Successful startups are based on disruptive ideas. They are dedicated to fast growth and this means they just don’t want to be bogged down by structure and regulations. However, the one truth of a startup is that they bet on people to get them moving fast. Yet when it comes to hiring, startups have their problems in recruiting and retaining the right talent. That is why HR role in startups is important and even a small HR team can make a big difference. They can create a HR plan for a startup company that will change as the company evolves. Here are a few HR challenges startups face that are very different from the traditional companies.
Challenge #1: Startups don’t have dedicated hiring resources
Startups in their initial years often do not have dedicated HR teams to handle recruitment and talent management. Small companies need a dedicated in-house recruiter with the right recruiting experience. A lot can be done even on a shoe-string budget.
Implementing the best HR practices for startups will help companies hire and retain their top performers. The hiring process starts with writing a great job posting that captures the company’s work culture. Good Employee Referral Programs can take the headache out of hiring. Attracting the right talent that can grow with the company and be a right-fit is all important.
Challenge #2: Startups ignore creating HR policies
“Every company has a culture, whether you design it or not; whether you articulate the values or not,” says Robert Siegel, venture capitalist and lecturer at Stanford Graduate School of Business. Within the company’s initial years, attrition rates can be as high as 60% and this is usually all to do with poor talent management and that comes down to company culture.
When focus is on speeding up deliverables and customer acquisition, then often creating a great work environment can take a back seat.
Many people are under the mistaken assumption that an HR department is only about hiring. However, HR is also responsible for establishing the company policies that will manage their people and nurture their talent. It is good to create a personalized HR policy for startups. This should be shared with new employees who are joining. It offers guidance as well as defines a culture that fits with a company’s values.
These policies should define what HR issues arise for startups and create solutions for them. These policies should cover dress code, if any. Most startups have a very casual dress code but it is still good to establish the standards as it can define the environment that you will have. Many employees call in sick at some time or the other. But when does it hover near the too much mark? This can really create negativity in the work space and needs to be handled. Another one is about office romances, even if not overtly stated, management should internally know how to handle this.
Challenge #3: Startups might not keep proper records
Often HR records of employees are saved in a haphazard way in the initial years of hiring. There is no reason for this since they are now many cloud-based systems for both candidate recruitment and talent management. It is good to keep this information in a file: copies of CVs, work history, performance evaluations, records of working days and leave taken etc. companies are required by law to keep records to comply with workplace health and safety laws as well. These become important from a legal standpoint.
Challenge #4: Failure to have training and development opportunities
Many startups are realizing the importance of this strategy. However, it can get skipped when there is no one tasked with ensuring it happens company-wide. This is where a strong HR makes its presence felt. After all employees are invested in their own career growth and it makes sense for the company to be as well. Else, employees can leave for greener pastures. Training need not be expensive but must be regular. It could be a mentoring program, after all subject matter experts within the company can have skills they can share. Startups also have a good network of external contacts that they can invite in to have informal discussions.
Challenge #5: Keeping employees happy, increases productivity
Providing opportunities to build camaraderie at work is vital. Employees at startups get caught up in the mad rush to meet deliverables and it is good to create stress busting opportunities. Your HR team must be tasked with creating this friendly environment. Keeping employees motivated and committed needs different methodologies. Most startups do well in this regards with team lunches, Friday movie nights at work and other interesting activities that keep the energy bubbling.