If you can’t afford to hire a dedicated, trained human resources director or hire a full-fledged HR company to handle your personnel needs, you can still be successful designing your own HR system. Listing the various areas you’ll need to address in working with employees and using common HR best practices, you can create your own system that meets your company’s specific needs.

List the various human resources needs you have. Include recruiting, hiring, training, managing and terminating employees. Add payroll, compensation and benefits, workplace safety, company policies and procedures, and legal compliance. Consider optional functions such as wellness and morale building.

Decide on the organizational structure you will use. Create a flat structure if you are a small company with few employees who will share most of the work. Create a hierarchical structure if you have enough employees to create departments and have a totem pole. Develop an organizational chart that projects your staffing needs two years out, if you know your growth plans. Write job descriptions to ensure your organization chart assigns all duties you will need to perform to run your business.

Create a system for recruiting, training, managing and terminating employees. Write a procedure for placing ads, evaluating applications, interviewing candidates, setting compensation levels and making offers. Set procedures for orienting and training new employees. Create a company policy manual with your policies and procedures for attendance, requesting personal time off, submitting expenses, dress code, safety procedures, handling grievances and office behavior. Create employee and supervisor review processes, including annual reviews based on written job description performance. Create a procedure for terminating employees legally.

Develop a compensation program that includes levels for hourly wages and salaried positions. Meet with your insurance provider or a benefit provider to determine what benefits you can offer within your budget. Review voluntary benefits that let you offer employees attractive insurance and retirement program options at little or no cost to you as part of a strategy to increase your ability to recruit and retain employees.

Meet with your accountant to determine if you will handle payroll in-house or outsource it. Create your payroll system, including gathering information from new employees to add them to your system, managing deductions and paying employees, or interview payroll vendors to hire one to handle your payroll.

Review the costs and benefits of adding wellness programs, such as an employee fitness center, seminars delivered by health experts, a wellness newsletter or paying for smoking-cessation programs. Look at adding employee awards, contests or monthly birthday parties to develop camaraderie and employee loyalty.

Meet with an employment attorney to review your HR system and its components to ensure you meet your legal obligations as they relate to employees. Choose an expert who is familiar with your state’s regulations and federal laws.

Create a budget for your HR system based on your wish list. Review the parts of your system you can start immediately, those you will add as your profits increase or you add new employees, and the tasks you will outsource at first and eventually bring in house.