law school under his belt, and another was the captain of a fishing boat.
"Some of our best new hires have been those nontraditional hires, because they can look at things very differently," she said.
'You Don’t Have to Outspend Them'
Retaining the best employees is just as important as recruiting them, and that's where company culture and work-life balance policies play a huge role, said the panelists, especially when you can't always compete with large companies on salary.
"I think you should address the reasons you could lose people right from the get-go when you hire them," said Bigelow.
Inclusion and being listened to are the keys to creating an optimum culture in small businesses, she said.
"In a smaller company, you don't have the silo effect, so people can be exposed to all parts of the operation.
"The more you can share your vision and thought process about being a good leader and establishing a good environment, the less chance there will be of losing people down the road.
"People want a business they can be proud of. I tell people I make a tea bag every day, but then, I say, from that tea bag, look at all the good we can do."
Vallieres admits that her company really can't compete with Connecticut's manufacturing giants when it comes to salary, but the culture she creates at her workplace can bridge that gap.
"I was teaching a class at Three Rivers [Community College] on workforce skills, and I would ask the students what they're expecting out of a job," she said.
You should address the reasons you could lose people right from the get-go when you hire them.
"Then we rank them, and money always falls down to the eighth or ninth spot. Most people who are happy at their job don't leave just for more money."
Culture is also key for Lewis when it comes to keeping top talent.
"I wear jeans every day to work, and my employees do too," he says.
"We have a cabinet full of cereal, and we feed everybody lunch. We let people bring their kids in when schools are closed.
"We give them lots of flexibility as to when they have to work. At the end of the day, all your employees will migrate to the things that are important to them."
Lewis also addressed the challenges of managing a younger generation of employees, saying "millennials are a pain in the butt when it comes to managing them as a group."
"They are looking at progression in terms of months, not years—you're going to lose them unless you maintain an extraordinary level of communication with them," he said.
"They continue to get job alerts even after they have a job. They know what the guys next door are offering, so you have to be at the top of your game, but you don't have to outspend them to be successful."