Being part of a start-up is usually pretty challenging. It often feels like there is never enough time or resources, and the pressure to succeed is enormous. Unsurprisingly, a start-up does not always have a dedicated HR department: it’s not hard for human resources (HR) to fall down the priority list when you have so much else to concentrate on and the stakes are high.
However, integrating HR into your start-up’s core business model from the beginning is critical to business growth and success. Proper HR processes ensure you get the right people in the right roles, comply with legal and tax regulations, and create a positive working culture, all of which lay the foundations to enable healthy business growth in the long run.
Here are eight tried and tested HR strategies that benefit start-ups.
Table of Contents
1. Identify The Skills Required By The Business
Spending time thinking about the skills you need in your business now and those you might require in the future is a HR strategy that pays off when recruiting your very first employees. Business success depends on having the right people in the right roles at the right time. Using HR practices can support businesses to take a longer-term strategic view of what is needed, helping the hiring process run smoothly and avoiding bad decisions that will impact the business in the long run.
2. Keep On Top Of Documentation From The Start
Having employees involves managing a lot of essential documentation, which needs to be secure in line with data privacy regulations. Documentation such as contracts, personal details (including bank and right-to-work details), and performance records should all be collated and filed in a way that is accessible and can be scaled when your business grows. This also applies to keeping records for areas such as annual leave. It might be tempting to approve time off on an ad-hoc basis when there is a small team working closely together but it can be harder to remember what people have done and what you agreed and didn’t when the team gets bigger. Starting your business with clear documentation for managing absences avoids misunderstandings further down the line. An employee handbook is a valuable tool for this reason.
3. Be Legally Compliant
Whatever a business’s size, compliance with legal and tax regulations is essential to avoid significant fines or even legal action that could threaten the company’s existence. A key HR strategy for start-ups is to have policies and procedures in place from the beginning to ensure compliance. On a basic level, this includes Employer’s Liability Insurance, enrolling employees in the Workplace Pension, having employment contracts, and ensuring that everyone’s data is fully protected. HR professionals can provide essential advice and guidance in these areas and avoid you having to make costly changes to your structure or set-up later.
4. Offer Creative Compensation Packages
Using HR knowledge is essential for the recruitment process in terms of knowing where to find the best talent, what skills are required to help the business succeed and how to assess an individual’s suitability for the roles you need to fill. Through benchmarking and industry knowledge, HR departments can also provide intelligence on appropriate compensation and employee benefits and generate creative ideas to attract candidates. Enhancing a financial offer with non-monetary benefits is significant for start-ups where funding may limit a business’s capacity to compete on salary. Creative ideas can include employee discount schemes, perks related to the company or even an equity stake.
5. Create A Positive Workplace Culture
Integrating HR into the leadership functions in a start-up is a crucial strategy for ensuring you are creating a business with a positive workplace culture. When everyone is working hard to help a new business succeed, it can be easier to forget how important it is to build company culture from day one. Creating a positive culture through a focus on health and well-being, inclusive leadership, and 360 employee feedback ensures that a new business supports, values and recognises its employees. This culture is also one that can support employees to avoid burnout and HR helps with areas such as managing absence, access to mental health support, and promoting self-care.
6. Focus On Diversity & Inclusion
In any business, focusing on diversity and inclusion has considerable benefits as it improves decision-making, increases innovation and creativity, encourages employees to remain with the business and enhances a company’s brand. Using HR policies to promote diversity and inclusion from the very start of a business ensures that this approach is embedded and will set the organisation up for future growth. HR teams can promote and manage an inclusive approach through the recruitment process, the performance management system and supporting clear and open communication.
7. Invest In Temporary Workers
Using internships, freelancers and contract workers can be an effective HR strategy for start-ups as they allow companies to be more flexible with their workforce and use people with specialist skills without the longer-term commitment. However, to ensure that start-ups get the most out of these workers, HR teams have a role in helping integrate these different types of employee into the whole business to maintain a cohesive and productive environment. The HR functions provide regular communication, define roles and responsibilities, and manage processes such as performance management and payroll, which are critical to an inclusive culture that allows all employees to make their best contribution to the business.
8. Use HR Software
Whether or not your start-up has a dedicated HR team, software such as Factorial’s HRIS (human resources information system) can automate many HR tasks, freeing up time to focus on strategic issues.
Our all-in-one software allows you to manage your team’s time, documentation, payroll, performance, and more from one place. It can also manage recruitment with our applicant tracking system and help you avoid missing anything essential when onboarding new employees.
Starting a business with HR software in place is essential for future growth. By laying the foundations for the smooth running of everything people need to perform their roles, it is possible to scale operations quickly and efficiently.
