The Case for Human Resources in a StartupI met with a HR professional thinking of branching out on her own last week and had a great discussion around startups and human resources. The question we were pondering was why startups, and in my experience many small businesses for that matter, not think about HR early in the process.

I’m not sure we have the answer.

In my six years of running this business I have come across two types of businesses. Those that do think about HR right away and want to build infrastructure as soon as they make their first hire and those who think about HR after they have received a letter from the DOL. There are far more of the latter than there are the first. The first are typically more successful – anecdotal on my part of course, but my experience nonetheless.

My stance is and always has been that founders should start considering people practices from the minute they make their first hire. This doesn’t mean they need to implement complex programs right away, but their are people implications that should be considered before that first hire hits their first pay day, and I’m not just talking about the legally required stuff.

The biggest case I can make for building an HR infrastructure early, lies in the way the business grows from a headcount perspective. Once a startup receives it’s first or second round of funding, it usually has hires it wants to make immediately. Depending on the size of the funding, a startup could double in size in a matter of months. Because this all moves very quickly, the recruiting process, onboarding process and culture establishment is usually muddled, convoluted and often non-existent. Mistakes can be made in the hiring process, new hires aren’t trained properly or at all and the environment that is established is not what the leader intended.

Thinking about people infrastructure early in the process does add one more thing to a founder’s plate. It does mean they have to be deliberate about how they hire and how they move through every other phase of the employee life cycle, even if they only have five employees. But fixing mistakes later is difficult and painful.

It is the epitome of the old adage which I’ve heard phrased a million different ways, but I like this one.

“Take the time to do it right the first time or be forced to spend the time doing it over later. The choice is yours.”

So my plea to startup founders or small business leaders who have never really thought about the people infrastructure and have just been winging it – think about it. If you are struggling to hire, struggling to train, struggling to get people on the same page, you need to put people strategies in place to fix all of this. The longer it goes without attention, the harder it is to create what you actually intended in the first place.

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One thought on “The Case for Human Resources in a Startup

  1. Indeed a great piece of information. Startups are much more complex and difficult than they look, most people go for startups leaving their jobs like they gonna rock it in months, but most of those quit as soon as they face their first failure.

    Startups needs much more things than a person can think, so your post is vital. Thanks for the read.

    ~ Donna

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