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Human Resources




By Vinisha Panwar – Regional Service Manager HDFC Bank


If Business world is an engine, start-ups are its fuel. Business industry will be more successful if the start-ups working in the industry are capable of generating business more efficiently. The business world is transforming and the most important question which arise in such dynamically changing scenario is – Are startups ready to embrace such changes on continual basis?

Dynamics of challenges faced by emerging companies have been changed. Now a days, the biggest challenge faced by the startup companies is to attract best talent and retain it. Funding is no longer a big challenge for the emerging companies especially in developed and developing nations. There are many leading startups which have faced this challenge and indulged themselves into Talent war.

For a startup, human resource plays a crucial role which is usually neglected by most of the entrepreneurs. Its human resource at startup which should invest a lot of time in building startup brand building strategy in minds of its people.

When a startup has to compete with well-established organizations for the best talent in the business industry, it has to look for more innovative hiring techniques. Out of the box HR practices can bring the best talent to a start-up. For example, as a start-up cannot try to compete with big organizations on compensation package only. It has to look for other ways to attract and motivate best employees by challenging them.

Challenges faced by Startups in HR

One area of challenge: Most of the time, in a start-up, employees feel that firm lacks clear direction and well defined business processes. Because of which, morale of employee suffers and it leads development to a conflicting climate within the organization full of internal competition and blame-pacing.

Another area of Challenge: Key people leave for other opportunities and startup has to absorb the losses involved in hiring and training their replacements. Departing employees generally share their experience with colleagues. Word of mouth marketing can positively or negatively publicize the start-up. Negative publicity make difficult for a startup to attract good talent.

HR strategies startups should have –

Precise written working agreement: Employee agreements are very important things HR departments should take care of. Usually startups get lax about such agreements. They often fail to accomplish clearly written working agreement. Startups have to clearly identify by means of working agreements who are its employees? Are some of them independent contractors? How often startup need to pay them and how much? What are their exact job responsibilities?

An Employee handbook: Every startup no matter how new it is or how small it is, should have a professional employee handbook containing work place discrimination policies etc. If any person make a complaint against employee treatment practices by the Startup, startup would be dead before it can profitably run its business.

HR has the capability to destroy any small business faster than anything else because of following reasons:

Any violation of law or wrong way of terminating a service
Harassment or any form of discrimination
Company goal and values: Every startup has its business aim for which it first come into any business industry. It is very crucial for the startup to communicate that goal to its employees so that organizational aim and values are known by the employee and they will stick to it for a long period. These actually act as a set of guiding principles for any new hire.

On boarding checklist: Most of the startups lack proper HR department, it’s very important in such scenario to have at least onboarding checklist to ensure needs of newly hired employees are taken care of in a proper way. A step to step process guide I essential for smooth functioning of hiring process.

Create an internal knowledge sharing platform: It’s crucial for the startups to create a shared knowledge sharing platform where employees can openly share any work related information. Work related expectation of the employees could be shared on such platforms.

Cost effective HR systems: Startups could use cost effective systems to keep with work remainders, managing PTO and employee benefits etc.

Outsource if HR is not your core competency: Majority of Startup struggle to handle HR tactics. Simple solution to this problem is to outsource these responsibilities and functions. Attracting talent and Strategic Recruitment is one of challenge are for Start-ups. This challenge could be tackled by following different recruitment options as per the requirement of the startup. Different recruitment options used by start-ups for hiring new talent in today’s era.


Today startups are defined by not only how they are approaching towards their business goals but also how they react in worse business scenarios. Its Human resource which not only matters in good times of startup but also it defines the organization in bad times.

Smarter the talent you got in an industry, tougher is to attract such talent towards a start-up. Rivals in such a scenario is not only the big MNCs where your prospective talent can find a lucrative job but also a possible opportunity for prospective hires to start their own ventures. Another issue apart from the fierce form of competition for talent is that if the start-up fails to attract good talent in the business industry, it will eventually fails to sustain its long term business strategy due to lack of investment.

So, it can be easily interpreted that now a days, finding a compatible talent for a startup is not an option but a crucial step for running its business successfully. As truly mentioned by Naval Ravikant of Venture Hack- “Hiring for a startup is harder than raising money”.

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