Large multinational companies are perceived by job seekers as preferred employers that stand a better chance of acquiring the top staff, leaving SMEs with the rest. However, many job seekers are now beginning to recognise that SMEs have a lot to offer, such as less hierarchy in organisational structure, and more opportunities to take on different roles for wider exposure to different functions.

Professor Fitzsimmons said that a smaller employee base meant that SMEs needed to ensure that they had the right people with the right skill sets and capabilities to align with its growth and ensure that employees could reach their potential in the firm.

'While these companies grow more rapidly it is important to consider future skill requirements of the company to ensure that there are sufficient processes in place to manage the individual's personal development.'

One common mistake most SMEs make, according to Professor Fitzsimmons, is that they do not put internal talent management as one of their top strategic priorities. And, as the business grows, these thriving companies tend to acquire new top managers from outside, while leaving their loyal employees with great potential out of the management picture. As a result, these employees may feel marginalised and under-appreciated for their contribution to the company, and hence become unmotivated and leave the company.

'SMEs need to take a broader view of talent management to develop their staff and managers for a number of potential future positions.'

Smaller firms may generally feel that they do not have the time or resources to develop talent management programmes to meet the needs of their workforce. However, Prof Fitzsimmons said if companies wanted to compete they needed to recognise the importance of talent management and maintain a motivated workforce with the right skills.

While SMEs may be at a disadvantage in competing for staff with big companies, because of noticeable gaps in benefits and career prospects, small companies can focus on employees' personal growth in their talent management strategies.

'If the firm recognises this and provides sufficient resources for individuals to develop and achieve their potential, it can also help the firm respond to challenges and compete effectively with larger firms,' he said.

To attract and retain staff, small companies can also develop a public reputation in the industry for being a great place to work to attract top professionals.

'Talented candidates will be more interested in working for a company that values its employees and gives them opportunities for continued success,' said Professor Fitzsimmons, adding that companies needed to recognise that people were not always motivated by extrinsic reward strategies.

With that in mind, he also pointed out that management of SMEs needed to recognise the necessity of offering reasonably attractive compensation packages if they wanted to retain the right staff in the company. Opportunities include training and management education.

Professor Fitzsimmons said that management education and training were particularly important to prepare managers for the gaps that might arise in the company's development.

'If a middle manager is encouraged to undertake an MBA programme then they should be ready to step into any management role, given their broad based understanding gained from their MBA of management and the interaction between managers,' he said.

In the course of developing the talent management processes, small enterprises need to have a structured and transparent performance appraisal system in place that can help employees evaluate their competence gaps.

To overcome the time and resource constraints SMEs might face in developing and implementing talent management initiatives, Professor Fitzsimmons said that they should consider partnering with external universities and providers of management education to craft tailored programmes to help staff develop the right skills in a cost-effective way.

SMEs should allow more flexibility for their staff to choose their desired programmes or courses rather than give prescriptive training.