Young companies need a good HR strategy to secure efficiency and team retention
Startups are rapidly evolving, dynamic businesses that don’t want to be set back by excessive regulations and formalities. However, a young company cannot function smoothly without a set of implemented policies, strategic plans and processes that would cover the business’s short-term needs and mitigate any hazard in a long run. As a matter of fact, launching a startup is a risky enterprise (according to the Telegraph statistics, in the UK, “60% of new businesses go-under within three years, and 20% close their doors within just 12 months”). That is why operating a thriving new company requires a lot of consistent hard-work, accurate planning, and management ability to follow development strategies.
While there is a number of reasons why a new startup might go downhill, failing to have a distinct HR strategy in place is one of the main causes behind a company decay. In fact, according to Entrepreneur, “businesses fail 23% of the time because they don’t have the right people working on their team”. A sound HR practice supports a growing company without gearing it down: on the contrary, it keeps the business organized, detecting the right people to do the job and assisting with retaining the top performers.
The role of HR in a startup: managing the processes right from the start
Human resources management for startups is unlike the one of big corporations since the challenges they have to confront and the objectives they try to reach are quite different. A startup needs a well-defined structure, and without an HR function the founders risk letting inefficiency and toxic work habits find their place in the office, leading to lower employee morale and damaged employee retention. So how can human resources help, and what are the main tips you should keep in mind entering a startup environment?
- Firstly, HR managers should manage a targeted talent acquisition and develop a competency model. For a small company, it is crucial to hire the right employees for the right jobs from the very beginning. HR manager should carefully consider candidates’ cultural fit (workers must be in line with the company philosophy), work and salary expectations, as well as their ability to contribute to the startup growth. It is equally important to organise their onboarding in the best way possible, transmitting the startup goals, development strategy, and core values. It is exactly the human capital that makes the difference and guarantees a business success.
Beware of the risks of “family” startup atmosphere: sometimes small businesses tend to cultivate relationships that are based on personal preferences (when you like the colleague as a friend) and not on his/her ability to get the job done. So, place productivity and results perspective as the cornerstone of your recruitment decision-making.
- Even when a startup is still small, it is necessary to formalise employee contracts up front – this way you create a secure, organised working environment. If you have an innovative product or technology, consider integrating non-disclosure and non-compete clauses in the agreements to ensure the intellectual property rights.
Besides, as advised in Forbes, “don’t offer new hires the moon. Some startups try to draw in top candidates by offering great salaries, perks and unique benefits. However, in the long-term these practices could hurt you”.
- It is of extreme importance to nurture the talent you take on board. In his October advice column for the Daily Mirror, Jobrapido CEO Rob Brouwer suggests constantly developing the employees’ skills: “Some people are happy to do the same job for many years, but most want to learn and be challenged. Helping your staff acquire new skills will increase job satisfaction and staff retention”. Apart from more classical L&D projects, consider mentorship programmes, especially if your budget is tight: pairing juniors with senior employees is a great tool for sharing expertise.
- Another aspect that requires attention is the way you encourage employees and stimulate their work. It is best to choose the approach of empowerment instead of micro-management. According to Jobrapido CEO Rob Brouwer, a startup culture should not be based on “trying to micro-manage how managers and team leaders achieve targets. They will have different styles and personalities. One size doesn’t fit all”.
- An HR should never fail to oversee the process of documenting performance. In a dynamic and moving startup culture, documentation may be overlooked. It may eventually land you in a serious legal trouble, so never forget to keep your documentation flow clear and precise.
- As soon as your startup reaches the first-year anniversary, you should elaborate performance management tools to evaluate the staff’s job performance. These reviews are great for “encouraging responsibility: building a company culture in which feedback is shared consistently over time enables employees to feel appreciated, which will help to build employee commitment, trust and accountability”.
Are you an HR manager looking for the best targeted candidates for your company, no matter big or small? Source top talents for your business through our website: Jobrapido is a leading international job search engine with the best pool of jobseekers perfect for your goals.