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HR in growing startups

The sweeping success of TV formats like „Shark Tank“ or “Dragon’s Den” around the globe reflects the rising interest of entrepreneurial ventures and startups. The increased presence of startup incubators, hubs and VC’s further illustrate the high importance of successful startup ecosystems for a country’s long-term competitiveness and as driver of innovation.

In general, startups are confronted with numerous challenges including the scarce financial resources, the successful transformation of the business idea into a profitable business model and often little previous business experience. However, according to recent studies, some of the greatest difficulties together with the financial restrictions are in particular challenges regarding HR. As startups grow, they get increasingly complex and recruiting, developing and retaining employees becomes a mammoth task.

Since founders often lack the experience in implementing the HR value chain, experts increasingly advise entrepreneurs to seek HR-related support at early growth stages of their startup endeavor. From our experience in supporting startups in recruitment, the following measures can help to navigate the path to success with regard to HR-development in growing startups:

Integrate HR in your strategy sessions

There is no “one-size-fits-all approach” as to when you should first hire an HR-responsible person or transform an operational, administrative HR into a strategic function. Yet, what seems more crucial is the awareness of your HR strategy and the alignment thereof to your corporate strategy. Do you pursue a differentiation strategy or rather cost leadership? Do you place more value on flexibility or sustainability with regard to your human resource policy? It is important for the performance of HR that the HR strategy, the HR structure and HR competences are aligned – the magic word and most decisive factor is consistency!

Actively manage your corporate culture

The corporate culture, which is strongly shaped by the startup founder’s spirit, plays a decisive role in attracting and identifying employees. This distinctive culture will be put to the first acid test during the scaling phase as numerous new employees join the company. The management is advised to actively manage the pillars of their corporate cultures in order to prevent a dilution of the company’s identity. This can be done through regular company-wide activities so that less sub-cultures emerge, integrating joining employees in informal exchanges and explicitly stating your key values and visions. Furthermore, as stated by successful entrepreneurs a high degree of self-reflection is of utmost importance as the company’s growth also requires a lot of “letting go” and trust to your management team.

Find a trusted HR partner for you or your HR professional

With increasing maturity, HR professionals in startups change from being highly involved in operational HR processes such as recruitment to a more strategic and supportive role for managers. It is therefore essential, that they can focus their limited resources on what is most beneficial to the company’s objectives. Finding a trusted HR partner, who specializes in your most crucial HR subjects, often recruiting/selection, payroll or general HR administration relieves your strained resources. As they ideally support you throughout your growth, they familiarize with your distinctive corporate culture and consequently pay in on your employee value proposition.

Article written by Laura De Paolis, CFR Global Executive Search Switzerland

Photo source: Freepik

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