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Oh wait, they don't have one. Talk about not having a seat at the table.
All joking aside, news like this helps me to refocus on the fact that many companies do not have an active HR presence. As a result, we don't get to influence their evolution. In a hot industry such as tech, particularly in the social space, that could be to everyone's detriment.
For example:
- The industry has been highlighted (on this blog and elsewhere) for its lack of diversity.
- It also faces a skills gap, resulting in a war for talent, particularly for engineering and coders.
- Many companies are contemplating how to integrate social networking platforms into the enterprise, along with struggling with issues of how to use these tools appropriately in the workplace.
- The tech industry's influence is extending beyond its space, impacting federal legislation, such as the recently signed Jumpstart our Business Startups Act, as well as educational curriculum.
These areas--recruitment, diversity and inclusion, talent management, training and development--is where Human Resources professionals can be of value to the industry as a whole and to fast growing start-ups in particular.
And there are some out there. My good friend Matt Cholerton is a HR practitioner who's worked for several start-ups in Silicon Alley, which is New York City's own version of Silicon Valley. He offers a view into its mindset at his blog; check it out here. Without enough people in place, however, HR professionals can't elevate an industry that right now has an outsized influence in the business world.
How can you convince someone of your value proposition when they've just won the lottery?
Image courtesy of Montage Communications
Maybe it's because the value proposition isn't valuable? I don't think Instagram's experience is (or should be representative) but they built a company with just 14 people, with no HR professionals, that was valued at 1B. That doesn't bode well for HR professionals. It also mirrors my experience with how poorly understood the needs of tech companies are by most (certainly not all) HR professionals I've worked with.
ReplyDeleteHR professionals may understand recruitment, diversity, talent management, and training/development in the abstract, but if they don't do a good job of relating it to the specifics of the industry, they can do more damage than good.
There are good HR people out there who understand the tech industry as well as HR. But, at least in my experience, they aren't the norm. And until they become the rule rather than the exception, it's going to be a mighty tough sell.
Hi Anonymous,
ReplyDeleteThanks for commenting. I agree with you in that HR pros need to understand the particulars of the industry they work within. I've seen this issue play out in the HR Tech space, an area in which Human Resources professionals have a more direct influence and impact, and yet are still lacking.
I'm curious to know if the nature of tech start-ups prevent many in HR from gaining experience. As an outside observer, I've noticed that many tech firms start small, not unlike many businesses, yet stay small. Unlike other industries, say those which have tangible product offerings (e.g., consumer goods) tech firms don't have to add significant regular (as opposed to freelance or contract) members, at least not until they've reached a certain maturity level or gain significant market share. Facebook reflects this; Mark Zuckerberg went from operating the company out of his dorm room to now having a global HR team that supports it's strategic vision. They're in it for the long haul.
While many businesses are too small to need (or want) a HR
professional in-house, the tech industry at this time has a huge reach relative to its population size. Therefore, the risks and rewards associated with its actions are outsized as well. If what you're trying to do is build and sell the next hot app, then you don't need HR on your team. If what you're trying to do is build a sustainable and profitable business, it would do well to have quality, highly
competent HR business partners in place.
Victorio-
ReplyDeleteSo many topics in a concise post!
One of my favorite roles was leading the recruitment into a new manufacturing plant. I was not in HR at the time. By the time we hit about 50 employees, I realized we needed to add a true HR pro to the mix. I had great corporate support prior to that point.
We don't know to what extent the folks at Instagram used good contract HR folks to get set up, so its hard to look at this as an organization that went without HR. If they didn't, then they had leaders with great intuition who hired consistently within their cultural norms.
Hope all is well my friend!
Tim
Victorio - nice post. Thanks for the mention. You bring up some real reasons to have HR at startups, but I'd reckon those are the too often the frosting on the cake. LIke any function, when done correctly, and with an understanding to the industry and larger business context, in-house HR can offer other real tactical and strategic benefits.
ReplyDeleteSmall companies can do without HR because employees in different functions are picking up the HR duties or/and a PEO or staffing agency is hired to assist with benefits, admin, and hiring. When this works, great. If it's not broken, don't fix it.
I have heard of CEOs and technical leads spending half their day recruiting, or getting new employees signed up with benefits. I've heard employees wondering how to get their medical card, or not even having a medical plan, or not knowing what they have. Less often, but sometimes, managers need some structure around vacation for recruiting or workflow purposes, or have some boring compliance census to complete. They hate the work or don't have the expertise to put something in place that is scaleable and fitting to the organization. Staffing fees can be 3x the salary of an HR staff. The PEO 50 page generic Handbook offering is not fitting for a tech startup.
When there is enough pain, the value of HR is obvious. I'm not sure I'd want to be at a company until they had that pain. You can start to drive accountability, quality and customized/appropriate HR solutions. When in the door, a good HR person also brings other things to the table. There are hidden gains and opportunities having someone who is dedicated to deal with employee issues (hear about work blockers, get hints when and why someone might be considering leaving, need help using benefits, etc...). I hear bosses say the are connected with employee needs, and then hear from their employees that they need assistance. HR can offer best practices with sustainable pay benchmarks, put basic employment law protections in place, offer loads of time savings and expertise in the hiring process, or help to save money and provide better employee services by picking good insurance and benefit plans - for example.