How can startups attract and retain talent?

This is a common question I get from several start-ups. Start-ups feel that they are competing with large companies for talent and that this is a un-winnable battle.

Not true — in my opinion. But it does require a lot of hard work of  entrepreneurs to attract and retain good talent.

Here are some thoughts, suggestions and ideas:

  • In my opinion, monetary compensation is not the only or most important driver for people deciding about which job to take up. Start by not playing-up the role of money beyond reasonable limits. Yes, there is a base level but beyond that most team members will seek something more! It is for you to seek out what those are.
  • Look for people who do not measure their self-worth by the salary they earn or the vehicle they drive or the phone they own. Look for people who value their creative talents and wish to feed and nurture them. Look for people who are not carrying too much “baggage” — “baggage” which forces them to focus only on short term monetary gains. “Baggage” could be heavy loans, a high-cost and aspirational lifestyle, a social network that encourages comparisons with others etc.
  • Start-ups need to communicate a vision and purpose for the organisation as well as future for their team members that is convincing and something with impact that is worth pursuing. Fortunately, there are many people who aspire to contribute to changing the world — the question is if you can help them do that.
  • Start ups must leverage their strengths. One strength is flexibility and ability to act fast. So can you structure an employment arrangement that is customised to suit the employees other life choices? Can you offer flexibility in the job? Are you willing to listen to the employee’s needs and explore ways to tailor the job for them? Can you act fast to close the deal? (Big companies will not be able to do this beyond a point.)
  • Many people leave their jobs because they have a difficult boss. Can you be the best boss in the world?
  • Many people leave jobs because they do not like the work environment and culture. Many will stay on because they like their team and work environment. What kind of a work culture and environment are you building? Is your team getting along together — do they constitute a great peer group?
  • Can you spot talent in young people without track record (and before they are spotted by others) and offer them responsibilities that a big company would never offer?
  • Can you identify certain talents in people to take up a responsibility when they do not have the necessary formal background or experience to do the job?  Big companies will use software, HR consultants and HR managers to screen through applications — and they will typically use key words to screen applications. They will not dig deeper. Can you beat them at it?
  • Especially in India, family members influence the career choices of employees in a big way.  Have you made the effort to communicate to family members what your company does and the great future that awaits you and your team?
  • Are you fair and transparent on matters relating to compensation, recognitions etc? You should not only be so but also appear to be so.
  • Do you take interest in the career growth of your employee? Do you offer them opportunities to grow intellectually or professionally? Are you a good mentor?
  • Many young people will look for safe, clean and happy work places that they can feel good about coming to everyday and also showing off to their friends and family. They should not feel ashamed to show their workplace. They should also feel proud to show off their colleagues. Does your workplace and their team make them proud?
  • Have you taken the trouble to plan their work profile an responsibilities so that it is an appropriate balance of routine work, learning and stretch goals, and opportunity to excel?
  • Can you offer unique learning and networking opportunities? Can you offer an opportunity to enter a new industry segment?
  • Can offer opportunities to people who have had career breaks and are getting back to work?
  • Big companies will often offer narrow jobs with very well defined roles which basically offer them the benefit of  efficiencies that comes from repetitiveness. So, many people people will feel that they are mere “cogs in the wheel”. Can you offer them a bigger role and purpose?
  • Can you leverage your school and college network or alumni network or personal friends circle? These networks typically show greater trust and faith in you.
  • Request people in your personal networks to suggest or refer potential employees. They may suggest or refer people with the right orientation given their deeper knowledge of you and perhaps respect/ support for what you are doing.  The candidate may show deeper interest because of a referral from somebody they know or respect.
  • Can you create a work environment where employees feel that they are growing continuously and not stagnant. Growth can be in terms of intellectual growth, growth in responsibilities, growth in monetary compensation etc.
  • What are you doing to to make the team members own up to the company’s goals? Do they get a chance to represent the company on various internal and external forums? Do they feel they know everything about the company and that the  company is transparent and does not keep them out of certain things?
  • Do they trust that the leadership team will ensure that everybody will get their share of visibility and rewards when the organisation succeeds?
  • What are the things you can do to reduce uncertainty? Are you visibly taking steps to reduce the risk to your team member’s jobs?  Are you working to develop buffers? Are you prioritising that ahead of other risks?

