Improving HRM practice in SMEs: how to apply relationship marketing concepts

Purpose of the paper: This paper seeks to demonstrate an increased understanding of the importance of the creation of sustainable performances through the development of enhanced employee relationships that impact on small business outcomes in Australia . Methodology: A literature review and pilot study led to the development of a comprehensive survey instrument. The data from the survey was analysed and ten constructs identified, all relating to the relationships of recruitment, selection and retention. The final phase of the study focused on the confirmation of four significant constructs which were firstly pilot tested and then validated by semi-structured interviews. Findings: A series of relationships similar to that found in “relationship marketing” were identified as contributing to enhanced sustainable small business outcomes. This in turn has laid the framework for entrepreneurial activities to be improved through ongoing relationship development. Implications for theory: The paper demonstrates that the theory of relationship marketing may be utilised in disciplines other than marketing, notable in this case, in human resource management. Implications for practice: The study demonstrated an approach in which the use of the characteristics of relationship marketing when applied to the recruitment, selection and retention of employees in small entrepreneurial businesses can enhance sustainable performance. Value of the paper: The study will be of interest to academics and the owner managers of small to medium enterprises.