California as a region has shown a marked growth in startups and online businesses. One of the key issues being raised on an ongoing basis is the fact that startups and entrepreneurs may be exceptionally good at what they do, but that they are not the best at looking after the admin and generally those who suffer are the employees.
Wages are paid late, there is always a mad rush at month end, followed by a litany of complaints resulting in high staff turnover. These are the common challenges for startups in the region and one of the defining aspects of HR gone wrong. Whether you are in sunny Southern California (socal) or Sacramento (sac) look at taking those business functions that you are not professionally trained and experienced in, off-site.
Taking Human resources off site:- outsourcing
Many a business has chosen to hire a team of HR experts and build a highly qualified in-house team. This is a costly initiative and will take a great deal longer than simply outsourcing the HR function to a well-known professional firm, allowing the entrepreneur or startup to focus on those things that they do best. Driving creative design processes or innovating beyond last years products, making us aware of the services that we cannot live without. This is the entrepreneur’s lot in life. Keep the HR simple and find a company that can provide the following.
This is one of the most important aspects if not the primary reason that employees will keep coming to work. They may love your product and be great at providing the service that you market and sell, but if they are not getting paid the right amount on the right date then you are likely to experience labor issues. There are many professional software payroll packages out there that will do the job, but if you are going to outsource your HR then this will be one of the key things that you want taken care of.
- Training and staff development
Developing the specific type of employee is critical for startup success. Keep it simple, let the firm know what it is you need from an employee, be specific and detail the technical skills required, as well as the person and specific entrepreneurial character traits that you are looking for. Early start up development will require higher levels of commitment from staff than in one where hours have normalized. Either have HR find the right staff or you will need them to develop such character traits or technical skills in-house.
- Hiring and firing
If the outsourced HR has got it wrong, then make sure that they are able to deal with this and can run the recruitment and employee dismissal/retrenchment process. These are complex often untidy processes if not managed with strict adherence to labor legislation and law.
- Retaining talent
Having a clear plan for retention of desired staff will be further reason to have a professional run the HR component of your start up. Once skilled, trained, and proficient in the process of your business your staff will become valued on the open market and as such you need to keep them happy. Benefits, career progression and even the odd gym membership can go a long way to keeping staff happy and can be a full-time job to manage to implement without favor.
- Managing the firm’s health and safety (esp. through Covid)
A professional HR entity will be clued up on the current Covid restrictions and government guidelines for either working from home during covid or site-based work with covid safety measures instated. The wearing of masks, using sneeze screens, and frequent hand cleaning sounds simple enough but will be a nightmare to implement alongside trying to meet the latest deadline or testing the newly developed app you are selling.
The options are endless and professional socal human resources consulting abounds, so choose well and ensure that they have the requisite pedigree and positive reviews.
Why Internal HR is Overcomplicated
In this day and age where outsourcing is so common and the process has been streamlined and perfected for the smallest of startups to the largest of firms, keeping your HR internally can actually be more trouble and complicated than it is worth.
The alternative to outsourcing functions such as these is to employ a dedicated HR manager, this can cost a great deal more than having a consultant on-site for less time. You will also probably need more than one member of staff to run your HR, and this is where you will find yourself on a slippery slope towards over staffing. The costs of keeping HR in-house will not only be associated with staffing, but you will need the requisite software for payroll and benefit tracking. This is another expense that will serve to make having an internal HR team a cost that many startups cannot afford.
One of the biggest issues raised in employment with internal HR is the bias in internal relationships and even in the hiring process. If HR is a constant department there will be relationships built with other staff members, which can and will affect the HR process if one is not careful. Lastly, the time that it has been noted to deal with recruitment can be a major downfall of the internal HR. Hiring and interviewing is a detailed process and more often than not senior management as well as HR will be involved in the process. This is time that could be better spent on the core business. Furthermore, dealing with absence, sickness, and returns to work are all huge time constraints and will all involve a line manager to some extent as well as the HR staff member. It is over-complicated.
A consultant with a team of experts and clear terms of reference will be able to do all of this, while ‘the main business’ of your business continues.
The aim is to grow your startup and generally, the key skill that you as a business originator may have is the creative or design and planning, it is always best to then use a professional for what is a complex role, dealing with people. Reclaim your time by ensuring that you have a professional team looking after your people.