Career development: Growing in responsibilities

In my experience, typical progression of responsibilities in work environments:

  1. Carrying out tasks under supervision (TRAINEE OR ASSISTANT)
  2. Carrying out tasks independently; Taking ownership and responsibility for a task that can be done independently with thoroughness so that no further supervision/oversight is required. (INDEPENDENT CONTRIBUTOR)
  3. Carrying out complex tasks involving multiple people — in coordination and cooperation with several others but takes ownership for the task. A key distinction here is the ability to get others to participate and contribute towards taking “your” (owned by you) task to completion (TASK MANAGER)
  4. Taking ownership and responsibility for project execution — including managing resources (people, funds, infra, etc) at hand, meeting project obligations/ timelines etc; One needs to be able to plan the project, assign tasks to others, orchestrate the execution with multiple parts. (PROJECT MANAGER)
  5. Taking ownership and responsibility for “functions”  in an organisation including managing resources (people, funds, infra, etc) at hand, meeting commitments in timely manner, delivering services satisfactorily etc (FUNCTION MANAGER)
  6. Conceptualising, planning, pitching (to raise resources) and executing new projects (PROJECT LEADER)
  7. Providing leadership for a division/ program including setting up a roadmap to achieve goals, arrange resources, motivate the team, set goals, operate multiple projects towards decided goals. (DIVISION/PROGRAM HEAD)
  8. Taking ownership and responsibility for key organisational strategic objectives and chart the course towards the goals. Organise divisions/programs, set goals for the divisions/programs and facilitate/enable/empower them towards their goals. (LEADERSHIP TEAM)
  9. Setting the organizational mission/core purpose, vision and values. Championing the “offering” and purpose of the organisation. Building the core leadership team. Raising the foundational resources. Motivating and driving collective action. Setting priorities. Takes ownership and responsibility of choices made.  (FOUNDER; TOP MGMT; CEO)

Note: The above is only a typical progression for discussion purposes. In actual practice there will always be differences based on each situation. Very often the same person will be carrying out many different roles — this is especially so in start up environments and small companies.

Some interesting observations:

  • Most young people will immediately notice that they like it when they are growing in responsibilities steadily. A job that is stagnant in responsibilities can get limiting even if the tasks keep changing regularly.
  • However, the common mistake its to assume that responsibilities are “given”. They are “earned”. People who are given greater responsibilities are those who have shown that they can handle smaller responsibilities very well.
  • In some specialised professions, people may choose to remain Independent Contributors but only grow in technical excellence but not in range of responsibilities. That depends on your personal orientation. So, some organisations may have a separate career track that recognises technical excellence instead of increasing responsibilities.
  • Interestingly, there may be no correlation between the nature of responsibilities and the compensation you get. For example, in NGOs or in small companies, you may have much larger responsibilities  but with much smaller compensations.
  • It is often because of the opportunity to take on larger responsibilities that many people may chose to either quit larger companies and create startups or choose to work part-time or moonlight or volunteer with NGOs.
  • Since larger entities drive efficiencies by streamlining tasks, they tend to reduce as many activities as possible into well defined tasks. Consequently, people are hired for  executing specific tasks well. Larger companies can pay well for execution of these tasks.
  • In general, smaller entities give young people a better chance to take up larger responsibilities.
  • You will immediately notice that for students, selected volunteering opportunities with NGOs or organising large events or taking on institutional responsibilities or club responsibilities or being  team captain etc are great ways to learn about and test your abilities in taking different types of responsibilities.
  • Once you have tasted blood in terms of taking on larger responsibilities, it is often hard to slide down to roles with limited responsibilities.
  • If you are on career growth track, it is important for you to realize that you need to show ability to handle larger responsibilities progressively in order to grow. Also, you should not reject opportunities of greater responsibility thrust on you since these are mechanisms to prove your worth. Sometimes, young people seek promotions without trying to build their ability to handle greater responsibilities or build in technical excellence in their roles.
  • If you are a student, you may wish to think about what your jobs and internships will teach you in the context of the above frameworks. Do not shy away from opportunities that stretch your abilities and help you test your strengths.

You may wish to use this framework to think about:

  • Where do you stand today? What kind of responsibilities are you taking up?
  • What is your personal orientation — growth in responsibilities or technical excellence?
  • Where (in terms of responsibilities) would you like to be next and what can you do to prepare for that?