Hiring an HR Manager: How to Pick the Best Manager at Every Stage of the Start-Up Life Cycle

Hiring an HR Manager: How to Pick the Best Manager at Every Stage of the Start-Up Life Cycle

Photo courtesy of Mitch Bennett.

What advice do you have for human resources managers?

What important guidelines should an HR manager follow?

 

A professional acquaintance recently asked me these questions via LinkedIn. So, I would like to use this opportunity to talk about human resources mangers in my world: the start-up environment.

Before we begin, please understand that I am not the person to talk to about what it’s like to be an HR manager or to hire an HR manager for a big corporation. I’m a start-up guy.

Here are just a few people who are much better qualified to answer questions about corporate HR:

Instead, I will look at this topic from the perspective of someone hiring for a start-up. The information in this article is based on my own experiences, both from starting my own companies and from working with others to help them start theirs.

Finding the Perfect HR Manager at Each of the 5 Stages of a Start-Up

The most important point to understand is that your start-up will need different people at different stages, as summarized below.

1. The idea stage.
This is very beginning of your journey, when your business is a dream just starting to materialize.

The talent you need: Creative and innovative people that don’t have limitations.

The HR manager you need: Yourself. At the idea stage, you’ll be the one managing your team, including any hiring needed. If you can’t manage a team, don’t a start a company.

2. The start-up stage.
Your business now legally exists. Your products and/or services are in production and a few people are buying them. This is further than many self-proclaimed entrepreneurs get.

The talent you need: People you can depend on to get the job done. Efficiency is more important than creativity at this stage.

The HR manager you need: If you are organized, disciplined, and structured, you can remain the manager at this stage. Otherwise, pick a person from your team who is and make him or her the team leader. They will now be in charge of HR. Be sure to give this newly-created manager clear timelines and milestones.

3. The growth stage.
You are on your way to establishing a successful business, but more money means more problems. As revenues, customers, and profits increase, so do the number of issues your team has to deal with on a daily basis. Be prepared for your business to double in size overnight.

The talent you need: Flexible people who are willing to try every solution. Growth stage stars will be ready to experiment with growth avenues in terms of products, services, customers, geographical areas, and so on.

The HR manager you need: If you still have less than 30 employees, you probably don’t need an HR manager yet. Again, if you’re not suited to this position, you should pick a person from your team who is and put him or her in charge.

If you have more than 30 employees, then yes, you do need an HR manager. However, hiring an HR manager from a big company, corporation, or multinational is a bad move. A traditional HR manager is used to a stable workplace with clear policies, processes, and procedures. They know how to run the show, but not how to set it up. They will feel overwhelmed in a hectic start-up environment and quit.

I speak from experience. I hired an HR manager for one of my start-ups and paid him fairly, too. He still left.

The growth stage is crazy. You need someone who’s ready to start from scratch, including figuring out how to handle unmet manpower needs, train new people, set up the corresponding legal aspects, assess personnel, and take care of just about everything else that comes up.

4. The maturity stage.
Congratulations, you made it. You now have a successful company with a niche in the market and steady customers. Sales levels are manageable, true crises are rare, and you’re no longer running on coffee and prayers.

The talent you need: Steady, disciplined people who will take care of what you already have and, when possible, help you grow it.

The HR manager you need: You obviously need a good HR manager at this stage. If possible, keep the one from your growth stage. Depending on the size of the organization, you may want to promote him or her to Director.

If you hire externally, find an experienced, stable HR manager who has worked for a corporation or multinational. The kind of person who will usually join you is an HR manager who has had it with the corporate or multinational life. They want to become a bigger wheel in a small company rather than a smaller wheel in a big company, and you can give them that experience.

5. The transformation stage.
This is the stage where you want to make a major shift: a business line change, a merger, a sellout, or an acquisition. After all, failure is refusing to change.

The talent you need: Strategic thinkers that can examine the possibilities and evaluate the options in order to come up with a solution for maximizing returns. You need analysts, strategists, lawyers, and financial experts.

The HR manager you need: Again, find a seasoned HR manager who is fed up with big corporations and let him or her be the big fish in your small pond. Hiring an HR manager who can work well with consultants is also important here, as you will need at least one strategic consultant providing an extra pair of hands and eyes as you search for a new path.

I hope you have found this article helpful, whether you’re an entrepreneur or an HR manager considering your options.

If you have any topics you would like me to cover on future blog posts, or if you disagree and want to speak your mind, please leave a comment below.

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