Strategy for StartUps and Others, Part-2

05.06.2016 LISTEN

Any organization, whether non-profit or for profit, whether small or large, whether a startup or a well- established and mature business, without a strategy it would drift away from its vision, mission and of course from its customers too. This is a follow- up from last week’s posting (www.modernghana.com/news/694918/strategy-for-startups-and-others-part-1.html). Here we would look at HR, PR and Process Strategy issues for StartUps and other organizations.

StartUps & Strategy for HR .
Almost every founder and possibly every StartUp employee, has a weird notion that HR is something only for big or more mature companies. Also equally weird is the notion that if you download an employment contract template, get someone to learn how to process payroll, and place a few job ads here and there, then you do not need HR.

HR or HRM (= Human Resource Management) to be more exact, is organizational process/ framework that will help you choose the right employee who is also a cultural fit, and then HRM will focus on maximizing that employee’s performance in a way that all organizational strategic targets could be reached. Your HR person (or department) should also make sure that all people are managed in accordance with all policies and procedures of an organization.

For simplicity, with HR here, I am also referring by the same name to some OD (organization development) functions and processes; but that is a topic of a long discussion on what the boundaries between HR and OD are for any organizational process. And yes, I am partial to OD superseding HR.

What you should expect from HR (ok, OD too):
(i) Headcount + Skill- Definition
Ideally the OD function should help you define the correct number and type (skill- wise) of employees needed to run daily operations, including delighting your customers. In lieu of (internal or external) OD advice, HR should perform that activity first and then proceed to do the hiring.

One of the outcomes of this exercise should be clear role definitions; unfortunately that is frequently confused by a lot of mediocre HR people, as been the same as a job description. I remember that the first time I saw a role description about 20 years ago, it was a dense 15-20 pages document for a Programme Manager role at American Express.

This Headcount & Skill- Definition activity is an iterative one and HR should also strategically foresee and define also the skill- set needed to enter into new economic landscapes, new market segments, geographies, etc.

(ii) Policies & Employee Handbook

When you have Employee Policies (same for volunteers), you should then put them all together in an Employee Handbook; that should be your HR Blueprint.

What is inside the Employee Handbook?

Clear, explicit and well- defined Code of Conduct for every employee at any level, including disciplinary procedures
Use of Technology & Social Media policies,
Communication policies- both internal and external
Employee benefits e.g. vacation rules, health insurance, etc.
Employee Performance- related procedures
Termination & Retirement policies
….

Btw, think of the strong welcoming positive effect that an Employee Handbook offers to any new recruit.

Obviously all HR Policies should conform to your current geography’s legal employment rules and regulations. Best way to do that? Hire a legal specialist or a seasoned HR professional to write or at least review that Employee Handbook.

(iii) Talent Management / People Growth

Your Startup organization will change and so should evolve the abilities and responsibilities of your employees. This is very tricky because you need to have an HR person who could coach people on their professional development and who could guide them to professional growth (in cooperation with that person's actual manager). In Startup organizations (even in non-profits) you don’t have a lot –if any- of money to promise bonuses and salary raises, but you have a green field in allowing people to try new things than will both help their personal growth and that of a company.

Aim also at improving Employee Satisfaction, please.

(iv) Performance Analysis
Everybody is talking about Performance Measurements & all sorts of HR Analytics… but the point is simple: If you properly analyze your data, it helps you not only in evaluating employees, but also in understanding the strengths of your organization and possible deviations from its vision & mission.

And –please- in any organization, do not carry on performance evaluations only once a year; if you need to do any corrections and adjustments and you do these at the speed one time per year, what do you really expect achieve? When you do a New Year’s Resolution about a change for the year to come and then you check the result on the next New Year’s Eve, well… has this practice really been that successful for you? The year has passed by…

A complete workforce analysis is considered to be a key part of a HRM Strategy and should focus on the organization, its culture, people, and the policies/ procedures/ frameworks and roadmaps that have been implemented. Doing a full-workforce analysis is helpful in analyzing the current situation of the company in terms of the elements discussed above and where you ideally want to be in the future of course.

Once again: Aim also at improving Employee Satisfaction, please.

(v) Acquisitions
There might be a need and a way where your organization might acquire or merge with another organization; that is a common and possibly very economical way for rapid expansion. You can’t wait till that takes place to define how-to absorb and integrate the new ‘inherited’ employees into your organization.

(vi) Technology RoadMap
Your HR has to choose and plan (together with IT) what kind of HR IT solutions or cloud services need to be provisioned so all HR-tasks & processes could be supported and become more efficient.

Simply put, HR should leverage the right technology environment so –for example- employee evaluations become easier to perform.

(vii) Transition, Transformation and Change Management.

This is a very big topic to squeeze it in a single paragraph or two. It is possibly a good topic for an article of its own merit.

