Paul Iles and Maurice Yolles
Most research and theory-building in HRD is associated with large organisations. However, most firms in the United Kingdom employ fewer than fifty people. The ‘official’ view sees the sector as not facing any specific issues that differentiate it from large firms; HRD, of a formal ‘enterprise training’ kind, is seen as necessary to facilitate growth (e.g. Gray 1993). SMEs are therefore seen as scaled-down large firms, and SME HRD as scaled-down large firm HRD. However, UK government-supported enterprise training programmes have often not had the impact on performance anticipated (e.g. Storey 1994; Gray 1993, 1998; Stanworth and Gray 1991). There is little evidence that small business-owners are particularly attracted to such training, either for themselves or their staff, and many have argued that such training has often not been cost-effective, nor has it had the impacts desired. Some have argued that this is due to the lack of education, inward-looking orientation and lack of perspective of many owner-managers (Watkins 1983) or their individualism, stress on personal independence and desire for control (Stanworth and Gray 1991; Storey 1994). Such factors may all contribute to the rejection of outside advice and training provision. In addition, very small ‘micro-businesses’ in particular may lack time, as well as sufficient clarity over diagnosing training needs.
Others have argued that SMEs, especially sole traders and micro firms, are very different from larger organisations, being disadvantaged not only in relation to financial and labour markets, information, and compliance with regulation and reporting requirements, but also in terms of the cultural and personal motivations of owner-managers and their need for a wide range of skills in managing informal relationships. These are not often taught in formal training courses (e.g. Stanworth and Gray 1991). For other firms, perhaps in the ‘growth corridor’ of fast growth SMEs with between fifteen and twenty-four employees (Stanworth and Gray 1991; Stanworth et al. 1992), there may however be a need to introduce formal management approaches to HRD, often perhaps because such firms are linked into complex supply-production-distribution chains and networks with larger businesses, and are often open to much more influence from large firms, including influences over HRD practices. Formal HRD may have a positive impact here, as Wang et al. (1997) show. However, few studies have looked at how SMEs actually manage their own