Most organizations and virtually all services based start-ups will, when pressed, say that their biggest assets are their people. So much so that this has become a cliché but like most cliché’s there is a kernel of truth there. It is also equally true that despite the best intentions the role of HR in a fast moving start-up often gets confined to recruitment, employee relations and day to day transactions. In previous posts we have spoken about the kind of people a start-up should recruit and also what could attract them to join a start-up – in this post let us focus on the strategic role that HR can play in the growth of a start-up.
Probably the single most important role that strategic HR can play is in defining the culture of the start-up based on the vision of the founders. Founders usually have a clear view of where they want the company to go – HR is best placed to capture this big picture and to translate it into the constituent elements that should go into forming the DNA of the start-up. HR should then, ideally, take responsibility for designing the people processes of the start-up that reflect this DNA in each and every operational sphere. Specific emphasis would be on the creation of the organizational structure, defining key roles and the responsibilities going with them, recruitment and retention policies and the performance management practices of the company. The objective should be to ingrain this DNA into everything the start-up does so that even while individual employees and teams are going about the day to day pressures of their jobs the broad directions are not lost sight of. This is critically important if the start-up has to stay on course through the many distractions that staying in business throws its way every day.
Another important strategic role that HR can play is in preparing the start-up for scalability. Ad-hoc issue based management works well in the early days of the start-up but as the team grows this has the potential to hold the whole organization back. This is where HR steps in by putting in place an organizational structure that is functional and resilient while still allowing for calibrations as more employees come on board and teams become larger. Another area demanding specific attention is training and development. Employees who function well in the early days of the start-up need to be equipped to be able to continue doing so as the organization evolves. This will allow organic as well as inorganic expansion as required without having to go through an organizational redesign each time.
Some of what we have mentioned above can be interpreted as supporting the need to maintain continuity as the start-up grows so it may be seen as ironic that the next strategic role we believe HR can play in a start-up is preparing it for change. If the start-up pans out new people will come on-board with characteristics and motivations different from those of the people who come on-board in the earlier days of the start-up and all of their needs have to be catered to as soon as they join. A growing team could also make the founders more distant or less approachable thus increasing the need for building a cadre of managers at the next level ready to step into the breach – not an overnight change by any means. All this points to the important role that Strategic HR has to play in laying these plans even before the changes occur to ensure the start-up is ready to absorb this change when it does occur.
HR is among the most critically important functions in an organization – in the context of a people dependent start-up our view is that the importance of the function is magnified. We believe the areas we have indicated are where Strategic HR can make the most difference – do you have another point of view ? In your experience is there another area we could add to the list?