Abstract:
Small and Medium Sized Enterprises (SMEs) currently dominate the business landscape as they contribute more than 50% of the GDP and are responsible for the livelihood of 80% of the Zimbabwe’s population. As such their people management practices are a cause for concern amongst both academics and entrepreneurs. This is against the background laid by some scholars who argue that the small size of the farms and the corresponding family-like environment lays fertile ground for harmonious people management practices (small is beautiful). Meanwhile, by nature SMEs operate with lean budgets on the verge of the formal economy and as such this may dent their approach to people management. This study therefore sought to review the validity of the “small is beautiful” adage by exploring the employment relation from the view of employees employed in the SMEs. This study employed the qualitative approach and targeted employees working in SME retail shops in Masvingo urban by conveniently sampling small retail shops derived from the Masvingo City registered businesses database. The main findings were that SMEs do not have a stand-alone HRM department therefore are characterised by informality of HRM operations, a paternalistic management style, less bureaucracy along with a close working relationship between the employer and employee. Further research should be done to further entrench the view that HR practices in SME firms are unique and most appropriate for the structural environment characterizing SME firms.
