HR FOR START UPS

Vasanthi SrinivasanIndian Institute of Management

Bangalore

Would you tell me, please, which way I ought to go from here?'

That depends a good deal on where you want to get to,' said the Cat.

I don't much care where--' said Alice.

Then it doesn't matter which way you go,' said the Cat.

--so long as I get SOMEWHERE,' Alice added

Oh, you're sure to do that,' said the Cat, `if you only walk long enough.'

Three facets to Managing people in start ups

• Impact and influence of founders characteristics • Manner in which new people are brought in to

the organization and managed (selection, socialization, performance management and feedback, allocation of roles and responsibilities) --- HRM function delivered by operating managers

• Structures, systems and processes – HR department

Do entrepreneurial firms differ?

• Life cycle has an important role to play in differences in HR practices

• Nature of ownership impacts • Founder’s foot prints take time – last up to 25

years• Entrepreneurial firms need to evolve their

own HRM practices – copying large firm practices does not make you a large firm

Challenges in family managed firms

• What is your role ? Are you an owner, a manager or an owner manager?

• On what areas, are you – Responsible– Approval – support– Consulted– Informed

Stages of growth and HR challenges

STAGES OF GROWTH OF AN ENTERPRISE

• Growth through creativity• Growth through direction• Growth through delegation

GROWTH THROUGH CREATIVITY

• Each stage has a unique HR challenge– Hire people known, often for lower compensation– Ability to do multiple things– Compensation – ad hoc, based on criticality – High autonomy, lack of procedures, close knit– Documentation weak

GROWTH THROUGH DIRECTION

– Norms/standards– Strong performance management processes

linked to incentives – Succession and delegation– Definition of jobs and responsibilities– Need to attract talent w/o jeopardizing existing

loyalty– May have to exit some employees/make

compensation corrections

GROWTH THROUGH DELEGATION

– Variation across divisions– Competence of the managerial /technical staff– Leading from afar-- CEO– Strong reporting structures for control yet

autonomy– Need for HRM practices of be integrated