Amidst start-ups trying to grow up fast and middle-aged enterprises yearning to return to innocence, there are those experiencing adolescence, the unicorns with their growing pains. They have tasted success and scale and crossed the chasm. They have great expectations and greater anxieties to deal with. But there are no guarantees that what got them this far will get them to where they want to go next. The recipe that got them this far is a combination of brilliance, inspiration, perseverance and the zeal of their founders. To maintain momentum, they need to keep finding talent that can fuel their growth engines. Talent and Culture is as fundamental to their ambitions as deep pockets, intellectual property, or the early dominance they have achieved in their niche markets.
Take Amazon, which has scaled and retained its start-up mindset and successfully navigated competing pressures to deliver cash flows, ideas and leadership talent that can help it capture newer markets. It is not by accident that Amazon has gone from being a book seller to a digital device to an enterprise infrastructure provider and almost certainly a healthcare disruptor in the future. Hiring, retaining and engaging great talent at each stage of the journey has been a key reason for its success. No wonder Amazon and Google consistently figure as the role models that inspire start-ups, unicorns and large traditional enterprises alike.
Growing pains are inevitable, as scale demands efficient processes, functional specialization, and formal mechanisms of collaboration, the very elements that can create an inflexible, bureaucratic culture if left unchecked.
Each unicorn on its way up follows its unique path to attracting, retaining and engaging talented individuals and teams but there are common pitfalls to avoid and some provocative advice from the best in the business. As the talent pool expands beyond the founders and early converts to their mission, the culture that sustains a 50 people start-up must give way to a culture that can inspire a 5,000 person company.
I recently heard Patty McCord, former chief talent officer of Netflix, share her experiences at a Wipro event in San Francisco about navigating this journey, and added a few of my own thoughts:
- Think of HR processes and policies as products and redesign them as you would redesign a product through various stages of a Minimum Viable Product, pivoting as often as necessary to get closer to your success goals.
- Ignore traditional HR wisdom if you need to. Challenge assumptions behind procedures and policies that maintain status quo. From policies designed to discourage employee lawsuits to expense approval policies, evaluate the possibility of eliminating or automating non value added HR processes and controls.
- Design your talent strategy backwards from your business strategy. Go and hire the talent you need to win rather than retrofit your strategy to the talent you have – there are no second chances in some fast moving markets and sometimes, oblivion is the only second prize for those who move too timidly about the talent you need to win.
- Gender pay gaps are surprisingly easy and simple to fix if you have the commitment. The lasting value that it creates far outweighs the cost of writing the check that levels the playing field for pay. Just write the check, as Patty says.
- Compensate employees based on their ability to create value, even if means turning the traditional wisdom about consistency and benchmarking on its head. Patty suggests not going by someone’s last earned paycheck, but rather basing it on what they bring to the table.
What are your biggest challenges as you prepare to scale to the next level? We would love to hear more about your experiences with hiring, managing and engaging your talent as the strategic launchpad.