The rise in the number of startups in the last few years has been steadily increasing with some stagnation in 2016 due to funding and other issues. Startup companies face different challenges compared to their peer organizations in the market such as medium and large organizations. These challenges mostly revolve around finance, sales, organization, direction and staffing. This is not niche specific for a given industry but covers all areas of the market whether the startup is tech focused, non-tech focused or a NGO. HR and staffing is one of the key challenges for startup’s especially since startup’s do not have the luxury to hire the wrong candidate for the job, have poor HR practices ruin the company culture or morale and spend huge amounts of money on HR solutions.

Finding people has never been harder but finding the right talent has never been easier. Various MNCs are still stuck with the conventional methods of recruitment and so lack innovation in this area. On the other hand, startups have no choice but to be creative in hiring, training and keeping the right talent so as to be successful and scale up the business. The first and foremost question is, Can a one hour interview, thirty minutes of discussion and an aptitude paper determine the capability and dedication of a candidate towards his/her work? We can’t judge a book by its cover. Reading it is the only way to comprehend its quality.

Similarly, there is a lot more than that meets the eye when it comes to the right candidate. This is where startups have an advantage to hiring fresh talent. Most startup’s that do not require highly technical staff for operations have the choice of hiring student or graduates. And the best types of contracts to offer students is an internship which allows them to work for a short period with the company.  This is highly beneficial for the company and the student too, as it allows both to engage and see if there is a mutual fit. If the company is benefitted from the services of this intern, it can be turned into a permanent position and gain a talent that can be further nurtured.

Compensation

Following recruitment, other HR challenges for a startup company lies in offering compensation plans. Startups might not have a huge salary structure but they offer additional incentives and an exciting work culture which is attractive for some. While some hold weekly employee engagement activities like short trips & celebrations others have trendy working environments or flexible working conditions which adds to the fun of working in a startup environment for several potential employees, even those that have experienced a corporate culture.

Instilling Vision and Values

Company values, vision and culture is another important matter for HR as well as the founder of the company to reflect on, since it is what gives the company identity today and in the future as it grows from a startup to a medium enterprise and potentially a MNC. Setting strong vision and company values early in the company’s growth is invaluable and then it becomes HR’s role to adhere to this vision and constantly embed these values into its employees through activities that reflect these values. Startups have an edge in setting as well as changing values of the company due to the flexibility and size of the company, however this should not encourage a constantly changing vision and company values.

Setting up Communication Channels

Communication is another important aspect of setting a strong ground plan for any company. Employees within startup’s can effectively communicate with anyone and everyone within an organization because of its size and less barriers to access leaders and upper management. As a company grows, new layers of management are added to account for responsibilities which can result in communication potentially being affected. The flow of communication can always be set in the foundation of the company early in its inception which can then be replicated in innovative ways as the business grows. It becomes imperative that setting communication channels amongst employees within and across departments of the company is the third most important job within a startup for HR personnel.

If we look at one of the most developing startups, BYJUS in Bangalore we would come to know more about the trend that has been followed. Through their excellent academic content and customer engagement, they have managed to grow pretty well. Recently they were funded by a big firm and have big goals for expansion.

Sourcing Staff

Another solution for startups is Professional Employer Organizations (PEOs) which enable companies to operate under an arrangement called "co-employment". Co-employment can allow startups to offer enhanced benefits while minimizing reporting and compliance obligations. Under this arrangement, people who work at the startup are considered employees of both the startup and the PEO.

Startups face various challenges due to which many of them cease to work, in the long run. The first and foremost is the lack of financial resources. Be it finance, workplace, machineries or investors, should be well strategized. Secondly, be it five or five hundred, always treat the employees of the office with respect and create a work culture in which they grow along with the company. Communication and modes of staffing also become important in running the company in its early phases and can become a decisive factor in its success. All of these areas when carefully analyzed and set in place a strong HR foundation can be set for the startup to blossom and grow to a bigger enterprise with strong values.