By Maren Hogan:
After writing in the HR space for 15 years and running a company for 8, I feel like I have a unique viewpoint on where HR and Culture intersect. In my company, barely 20 people, HR needs to function from a policy structure place. When a company first implements HR, it’s usually a reactive measure. Either they’re hiring like crazy or some compliance issue or lawsuit has popped up. But recently, some folks have created a conversation around a case for HR in startups in the interest of culture.Is it HR's responsibility to build the company culture of a #startup? @marenhogan has thoughts: Click To Tweet
I have thoughts.
While culture is certainly important for a startup, this function does not come solely from the HR department. When a startup first begins its journey, HR is little more than the place where hiring and benefits happen and traditionally gets formed around the 30-50 employee mark. However, culture starts day 1 and it starts with the founding team and early executives.
The way an organization does things matters, but again, this is not a function of a startup’s HR department. However, if your HR department is solely focused on talent acquisition, it’s 100% right that you can start to train your HR department, team or person to integrate culture into the hiring process. Cultural fit, value integration, candidate experience, benefits information, career pathing and performance expectations can also be conveyed in the hiring process.
Additionally, HR should be equipped to impact the culture, but leaving the culture up to one person or department to impact is not only inadvisable but could be dangerous. While you can’t ignore culture, you also cannot assign it to one person, or do much except direct and model it. If this is true at an established company, a high-growth startup is even more susceptible to groupthink. Instead of tasking your HR department with culture keeper duties, invite them to sit with the entire executive team (there’s that elusive seat at the table) and start building purposeful people and performance strategies.
It’s true that startups can grow so fast sometimes that focus can be lost and core values swept to the side in favor of product development or the next round of funding… Yet, the practical side of me recognizes that while HR is blamed for crappy culture, they are responsible for so much more, things employees would be able to answer with certitude (probably):
How much do they make every two weeks? What parts of their medical bills are covered? How much vacation do they have left? Can they wear shorts and flip flops on Fridays? Is their kid eligible for full dental coverage? Do they get a phone allowance?
These are the kinds of questions HR professionals face on an everyday basis and these are the questions that HR Technology and HR professionals within startups MUST address. Culture is sexy and admittedly necessary for startups, but there is an entire sector of HR called Core HR for a very good reason.
Blitzscaling and Healthy Growth
HR can be absolutely crucial when it comes to transmitting company values and managerial processes to new employees…if the basics are taken care of. While your employee may care very much about the values your company espouses, she’s more likely to care about them when they are aligned with her individual goals, brought up in her performance review and listed out in the company policy that outlines the work from home policy.
This is where HR weaves together the practical and the culture piece that so many startups dream about. Blitzscaling is a fun word but can be an absolute nightmare for an HR department ill-equipped to handle it. Basic functional systems, policies that can be enacted for the first firing, a performance management system and learning and development processes must be in place before scaling at that level. If they are not, a company can risk a simple compliance error taking it down.
Basic functional systems, policies and processes must be in place:
- Recruiting and Hiring
- Core HR
- Performance Management
- Rewards and Recognition
- Learning and Development
- Succession Planning
- Career Pathing
…before a startup goes on a hiring rampage, in order to scale quickly. BUT, all of those areas are hugely important in forming and cementing a company’s culture, as in this Airbnb example. Five of those areas are specifically geared toward the employee, which startups often mistakenly treat as commodities in those first, heady days.
Career Trajectory and Reality Checks
When it comes to paying attention to an employee’s career aspirations, it can be difficult to do this individually when growing at a breakneck pace. However, HR can assist by having the proper performance management and career pathing systems in place. One place that HR can assist, along with any corporate communication or internal marketing function, is to help instill the corporate goals, performance objectives and future vision to the employees and then train managers to do the same.
As important as recruiting and retention are, setting performance objectives across the organization (even when that organization is small) are just as important, because the thing they don’t always tell you in business books, is that you’re going to have to fire someone, maybe a lot of someones, which means you need HR to put in place the proper systems and channels for doing so to avoid dangerous lawsuits or employee disengagement which can impact productivity.Does your #startup have a performance management and career pathing system in place? Here's why even small companies need big strategy: Click To Tweet
The Option to Outsource
Perhaps the solution for some startups is to outsource all Core HR, like payroll, and allow your HR team to focus on implementing the things that truly matter to humans while managing all that other stuff from a distance. However, this means potential investments in systems that don’t always pay off when you have 20-30 employees but will make more sense when you have 40-50.
It’s often when startups are trying to get over one of the many famed “transitional humps” in their business that they realize a painful need. Culture absolutely needs to come first, but it must be infused in other, employee-centric systems that take care of all the needs of the corporate entity, not just those that impact the employer. And that has to be led by the executives from the top down. If your culture is terrible, you’re not going to hire a real HR person and invest in systems that may initially act as a cost center. You’re going to put a figurehead in place that acts as your advocate and does what you tell them, which is what Uber did.
And here’s where we agree. While I don’t believe HR is solely responsible for culture and cannot create a good one where a bad one exists, I do think that an initial hire of an HR professional who shares the executive team’s mission/vision/values and can imbue that into the talent management categories I listed earlier to create a holistic cultural experience is a must for startups readying themselves for rapid growth. It may slow growth (either from a financial standpoint or a velocity standpoint) but a startup that’s built to last is built on a firm foundation and in the age of information, when talent is truly a company’s differentiator, it’s the only way forward.