It sounds fairly obvious, but as much as we talk about company culture, we forget that regardless of industry and no matter what size their workforce may be, this construct – and indeed the strategic and business direction of the company itself – is defined entirely by the people who work there.
While there’s no doubt that hiring is one of the most critical competencies for any business today, nowhere are hiring mistakes more costly than at startups.
At high growth, early stage companies, the realities of limited cash flow and headcount mean that few can ill afford the costs that come with replacing a bad hire, which can often run to 2 or 3 times the employee’s annual salary (or more, in some cases).
Gimme Shelter: Setting the Stage for High Growth Hiring.
Having the right people in the right roles can make or break a startup’s success, and failing to fill open roles quickly can stunt a high growth business’ ability to operate efficiently, scale effectively and have a significantly negative impact on the company’s overall valuation.
And yet, for some reason, how to hire remains one of the few parts of running a company that’s inexplicably left uncovered by almost every business school curriculum, leaving many executives and leaders to outsource or ignore talent acquisition entirely.
Those executives who choose to put their head in the hiring sand, however, are rudely awoken when their company runs into the first sign of trouble. The majority of CEOs, however, recognize just how important recruiting and retaining the right people is to their overall business success, yet remain woefully inexperienced and ill prepared to actually implement a successful talent strategy.
As the CEO of a startup myself, I’ve become intimately familiar with the manifold challenges and demands of being an entrepreneur, leading a growing business while simultaneously leading a growing workforce. I know first hand how important talent acquisition is to our overall success.
I’ve learned that our business – and our bottom line – is inextricably intertwined with making the right hiring decisions. I’ve also learned that by constantly prioritizing our people, we’re constantly improving our profits. The two aren’t mutually exclusive – the overlap between the two is almost absolute.
Satisfaction: 6 High Growth Hiring Hacks For Startup Success Every Leader Needs To Know.
As someone who’s spent a lot of time thinking about how we can make our recruiting function even more effective and efficient while ensuring that we’re making the right hiring decisions while not sacrificing quality for speed, I’ve given quite a lot of thought to the intersection of business leadership and talent acquisition.
Over the years, I’ve come to some fairly concrete conclusions about what works (and what doesn’t), and boiled these down into a few simple rules for executives who want to learn how to hire for growth and ensure that their businesses have the people they need to scale today – and set the foundation for the future successes of tomorrow.
Here are my top 6 rules for winning at high growth hiring:
6. Tumbling Dice: Putting Your Money Where Your Mouth Is.
If you truly want to attract the top talent on the market, then you’ve got to actually commit resources to recruiting; remember, you get what you pay for, and no high growth company can afford the opportunity costs associated with underfunding this mission critical function. The flat out truth is that hiring organizations, just like every other business unit at a company, need a budget if it’s going to have any shot at success.
Since hiring is just as integral to a company’s success as sales (and in fact, the two are closely correlated), and funding this function can make or break a startup’s ability to raise additional funding in the future, this is one area that requires a significant investment of time, resources and executive support.
This should be reflected in the budget; investing in a team of talented recruiters, emphasizing interpersonal skills and screening for culture while ensuring that your talent team has the tools and technology seems like a pretty obvious business case for really any high growth business.
The more quickly and effectively your recruiting team can start hiring workers who are a good fit in terms of skillset, experience and alignment with the company’s mission, vision and values, the better positioned your company will be for growth – and to survive (and thrive) in the future world of work.
5. Beast of Burden: How To Eliminate Bias From High Growth Hiring.
Executive leaders must actively work to engineer all bias out of their screening and selection process, which can be among the most difficult challenges any company executive will have to face while building a business. While it’s never easy, eliminating bias from the hiring process is absolutely critical, and should be seen as an imparative for any future looking CEO or forward planning senior leader, period.
Many companies often overlook this step because it’s hard for leaders to admit that they’re not perfectly impartial and completely objective in their hiring process, and admit that bias exists in the first place – which is almost always the case. But you can’t fix these potentially fatal flaws without acknowledging them – and the first step to fixing this problem is to admit you have one. Period.
While removing hiring bias can be something of an imperfect science, every organization should start by creating safeguards against unconscious bias early in the process.
Some examples include withholding information about a candidate’s gender, race or other protected information during the initial resume vetting and candidate screening process; hosting awareness trainings and creating affinity groups aimed at increasing diversity and inclusion, and creating a process that’s as objective and balanced as possible.
Intolerance is the one thing no leader should ever tolerate.
4. Can’t You Hear Me Knocking? Diversity by Design:
Diversity can’t be seen as an associated outcome of recruiting, but rather, as a deliberate part of your talent acquisition strategy, with inclusion initiatives becoming increasingly imperative for building a company culture and successfully growing your business and bottom line.
Diversity isn’t accidental. If you expect that diversity just kind of happens naturally, you’re in for a fairly rude awakening, my friend. CEOs, therefore, need to take an active role in setting the direction for diversity throughout a company. This often starts with defining diversity targets and specifying specific actions or initiatives to proactively promote a balanced workforce. For leaders, this means ensuring you’re deliberately seeking out candidates with different backgrounds and disparate experiences, both personally and professionally.
Diversity isn’t just a human capital issue. It’s an intellectual capital one, too; and bringing broader viewpoints to the company as a whole means hiring a workforce who not only looks different, but thinks different, too.
3. Time Is On My Side: Why Process Is Everything.
Process is one of the most critical, but often one of the most overlooked, parts of successfully ramping up recruiting at a startup or high growth organization. Having a carefully constructed, standardized and scalable hiring process is really the only surefire way to guarantee your organization’s people processes are working as efficiently and effectively as possible.
Your recruiting process should leave no room for interpretation or ambiguity; it must include explicit instructions and detailed procedures for every single step of the recruiting process, from sourcing to screening to offer negotiation and onboarding, and these standard operating procedures must be consistently implemented across all departments, hiring stakeholders and senior leaders.
Creating and defining these standards not only speeds up the hiring process, but it also prevents many mistakes by eliminating individual recruiter or hiring manager error, and can ensure a better candidate experience by creating a streamlined, standardized and seamless process that can often mean the difference between an accepted offer and a rejected one.
2. Under My Thumb: Why Outbound Is Everything.
In the past, many organizations have relied on the traditional post and pray mentality for talent acquisition, but we all know by now that the best candidates almost never proactively approach a business.
If you want to snag the best in the business, you’ve got to find them, first. This increasingly means outbound strategies are key to systematically finding and engaging the best fitting candidates for any given position or business.
For startups, the shift to outbound recruiting requires the intelligent use of resources, particularly when it comes to targeting the right candidates instead of simply casting the widest possible net.
For CEOs and executives, outbound success requires insisting on (and funding) a dedicated recruiting initiative designed explicitly for proactive sourcing, pipeline creation and candidate development. These initiatives should be reinforced with a strong and robust internal referral program, which is unquestionably the best way to uncover top talent and find the best passive candidates on the market. Creating a culture of referrals requires executive buy-in, active participation and constant reinforcement, but the results of prioritizing these efforts almost always pay off.
Using a carefully structured, data-driven approach to sourcing, engaging and selecting the best candidates for their business gives companies much more control – and choice – for much less time and bandwidth than screening through a stack of random resumes from candidates who don’t even remotely resemble anyone you’d ever consider hiring.
In recruiting, less is almost always more – if you’re smart about your outbound efforts and remember that in talent acquisition, if you build it, they won’t always come. That’s why you have to go out and find them, first.
1. Street Fightin’ Man: High Growth Hiring Is A Winnable Competition.
Every startup wants to beat their respective competition, which is why it’s essential for CEOs to remember that hiring is, inherently, a highly competitive action.
No business out there operates in a vacuum, and every enterprise faces cutthroat competition for hard-to-find talent. If you’re talking to a candidate with an in-demand skillset, there’s a good chance every one of your competitors is, too.
Beating the competition for the best candidates means putting a premium on speed; the competitor who is able to hire the most people the fastest will face far better odds at being able to have the flexibility and agility to produce better products and win more customers.
The less red tape your candidates have to go through, the less chance the competition has of getting them in process or developing an offer in time – you might be competing for candidates, but there’s no competition if you can consistently close offers before the other guy can even make one.
For CEOs, tracking the employee growth, competitive positioning, employer brand and hiring patterns of direct competitors can provide some of the most valuable business intelligence out there.
For example, job postings can often reveal a company’s future financials (e.g. if a startup suddenly advertises for a slew of open SEC reporting positions, there’s a pretty darn good chance they’re about to IPO) or strategic direction (e.g. a shift in open positions from traditional software engineers to mobile developers with expertise in a specific software language can almost always give away a product release or roadmap).
CEOs need to stay on top of these talent trends if they want to stay on top of the competition – and ahead of the hiring curve. The best businesses always get there by having the best talent; company performance and recruiting performance are almost always inexorably intertwined.
Remember: you’re only as good as your last hire, and if you’re running a startup, every one of those hires could mean the difference between long term success or short term failure. When it comes to choosing wisely, there really is no choice for business leaders.
If recruiting isn’t one of your top business priorities, chances are, you’re not going to be in business for very long. Because the cost of making the wrong hires is one that no startup out there can ever afford – which is why investing in recruiting is the best bet you can pretty much make in business.
About the Author: Sheeroy Desai is the co-founder and CEO of Gild; with over 25 years of experience, Sheeroy is a technology industry veteran who has guided a number of innovative companies in transforming markets to deliver exponential growth. Gild is Sheeroy’s third startup, which he co-founded with Luca Bonmassar.
Sheeroy is responsible for driving the company’s strategy, vision and culture. Sheeroy was a founding member of Sapient (NASDAQ:SAPE), a global services company that helps clients transform operations, marketing and technology. Sheeroy served as Sapient’s Chief Operating Officer from 2001 through 2007.
Sheeroy started his career in 1987 at Cambridge Technology Partners (CTP), a pioneering systems integration firm focused on client-server technology. CTP went public and was eventually acquired by Novell. Sheeroy holds a B.S. in Electrical Engineering and Computer Science from MIT. When not working Sheeroy enjoys biking, skiing and cooking.
Follow Sheeroy on Twitter @Sheeroy or connect with him on LinkedIn.