Startups Need HR Too

The ever-increasing importance of human resources for startups


The big multi-national giants that we look up to, whether they are the rulers of the tech, fashion or food industries for that matter, all were once a startup or an entrepreneurial venture. It’s not that miracles happen overnight but, in fact, success comes to those who work hard. Having a strong, holistic strategy in place from day one can help your organization grow in a way that it will set a precedent for years to come.

A common misconception is that only large organizations need a proper HR department to manage work flow and the personnel associated with it. Small businesses need it too, and sometimes even more urgently than large, established organizations. The talent-hungry market scenario presents innumerable challenges for the management of an organization in regard to talent acquisition, recruiting, management, and retaining.

The crucial role of HR in startups

Usually, after graduation, most of the able students, who have put their heart and soul into making themselves academically strong so that they can secure their future, opt to start a business of their own and often struggle with managing human resources in a way that covers up for the risk that they have taken. Not everybody can digest being a corporate drone and hence prefer being their own boss. Human resources is one of the biggest challenges that startups face in establishing themselves on strong grounds.

Managing people is one of the most essential and ‘in-demand’ soft skill these days and HR is all about that. When you want to progress by leaps and bounds you need to have the basic ingredient of being able to work with and for people and manage them holistically, such that their individual goals are aligned with the organizational goals. When employees feel that they are being heard no matter how small the company is, the feeling of being empowered is all that matters. Negotiating compensation and benefits and retaining the most trusted and valued employees is central to a strong human resource department.

Small startups are already in need of support and guidance and cannot afford to not capitalize on any opportunity that comes their way regarding possible growth in the sales and ROI of their company. Hence a proper department that will take care of all the existing problems needs to be in place that makes sure that a competitive environment is maintained and that the already existing workforce is all praise for the organization. Word of mouth is very influential and effective in employee engagement and retention.

The change that needs to be brought

Usually, start-ups begin with single products and hence feel that they do not need a human resource department and can function without a so-called complex organizational structure that defines hierarchies and certain decorum to be followed. Often the roles that employees are assigned are interchangeable and there are no fixed job descriptions (often identified as a huge flaw). This is because startup ventures focus more on product development rather than the employee base. They continuously strive to bring unique product innovations that will help them increase their market share, build up on it and sustain it in times of economic turmoil. Market presence is what matters the most at this point in time.

Entrepreneurs are usually risk takers and they follow a very basic business model to survive the cut-throat competition. HR processes need to be handled with utmost efficiency and speed because the product or service needs to be delivered on time. The HR management strategy for start-up businesses needs to handle both the product development and employee performance at par so that they continue to deliver high performance and not suffer at the cost of mismanaged human resource.

Satisfied employees create satisfied customers

Business owners need to understand the inevitable link between employees and the clients that they serve. A satisfied employee will deliver a consistent message across all platforms about superior quality which will leave a positive impact on the customers. High morale leads to increased productivity and when a company derives high profits from an employee and acknowledges their effort in the process, the employee automatically feels motivated and owes his commitment and loyalty to the company. This, in turn, reduces the employee turnover rate.

Employee satisfaction is not only dependent on extrinsic factors but can also vary as per the condition of the company.

Compensation packages that do justice to all

In order to avoid conflict among your trusted employees, make sure that they are all treated equally and receive their fair share of perks and benefits. One hard and fast rule that all successful companies follow is making sure that their employees are compensated as per their contribution to the organizations. When designing compensation plans make sure that you have kept industry standards in mind and then act accordingly. Compensation policies should be continuously revised and evaluated to maintain consistency.

Train and develop to achieve perfection

Employees will only owe their loyalty to you when they will see future prospects of growth in your company. Every career-oriented person seeks to keep learning. Your employees are your prized possessions and you need to train them and promote them in a timely manner to help them attain self-satisfaction. This will not only set the employee on the road to success but also instill a sense of commitment and loyalty towards the company.

These training programs could be in the form of orientation or mentorship programs, in which you can involve the senior-level employees to impart valuable information that they have gained with experience working in that specific culture. Keeping your employees informed about the vision and mission is important.

Failure small

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