HR is the second most common reason why startups fail, affecting 24.75% of failed businesses. It's time to learn how to recruit.
What are the challenges
Selection Process - A startup is a rather fragile ecosystem, adding new people requires a selection process that assures that you will improve what you have and don't destroy it.
Benefit package - When compared with large multinationals, most startups don't have the privilege to be competitive in wage. So, creating a benefits package is of crucial to attract talent.
Create a culture - The culture is the be all and end all of an organization. It defines the work environment, defines how do you communicate with your customers and how does your startup makes decisions. Adding new people to that culture will change it. Make sure you have the right foundation to work upon.
Identify what you need - A big part of what strategy is, is knowing how to allocate your resources. And your human resources are no different. Define exactly what you need (task by task) and then go search it.
Quality control - Quality control happens in every stage of the process. It is critical to avoid the so called "bozo explosion". You only want to hire A players. Nothing ruins a company faster than having the wrong people on the team.
Recruiting is a hard process. Defining what you are looking for is crucial. Here is what you should look for:
- EKS - Experience, Knowledge, Skills
- IQ - Smarts and Intelligence
- EQ - Emotional Quotient
And then define your ideals, which are related to your culture and your internal processes. As an example, your ideal recruit has
- The right skills,
- The ability to learn,
- The ability to create teams,
- Uses effective approaches to solve problems.
So, how do you assess EKS? You can assess Experience through the Resume or CV. Your can test Knowledge and skills and we recommend doing it by using very simple tests. You want to test the absolute minimum. You still can tell a great chef by assessing how he cooks an egg. We like to evaluate IQ through the following questions:
- Why should I hire you?
- In what way can you contribute to the business?
- Give me an example of a problem you solved and how you have solved it.
You can also test someone's EQ, however, you will know just by talking with the recruit. If you are having a good time interviewing this person, or you want to end it as soon as possible.
EQ can also be mentioned as soft skills. These are each individual's non-technical attributes that are complementary to the hard skills and can even be a critial factor for successful recruitment. Soft skills can make the difference when we think about the involvement and inputs an individual can give to the organization. We are talking about having critical thinking, problem solving capacity, teamwork capacity, resilience, effective communication, creativity, time management, among many others. You should be able to draft each position preferable individual's attributes, and conduct the interview with that purpose. For example, if you need someone creative ask an open question that makes it necessary to create something totally different.
Nowadays, rare talent is on high demand. And if you want some of that, you are competing with major corporations that are able to pay very large sums. Fortunately, money isn't everything. You can include several benefits that have higher perceived value than cost. Medical insurance, more vacations, paid training, the ability to customize their office space and cultural fit are some of the benefits you can use to persuade talented people to work for you.
Create a culture
How does it feel to work in your startup? What is the mind set? Culture is the DNA of your company. And if it is aligned with your goals, then you have the right ingredients to grow. But be sure to spend some time defining what is your company DNA, or it will define you. When you hire someone, that person will be better integrated when there is a culture. At the same time culture is a living thing and the new person will also influence culture. So it is important for you to define culture and assess fit between your recruit and your startup's culture.
Identify what you need
It is very important that your job description is as detailed as possible. Write it from experience. If you really have the need, then do it first. Try the actual job before you start hiring for it. Understand the challenges. It will make your selection process so much better. See where in your company Roadmap's does that person fit. It is important to understand the right moment to hire someone and when you should wait. Define a possible progression for that person.
You want to hire A players only, and this is why: there is a process called the "bozo explosion" where "B" players hire "C" players and "C" players hire "D" players. "A" players hire "A" players, and that's where you want to be. Don't hire to fill a position, just because you have a deadline. If you don't have a complete fit, our advice is don't hire. It is better for you to continue the recruiting process, then it is to have someone in your company that creates all sorts of problems. Even after the recruiting process, you need to keep the house clean. So the quality control is important, regardless if you are currently hiring or not.
It is important to understand the intrinsic motivation factors that work best with your team. The theory of Needs, by McClelland, states that every individual is motivated by 3 things:
Each one of us is more motivated by one or two of these factors. We highly recommend that you to test your employees on these motivational factors. It may help you manage their motivation and help you find the roles where they will excel. In some countries, these tests are not permitted or require special approval. But just being aware of this theory will help you manage your workers better.
HR are extremely important for a startup as you can read in this article about Reasons Why startups fail. However, you usually only think about recruiting processes for employees. Why not investors, clients, shareholders? Often problems in Human Resources occur among the top level: Founders, investors. So, why don't implement similar processes when you are searching for investors or co-founders? Hope you liked this article. We also recommend you to read: