Talent management can be a difficult business process for many startup executives to consider let alone agree to devote time towards proper planning and execution. After all, in any startup company, prioritization of time is what keeps owners awake at night and can hurdle a company from ‘startup’ status to an official established success. But talent management IS a crucial part of business success and can actually make or break even the most promising companies if not handled properly from business inception. An alarming number of startups do not make it past the five-year mark. There are certainly many factors at play with that result, but one factor that is too often overlooked is the proper management of the building blocks that your better-equipped competitors can never completely replicate – your people & culture.
Startup organizations find themselves reaching a crux where their human capital management processes aren’t keeping up with growth and this is a critical stage that can take you down…unless you anticipate it! To ensure that your company’s culture is a positive one and that your talent management tactics are helping your startup sustain growth instead of hindering it, be aware of these pitfalls so that you can avoid them:
- Unclear, Inconsistent Compensation Plans: People want to know how they’ll be paid and what results will get them bonuses if your startup offers performance-related bonuses. Employees work because they like their jobs, but they also work for their pay and expect their employer to be consistent when it comes to payment schedules and raises based on their high quality performance reviews, if you’ve tied raises to performance reviews. Don’t risk losing your original star roster by making the common mistake of assuming that business success is incentive and reward enough for any non-shareholders. Once you grow past 2 employees, you’ll want to document a solid compensation plan that is evaluated regularly, communicated to all employees and most importantly, delivered on as promised.
- Being Inconsistent in Hiring: You’ll find it hard to attract and keep high-quality talent if you offer a candidate a position only to change your mind when they are ready to start their new job. Not only that, but if you hire candidates whose commitment to quality doesn’t match what you expect from your company and you allow that decline in quality, your company will suffer in the long run. Take the time to establish company values and objectives and strive to recruit and hire applicants who fit the profile.
- Neglecting Your Front-Line: Startups might begin with a great idea, but their fate rests in the balance of proper delivery. The output and performance of your front-line staff, the ones dealing directly with customers, is often overlooked by startup organizations. Take time to stand back from concept execution to monitor performance metrics to ensure your front-line is crystal clear on their expectations and are actually delivering on them.
- Not Setting or Tracking Performance Goals: While startups migth all have the same overall objective in mind = success; unless that is broken down into its fundamental parts for easy digestion and execution by staff, that goal can be harder to reach than anticipated. Take the time to work out what each employee should be aiming to accomplish and ensure those goals are specific, measurable, achievable, relevant to organizational objectives, and time-bound (SMART). After proper goals are set and communicated to employees, ensure managers are tracking them properly. Too often we see processes like goal management taking a back seat to startup hussle and this can be dangerous. If goals and set and not tracked then not only does it send a very inconsistent message to employees but it also makes it harder to track achievements and identify shortcomings.
- Avoiding Formal Employee Development Programs: Developing employees’ skills is often overlooked in startup organizations for fear of the costs involved; however, creating a culture that fosters development doesn’t have to break the bank. Junior employees can learn from senior staff, attend local conferences & training sessions at minimal cost, not to mention access a multitide of free resources and information online. Being committed to employee advancement & training lets your staff know you value their professional development and helps to build your company’s bench-strength. How do you start? Ask them! Ask managers to carve out time each year to ask employees where they see themselves in the future and how they would like to strengthen their skills. Review their requests and decide from there was is feasible for your organization.
Startups need to give themselves every chance of success – and that includes carving out time to create and implement effective talent management processes & strategies. It is people who can help propel an organization into the next level of growth and success. The earlier talent management measures are in place, the more likely they are to make their way into a company’s core culture and translate into aligned, engaged and effective employees.
To help startup and growing organizations monitor performance and track goals & development, we have created emPerform Express. Pre-loaded best practice appraisal templates built into emPerform’s all-inclusive talent management suite. Learn more here.