Of course there are other things one can add here- e.g. compensation strategy etc.… effective training, etc.

StartUp Strategic PR.
You need to always thing of PR simply because if you don’t tell your story, someone else will tell it for you - and then you will not be able to control/ influence the way others talk about you.

Rule- of- thumb PR Strategies:

Press Releases: ideally each release with several point of views so it can go to very different types of publications. Something as simple as the announcement of a new hire could with the subject of a Press Release.
Social Media presence, including blogging (if you have the time).
News Articles . Sorry to say that, but if you write a news article that is 'press-ready', most likely a journalist will copy & paste it and add his/her name. But, it is your company benefiting after all.
White Papers. White papers do not need to be only about technical subjects.
Media interviews and appearances for senior executives.
PR Events – including ones just sponsored by your organization.
Crisis Management / Damage Control
……

Again, this is not an exclusive list and googling it will give you lost and lots of more information.

Caution-1: the most important PR Strategy you need to have is the one for Crisis Management / Damage Control. You never know when something will go wrong and you do not want to find during a crisis who from your organization is talking to the press and what are they saying. Plan for a consistent response and who is going to deliver it and who are their backups.

Caution-2: Please don’t confuse branding with PR. Branding is more about your company name or logo or slogan and how your product or service is positioned in the market. You can buy branding services- you can’t really buy a PR image.

KPI- setting Strategy.
KPI is short for: Key Performance Indicator.
Basically a KPI is a quantitative (and rarely a qualitative) measurement of how efficient or effective an organizational business process is. For example measuring customer satisfaction, child- diabetes reduction caused by the implementation of a relevant non-profit action, or how many product returns per month you have in a retail store etc.

Three advice-items on the topic:
1^st: Set your own baseline and decide what makes sense for you to measure at a given point in time, at what granularity level and for what audiences.

Availability of computer server XY11-Yellow might be a meaningful measure for the IT department, but I want to know what does it mean in business- ‘lingo’: is that for example availability of our website or our billing system or technical support services? I was with a telecom company where the most senior management team was provided with a scorecard that had a KPI- metric on how many SIMcards were activated per month; I am sure that was a valid KPI when activating a few thousand SIMcards was a Herculean task, but years later when you could easily activate several thousand cards daily, that became irrelevant and shouldn’t be measured or at least not been reported to that audience.

I know and I understand that setting KPI metrics is very confusing for most Startups. But, let me tell you a secret: it is equally confusing to most experts you could hire to do this for you. Just choose some KPIs that make sense for you at the time and keep measuring. In reality, it would take you probably 2-3 years to decide which KPIs are relevant to your business processes, which KPIs even make sense to measure and how to measure them in a better and more accurate manner.

2^nd. Understand your processes for what they are and remember that a process has an input, an output and a feedback loop. So, maybe you should consider having KPIs for all these 3 items? What is the point of measuring input and not output?

3^rd. Do not get obsessed with hyper-over-optimization. You might never have the perfect process and that is really ok. If you measure the right things and you start understanding your process – whatever that process is, try to

maximize its positive behavior and
minimize all negative behavior/ effects – don’t waste time and money trying to eliminate them.

What is NOT a Business Strategy?

Any vision statement of the form: “Our strategy is to be the best company in ‘name the type of business the company is in’ worldwide”. First of all, no organization has the strategy to be the worst or the most mediocre company worldwide, and second, such a statement does not tell anyone what the company does and how it will achieve that vision. So, this is not a business strategy of any form or format.
A Business Plan. A business plans might define how a strategy is implemented but on its own it is not a business strategy
A Budget o/ Financial Spreadsheet.
Any set of Targets (sales?).
Big Data. Yes, analyzing data might refine strategy strategy, but you need first to make strategic choices and then gain insight on the execution and effectiveness by collecting and interpreting relevant data.

In Conclusion
A Business Strategy is something that needs to be supported by a whole set of Strategic Planning activities in also any business process/ activity area. And like everything you plan, you need to enable its execution and you need to monitor its success. Define and use KPIs wisely.

And all your Strategies along with Strategic Planning and Execution activities, should be in a constant cycle or re-evaluation, monitoring and improvement and add value to your organization.

The 3rd and final part of this article will be available next weekend and it would be on Risk Management, including Business Continuity.

Thank you,
Spiros
About the Author: Spiros Tsaltas, a Top-Tier Management Consultant and a former University Professor (RSM MBA, CUNY, etc), is a seasoned Technology & Operations Executive. Spiros has hands-on experience on setting up all sorts of Startups both in the US and in Europe. He is an active transformational leader and strategist with extensive experience on Boards of Advisors & Boards of Directors. He is currently assisting a couple of Ghanaian companies with the setup of their Boards.

Spiros welcomes any feedback/ comments/ remarks/ suggestions via your email message to [email protected]