
The Top 10 HR Challenges for Startups and How to Overcome Them
By Brett Farmiloe
"What is one HR challenge that your startup faced and how did you overcome it?" We posed this question to startup founders and successful business leaders to learn about best practices. From the importance of documenting processes and procedures to managing a remote workforce with the help of HR technology, their advice can be applied to any business.
Solutions to HR challenges
1. Develop a comprehensive set of policies and procedures
"One HR challenge that our startup faced was that in the beginning, we didn't have any robust policy documentation. We had an employee handbook and a few other documents, but they weren't comprehensive. As we grew, it became more and more important to have clear policies in place for things like employee benefits, recruitment, performance management, disciplinary action, etc.
"We overcame this challenge by creating a new HR team to handle all of our HR issues. The team helped us develop a comprehensive set of policies and procedures. This has allowed us to set clear expectations for our employees and also keep track of everything that's going on so we can ensure compliance with all applicable laws."
—Shaun Connell, Connell Media
2. Start documenting from the get-go
"It goes without saying that starting a business is both a whirlwind and a roller coaster, which can make documentation a real challenge, setting up HR departments—and entire businesses—for failure. While it may not seem like a big deal at the beginning of a business's life, if you want a high-functioning HR department and a healthy organization when you scale, you have to start documenting from the get-go.
"Strong HR departments need proper documentation to legitimize almost any workplace event and activity. The only way to overcome this challenge is to simply commit organization-wide to regular documentation, and there are certainly document management software solutions that can help."
—Stephen Light, Nolah Mattress
3. Don't overwhelm new hires during the onboarding process
"An essential part of onboarding new employees is taking them through all your organizational policies and processes in order for them to be successful in their new job roles. That said, when there is too much of an information influx, it can actually be counterproductive, leaving your new hires feeling overwhelmed, confused, and stressed out.
"The best way hiring teams can overcome this challenge is by striking a balance between communicating what's absolutely essential and what can't wait for a later date as the new employees get acclimatized to the new workplace."
—Harry Morton, Lower Street
4. Create a method for constant feedback
"Identifying employee concerns is critical for corporate growth. Without feedback, there is no way to determine which procedures or areas need improvement in order to drive performance and raise retention rates. This can lead to disengagement and decreased productivity. However, figuring out how to perfect feedback collection and delivery can be difficult.
"To solve this, we used technology to our advantage by incorporating a 360-degree strategy into our feedback process. We tried and tested a range of performance management tools to find a perfect fit which allows our managers to measure employee performance and provide feedback, while also giving employees the option to relay their sentiments."
—David Bitton, DoorLoop
5. Set realistic expectations for employees
"The first months of running a business are the most difficult because you need to learn how to optimize productivity. It can be hard to determine what expectations can be set and to forecast for future operations and finances when you have no past data to rely on.
"We overcame this challenge by using SMART objectives to set specific expectations. We followed these objectives and recorded the outcomes, determining the best time management practices through manager-employee communication and trial and error."
—Roy Morejon, Enventys Partners
More articles from AllBusiness.com:
- Overcoming the Most Common Sales Challenges
- How Can I Create a Fair Return Policy?
- When Is It Necessary to Call a Meeting?
- Overcoming Small Business Challenges
- How to Establish a Credit Policy
6. Align your brand's DNA with the people you hire
"Many startup leaders are focused solely on ensuring the company is functioning on a daily basis, and they often forget to align the brand's DNA with the profiles of the people they hire. The challenge for HR is to make sure the right people are being hired from the start, so the business can start building a company culture that matches the company ethos. This includes ensuring employees get the right training and consistent brand messaging from the beginning."
—Mark Daoust, Quiet Light
7. Hire the right people from the beginning
"The one HR challenge that I faced during my startup journey was hiring the right people. I recruited people from remote locations and then hired them on a temporary basis. This gave me immense flexibility to hire the right person at the right time. I also had a quick interview process, where I would talk to the candidate for five to 10 minutes over coffee, and then only if I felt that the candidate was a good fit, would I hire them. This gave me an edge over other companies in terms of speed and efficiency in hiring the right person."
—Farhan Advani, BHPH
8. Standardize and automate with HR tech for remote workforces
"We are a Ukraine-based company, and we have a global workforce of over 600 individuals. We have employees and contractors all over the world, and while this allows our startup to provide 24/7 service, it can be a logistical nightmare for our HR department. So, the only way to overcome it has been to standardize everything and automate as much as possible. This has been possible through the extensive use of HR software and technologies.
"By providing our HR teams with the technology they need to manage such a large remote workforce, issues like time zones, tax forms from multiple countries, and varying labor laws have become manageable. As a cybersecurity company, we are also confident with the data security and privacy options available, and have moved everything into the cloud and encrypted HR software."
—Volodymyr Shchegel, Clario
9. Decide early on which benefits to provide employees
"Startups must decide which benefits to provide their employees, like healthcare, dental, vision, or even shares in the company. This can be challenging for a new company, and your HR team needs to ensure that you meet federal and state regulations, and that the company provides all benefits required by law.
"We understood from the beginning that employee benefits would help us attract the best people to our company and keep them. Healthcare helps your employees live healthier lives, and by taking care of your employees, you will be able to retain the best people in your industry."
—Georgi Todorov, ThriveMyWay
10. Find Ways To Balance Salary Realities vs Talent Attraction
"Finding people with the level of qualifications and experience that you need can be a big challenge as a startup—the right people aren't often willing to risk jumping ship from a reliable job to a new company. Added to that, a startup isn't always able to offer the salary and benefits to attract them.
"There are two main ways to overcome this challenge: 1. Be prepared to employ people with slightly less experience; if they have most of what you need, then you can teach them to become the perfect person for the role. 2. Get creative with your benefits packages; be upfront about not being able to match competitor offers, but detail what you can offer, and how it may progress as the company grows."
—Saadia Hussain, Pearl Scan
RELATED: Employee Rights and Labor Laws Every Employer Needs to Know
About the Author
Post by: Brett Farmiloe
Brett Farmiloe is the founder and CEO of Terkel, a Q&A site that converts insights from small business owners into high-quality articles for brands.
Company: Terkel.io
Website: www.terkel.io