In a shrinking globe, Human resource is a key differentiator of an enterprise today as material and money are available aplenty for a good business idea. An entrepreneur would need a fully geared team in maturing an innovative idea into a business. The biggest challenge an entrepreneur faces is getting the right people for the job that, not just, understand the technology or process but have a similar motivation and drive to make it happen.
Some of the key concepts in managing HR effectively in a startup are discussed in this article:
Mere knowledge of process or technology or relevant work experience cannot be the ground for getting a resource on board in a startup. Identifying with the values and working style of the organization together with ability to work in a boot strapped environment are critical. It is always the dream of the entrepreneur to get the best of talent on board in a startup. While this is a common wish, employees working with large organizations cannot acquaint themselves with the rigor of work in a startup and the dream of the person promoting the business. There is hardly any scope for arm chair managers in a startup and everyone needs to make his hands dirty while executing work, unless the founders have it financed from external sources. Hence careful identification of individual traits which should sink with the DNA of the organization is as critical as the relevant work profile of the person proposed to be recruited.
Typical recruitment methods:
In a startup, the tendency to recruit persons who are known through past association or acquaintance is quite common and is generally a good practice. It provides the option of hiring someone whom you do not have to discover. Though the practice of probation is not to be done away with, it remains a formality on paper and startups do not have the luxury of experimenting time on probation. Recruiting from similar backgrounds is a great boon as the person being hired would have experienced the startup environment already. At the same time, experienced professionals from industry who are driving a process or a practice are inevitable and here lies the biggest challenge to the entrepreneur in hiring the right person and in making the right promises. Many a times promoters are stuck with over promising to lure right talent with the hope that the business would evolve faster and such undelivered promises hurt the start up the most. Therefore getting the right person at the right cost with clear future promises are critical in satisfying senior employees while making sure the monetary needs are kept in mind while structuring their salaries.
A good mix of youth and experience is a must as a startup is a high energy environment and needs younger people who could be trained to deliver.
Nurturing and Fulfillment:
Nurturing an employee is as critical to start up HR as its business. The promoter or the entrepreneur dons the hat of a HR head irrespective of a formal HR position within the organization. The size of the employee base and the access to the business head is an inevitable necessity in a startup and most of the times promises are managed by the business head. A start up being a war room in most situations, the demand for the business to make sure the focus of every resource on board is on developing the business makes this responsibility of HR mission critical. Nurturing an employee includes not just the training and skilling for his / her role but also would involve aiding / guiding the resource to represent the company fully which is not the case in a large structured organization.
Managing employee expectations is more important than mere hiring an employee. Though most of the startups hire talent at their market compensation, the person hired would always have a feeling of sacrifice towards the start up or its promoter and even small instances of non-fulfillment can be detrimental and lead to negative energies within the company. Social pressures on senior employees who work for startups are quite high and have the potential to disturb the environment and productivity when badly managed.
A very clear definition of roles and the associated compensation which should be well structured whether on going or deferred would help company in managing HR.
Typical HR practices akin to a large industry towards HR are a low key affair in a startup scene but the expectation management and assessment of performance are key to its survival and growth which when left incomplete could lead to business issues.
Article is written by S. Subramanyam, CEO, Ascent Consulting Services
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