Organisational and HR tips for Start-ups and Small Businesses

Research shows that 54 percent of?start-ups and small businesses do not have anyone to handle Organisational and HR matters?or have another staff member handle HR issues piecemeal to save money.

However, Businesses require some sort of professional Organisational and HR support. Most founders of start-ups or small businesses or those assigned to take on HR responsibilities are typically not prepared to do so. The planning for the Organisational HR function is more ad-hoc and casual.

Research suggests that 70 percent of businesses with five to 49 employees add HR onto the workload of employees with little to no experience in workforce issues. Around 23 percent of the time, these “ad hoc HR managers” fill roles including office administrator and finance Manager, Chief operating officer, etc., while 12 percent work in finance and handle payroll, expenses, and corporate travel.

So here are some suggestions for start-ups and small businesses to handle their organizational strategy and HR matters:

1.?????Organisational Strategy and Value systems:

a.?????Have a yearly dedicated Strategy Review meeting of your leadership team. Discuss your market opportunities, challenges, competitors, technology changes, talent bench strength, regulatory changes, anchoring your strengths deeper, etc. Formulate your action plans and share and cascade your vision and plans across the organization.

b.?????Have a quarterly meeting exclusively to review your progress on the above with the leadership team. Ensure that these do not mire with operational issues and day-to-day problems. Operational review meetings could be separate meetings conducted more frequently weekly, fortnightly, etc.

c.??????Clarify what values and ethical standards you propose to establish and these would be communicated and cascaded across the organization. Slowly build stories and folklore around these core values and ethical standards you uphold.

2.?????Keep Administration and HR functions distinct: Most start-ups and small business clubs the two functions and have one person responsible for the same. The skill sets required for these two functions are different. The administrative requirements such as building facilities, canteen facilities, transport & lodging facilities for employees, Office stationery arrangements, liaison with police and local bodies, etc., etc. are heavy-duty administrative requirements (usually thankless jobs!!). Handling HR is a full-time assignment and needs dedicated focus from the start. There are a few administration roles in HR, such as running an error-free payroll, complying with regulatory requirements, and filing the paperwork/ portal details accurately and error-free, etc.

3.?????HR systems and processes:

a.??????Compliance and establishing systems: There are workplace laws and standards every company with more than one employee must follow, some related to employee rights and others to employer responsibilities. Some laws vary by state. Organizations need to formulate rules for office timings, discipline expected from employees, etc., and a good place to start would be referring to the Industrial Employment (Standing orders) Act 1946, which would guide you on essential points to cover and provides for a model standing order. Act as such may or may not be applicable for start-ups and small businesses.

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b.??????Workforce planning: Your HR strategies should be in alignment with business goals, including forecasting, OKRs, and revenue model. Plan for an efficient and smart workforce for now and future. Be frugal and competitive while deciding on long-term permanent staff resources. Outsource processes wherever found feasible without losing your strategic advantage or providing you with a better cost-benefit. Engage part-time Consultants and specialists if there is a cost/scale advantage in the arrangement. Remote working talent on assignment based/project-specific requirements may provide a better cost-benefit advantage.

?c.??????HR processes basics: Start preparing basic organizational structure & Job descriptions. Start with a flat organization with a max of 2-3 grades example: blue-collar, executive Managerial. Preparing Job descriptions helps you with clarity and clearing your cobwebs around the role. Job descriptions should be able to help you identify the Technical, behavioral, and Managerial skills required from the ideal person to perform the job. Some do believe formal Job descriptions are restrictive in nature for small businesses. Having some clarity is always better for transition to more formal Job evaluations, grading structure, competency mapping, etc. becomes easier at a later date. ( Please do read some of the earlier posts on similar topics.)??

?d.??????Recruiting: This is where your employer brand begins, build a good one. Small business recruiting is an opportunity to create a great candidate experience, set forth a positive and inclusive company culture, and establish your brand as a “want to work for” in your industry. This would enable your team to reach out to the top talent you need to meet your company goals, maintain a robust hiring funnel, and build community relationships. Recruiting critical talent is a leadership responsibility and HR can facilitate and take the lead.

?e.??????Talent Management: Understand your critical skills requirements to undertake your strategic growth requirements. How can you build and retain these critical skills?

?f.???????Digitalization: Understand how you can digitize your processes Put technology and digital systems to optimum use to build efficiency and productivity.

?g.??????Employee Engagement: Employee engagement is directly tied to employee retention and talent attraction. Employee Engagement is not just about organizing office parties, celebrating staff birthdays, etc. While employee bonding with team members is important, the employee is also seeking meaningful work, learning opportunities, career growth opportunities, fair and equitable policies, humane consideration of personal situations, etc.?Follow the principles of Employee first.

?h.??????Training and development: Providing opportunities for learning and development is considered one of the largest factors in employee engagement. Identify internal and external training facilitators to develop core skills required for the future. (Some of my earlier posts provide suggestions on retaining such trained talent.)

i.????????Organisational culture: build a high-performance work culture, which provides employees the support and resources to provide their best at work. Establish fair, transparent systems and processes that encourage collaboration and teamwork. Ensure employees trust and believe in your values and ethical standards and follow them meticulously.??

?Lastly, learn the art of balancing/maintaining confidentiality and openness. There are strict areas of IP protection, contract protection, etc., which need to be very securely and secretively guarded. Data protection and identifying critical areas of the business vulnerable to data breaches, leakages, and industrial espionage need to be closely understood and monitored.

As your organization matures, run periodic surveys (Culture survey, Engagement surveys, Business process excellence surveys, etc.) and ensure you follow the PDCA cycle.

?As your business grows and complexities grow, build a sound foundation with good HR & organizational practices.