This article was originally published on the BambooHR blog by Brian Anderson.
It’s one thing to recognize that your organization needs to do more—get more clients, spend more advertising dollars, fix more software bugs, create more ad campaigns. It’s another thing to organize the teams that make it possible to achieve these goals. If this seems like a lot for one person to figure out with a single Google search, well, you’re right. It takes a concerted effort from everyone in the leadership team to decide on a direction and hash out the details. But without this advance preparation, your team expansion can become a serious long-term liability.
In the Startup Genome Report, researchers from UC Berkeley and Stanford found that 70 percent of the startups they surveyed tried to scale too early, before other fundamentals of their business were in place. The report also concluded that premature scaling played a part in 90 percent of failed startups.
Why is this such a prevalent problem? It comes down to the fact that these decisions don’t happen in a vacuum. When there’s pressure to improve performance, it can be tempting to use hiring numbers as a façade of success. For example, the pressure could be on a startup founder to provide favorable indicators for the next investor briefing or a mid-sized software company to respond to countless requests for an additional feature and deliver before their competitors.
But hiring isn’t like flipping a switch and starting full-scale production. “Depending on the position, it can take up to nine months to really start getting ROI,” says Morgan Lyman, Talent Acquisition Partner at BambooHR. This hiring investment includes the cost of hiring, which SHRM estimates to be an average of $4,129 per employee, as well as the working hours current employees spend training new employees. “Unhealthy and premature turnover means a huge loss of company assets and resources,” Lyman explains.
Instead of covering long-term uncertainty with a quick win, spend time determining how your organization’s vision, values, and culture will operate on a new team.
Vision—Scaling Teams with Purpose
Scaling a team isn’t a one-size-fits-all process. Before you can succeed at scaling up a team, you need to identify the reason you need additional people on that team. Do you have a fully functioning department with excellent leadership and need more people to increase the capacity? Or are you expanding into unfamiliar territory, and you need someone with skills and insights that your organization doesn’t have? In many cases, it’s a little of both.
You need to define the nature of your team’s growth well before you start crafting job descriptions for new team members. Rushing the job description is a common mistake when organizations are hiring under pressure, but nailing down the details can lead to important savings in the long term. “Sometimes, making sure to be as thorough as you can with a job description can result in realizing you might not need to hire for that position, period,” says Lyman.
One example of this situation comes with tasks that can be automated. If the single HR person in your organization can’t keep up with the time-off requests now that you have too many people to track on a single Google calendar, it may be more efficient to find software to streamline the process than it would be to hire additional HR assistants and train them in a tedious and complicated spreadsheet process.
Values—Scaling Teams with Intrinsic Motivation
If your organization’s vision is what you want to accomplish, then your organization’s values describe how you want to accomplish your vision. Long-term success in scaling a team requires an alignment between what employees value and what the organization values. Without this alignment, you’ll have a hard time finding and keeping employees on your new or expanding teams.
You don’t need to put your values into words on a poster for employees to understand what they are. Their experience at your organization will prove what you value more clearly than any list or mantra. If your organization values profit above all else, that will show in how it treats employees and customers. If your organization values the employee experience from the hiring phase onward and acts accordingly, it will reflect in the reviews that current and former employees leave on Glassdoor and other review sites.
While employer values and employee values are two sides of the same coin, they still have important differences in how they’re expressed. This is where trouble may arise. For example, a small organization may come to value employee autonomy, a culture in which employees work together, speak their minds, and come up with great solutions without waiting for someone else to go first. As this organization begins to scale their team, they plan on keeping a flat structure, where everyone works autonomously without layers of bureaucracy to slow things down.
But as they put this plan into practice, they discover that it’s harder to provide oversight for such a large group, making it difficult for everyone to understand the vision and for leadership to make corrections. They discover the difference between autonomy and independence—just because employees can keep working without being monitored doesn’t mean they can make any choice they want without affecting the trajectory of the group.
Autonomy, communication, and many other individual values require different strategies to fully express themselves in a group setting. As you scale your teams, it’s important to recognize the limits of these individual values and support them with effective management structures. While optimal team size will vary from position to position, try to keep management to a series of small- to moderate-sized teams. Every employee should have a team where their efforts can be recognized, and every team should have a clear connection to the organization’s leadership and values.
Culture—Scaling Teams for Future Growth
Articulating your vision and living your values helps create the final ingredient of successfully scaling a team: an effective culture. While there are many definitions of culture, we prefer this one:
Organizational culture is the summation of how people within an organization interact with each other and work together.
Like vision and values, the most effective cultures have a purpose and a direction. Ask yourself this: what kind of workplace do you want to create for your new team? How will this new team impact how current employees communicate and collaborate?
Some organizations try to create a culture by basing job descriptions on successful team members. A more successful method of recruiting is to search for complementary people to your team members, not clones of your team members.
Whether you’re hiring a software engineer or a support hero, the job position will have a wide variety of qualifications that make for a successful candidate. Instead of basing a job description on a person, take a careful look at the skills and attributes that make the person successful. How do the new hire’s attributes compare and contrast with the other members of the team? Do they shore up their teammates’ weaknesses, or do they magnify them?
As you grow, it’s important to be careful with your referrals program. While asking employees for referrals is one of the quickest ways to hire, people tend to be friends with people who have similar backgrounds, attitudes, and characteristics. Overemphasizing referrals can lead to multiplying weaknesses instead of mitigating them, and can reduce diversity in your organization.
Every new hire will have strengths and weaknesses. It’s important to recognize that as your organization grows, you need a plan for how your employees can grow with it. This doesn’t mean that every employee needs to be on the management track to be worth hiring; employees should have opportunities to develop their professional and institutional knowledge. Then as your team continues to grow, they can help develop their new coworkers’ capacity in the same way as your team grows from good to great.
Clear vision, lived values, and authentic culture. Whether you’re considering how to scale a startup or how to expand a single team, these essential principles make all the difference. Here are additional resources to help you put these values into practice:
- Immediate and long-term job description tips
- How to create a referral program
- Tips for improving current employee performance
- How to create a smart compensation strategy
Building a team takes more than making deals to get people to sign up. It takes planning out how that team will grow together, not just from HR’s perspective, but in your organization’s larger financial and strategic narrative. To succeed in scaling your team, you need to understand these principles well enough to make them clear to everyone involved, including leadership and management.
This article was originally published on the BambooHR blog by Brian Anderson.