Common Startup HR MistakesStartups often face ups and downs, it’s just the nature of the beast, but many of the downs are caused by having a poorly planned human resource strategy. Moving forward we’ll discuss some the human resource mistakes made by startups and how your startup can avoid them.
Your Vision: Money
We’ve all seen it. A young startup that has only one goal in mind: money. While yes, money is a natural byproduct of a successful startup – the vision should be something else entirely. In a 2015 interview with Business Insider the CEO of SalesLoft, Kyle Porter, discussed how tearing down his startup and starting all over again came down to a misaligned vision.
Porter focused too much on sales and marketing when he started SalesLoft. After landing a big account and being asked by his team what they should do next, Porter is quoted as saying “Let’s double down on what we’re good at, let’s go talk about ourselves.” (http://read.bi/2gm9x69).
Fast-forward to the date of the Business Insider Story where Porter, now leading a 50 employee strong startup, lays down his new vision for SalesLoft.
“The new SalesLoft would do three things differently, Porter says.
- First, he would establish “core values” for the company, just to ensure that he was on the same page with any new hires. Those values would revolve around concepts like open communication and personal responsibility. This approach has led to a much more in-tune and happier workforce, Porter says, which results in better product.
- The second thing was something Porter says he had to learn the hard way: Never let sales and marketing outpace investment in the product.
- Third, even though Cummings is still invested in SalesLoft, Porter needed a co-founder who would be “in the trenches” with him every day. He ended up recruiting local startup vet Rob Forman as his COO and Tim Dorr in a technical role, giving them both founder status in the revamped company. “(http://read.bi/2gm9x69)
Your Company Culture Is Shuffleboard and Branded T-Shirts
While there’s nothing wrong with having a work hard play hard culture, there’s no substitute for a well-tuned and well thought out strategy for developing a workplace culture. Company culture should represent a set of values shared by the startup as a whole. A shuffleboard and matching t-shirts won’t be enough to tell both the outside world and the inner company what you’re all about. Culture should ultimately set the standard for what kind of environment the employees will work in and it should convey to the outside world what you’re all about.
If your startup emphasizes inter departmental communication a shuffleboard isn’t going to help much in that regard. It’s better to think of processes that creative incentives and opportunities for your values to come to life.
You Don’t Have a Dedicated HR Person
Many startups are cash strapped at the start. They aim to run a lean operation until they’re able to secure funding for the bells and whistles such as a shuffleboard, coffee maker,food, or a dedicated HR person.
Most startups don’t require a full-blown HR department to help them tackle complex employee management and compliance issues, but having outside assistance of some sort can help them place the right candidates within their organization and formulate a plan that will pay dividends going forward.
The cost of replacing a bad hire can easily amount to twice that person’s salary. So if you brought on a new hire earning $30,000, on average, you can expect to lose as much as $60,000.
In the case of the bootstrapped startups, you can expect a dip in morale and possibly irreversible damage if the bad hire is brought on to a key position.
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