Don't Let Companies Steal Your Million Dollar Idea When Applying to New Roles: How New HR Strategies are Becoming Unethical

Believe It or Not

After losing my English-speaking job due to the COVID-19 pandemic, I have spent the last year and a half searching for a senior role in Germany. Not an easy task as many know. However, I found that many companies lacked a clear and ethical approach to their hiring processes. Despite that sometimes the hiring manager and HR do not know what to do, how to do it, or when to do it, they already knew who will do it. This blog article will dive into the unethical hiring practices that some startups are using to accelerate their management and departmental learning curves, particularly in the Series A, B, and C stages. These practices often exploit job candidates and erode trust in the hiring process. We will explore why this is happening, why it is unethical, and what best practices startups should follow to ensure that their hiring processes are fair, respectful, and effective. You can also find below some case studies that companies have asked me to present (2021-2022).

As companies grow, their human resources (HR) strategy must adapt to the changing needs of the organization. In particular, startups at the Series A, B, and C stages often face unique challenges as they seek to expand and scale their operations. To succeed, these companies must attract and retain top talent, which requires a strategic approach to HR.

Unfortunately, some startups are using new HR strategies that are becoming an unethical power tool for accelerating the future management and departmental learning curve. One such strategy involves posting a job advertisement for a new strategic role, requiring candidates to analyze and present a real current situation case study that the company is going through, and having the future internal manager that will be promoted into that new strategic role present in the interviews. While this strategy may seem like an effective way to identify top talent, it is often exploitative and unethical.

What is Going On?

The startup world is highly competitive, and companies are constantly looking for ways to gain an edge over their rivals. One way to do this is by attracting top talent who can help the company grow and succeed. However, as companies grow and change, their HR strategy must also evolve to meet the changing needs of the organization.

At the Series A, B, and C stages, startups face unique challenges as they seek to expand their operations and scale their business. These challenges include attracting and retaining top talent, managing resources effectively, and navigating complex regulatory environments. To overcome these challenges, startups must have a strategic approach to HR that allows them to identify and develop top talent, create a positive company culture, and build a strong employer brand.

Reasons Why This Might Be Happening

One reason why some startups are using new HR strategies that are becoming an unethical power tool is the pressure to succeed and grow quickly. In the highly competitive startup world, companies often feel that they must move quickly and aggressively to succeed. This can lead to a focus on short-term gains rather than long-term sustainability.

Another reason is the belief that this approach will help identify top talent more effectively. By requiring candidates to analyze and present a real current situation case study, companies can assess their problem-solving skills, creativity, and ability to work well in a team. Additionally, having the future internal manager that will be promoted into that new strategic role present in the interviews allows the company to assess their ability to manage and lead a team.

However, this approach is often exploitative and unethical. Candidates are often required to spend a significant amount of time preparing for the case study, and they may not be compensated for their time and effort. Additionally, the presence of the future internal manager in the interviews can create a conflict of interest and bias in the hiring process.

Why It is Unethical?

The new HR strategy used by some startups is unethical for several reasons. First, it exploits job candidates by requiring them to invest time and effort in preparing for the case study without compensating them for their time. This is a violation of basic ethical principles of fairness and respect.

Second, it creates a conflict of interest and bias in the hiring process. By having the future internal manager that will be promoted into that new strategic role present in the interviews, the company may be more likely to select a candidate who shares their perspective and vision for the organization. This can lead to a lack of diversity in hiring and a homogenous organizational culture.

Third, this approach can damage the company's reputation and employer brand. Candidates who feel exploited or unfairly treated may share their negative experiences on social media or with their professional networks. This can deter other top talent from applying to the company and damage the company's reputation in the industry.

From One Professional to Antother

As a job seeker, I have experienced first-hand the negative consequences of this new HR strategy. I applied for a role at a startup that required me to analyze and present a real current situation case study during the interview process. I spent a significant amount of time researching and preparing for the case study, only to find out at the end of the process that one of the people who had interviewed me was promoted to the role I had applied for.

Not only did I feel that my time and effort were wasted, but I also felt exploited and undervalued. This experience left me with a negative impression of the company and its hiring practices, and I shared my experience with my professional network. As a result, I know of several other job seekers who decided not to apply to that company based on my negative experience.

Best Practices for Conducting Hiring Processes

While it is important for startups to have a strategic approach to HR, they must also prioritize ethical hiring practices. The following are some best practices that companies can follow to ensure that their hiring processes are fair, respectful, and effective:

-??????Be transparent about the hiring process: Job candidates should know what to expect during the hiring process, including the types of assessments or case studies that they will be required to complete. Companies should provide clear information about the hiring process, including timelines, expectations, and compensation.

-??????Respect candidates' time and effort: Candidates should be compensated for their time and effort, especially if they are required to complete assessments or case studies. This can be in the form of a stipend or honorarium, or by offering feedback on their performance.

-??????Avoid conflicts of interest and bias: Hiring processes should be designed to avoid conflicts of interest and bias. This can include having a diverse panel of interviewers, using objective criteria to evaluate candidates, and avoiding the presence of future internal managers in the interviews.

-??????Prioritize diversity and inclusion: Startups should prioritize diversity and inclusion in their hiring processes. This can include setting diversity targets, using blind resumes, and providing training to interviewers on unconscious bias.

-??????Build a strong employer brand: Startups should focus on building a strong employer brand that emphasizes their values, culture, and commitment to ethical hiring practices. This can help attract top talent and differentiate the company from competitors.

While startups at the Series A, B, and C stages face unique challenges in scaling their operations and attracting top talent, they must prioritize ethical hiring practices. The new HR strategy used by some startups, which requires job candidates to analyze and present a real current situation case study during the interview process and has the future internal manager that will be promoted into that new strategic role present in the interviews, is often exploitative and unethical.

To succeed in the long term, startups must have a strategic approach to HR that prioritizes fairness, respect, and diversity. By following best practices in hiring, startups can attract top talent, build a strong employer brand, and differentiate themselves from competitors. In doing so, they can create a culture of innovation, collaboration, and sustainability that will drive their success in the years to come.

Happy to share some of the case studies that I have worked on**:

**My intention is NOT to point out fingers but to share my experience. Not all of these companies that are on my case study presentations are applying the unethical HR strategy. You make your conclusion.