All companies face their share of human resource challenges. For rural facilities, it might be attracting well-qualified employees away from big-city employers to places like Moses Lake, Boardman or Idaho Falls. For large, prosperous, well-established companies, the challenge might be finding enough bright, well-trained young candidates to replace the skill sets that will be lost as the key managers and technicians of the baby boomer generation retire.
Many startup companies face all of these HR challenges, plus others unique to their status as new companies without a lengthy track-record of policies and proven best-practice procedures. The purpose of this article is to identify some of the unique HR challenges startup companies face, and to suggest some techniques that will help eliminate those challenges before they become major headaches.
Let’s start with a hypothetical case study to illustrate some of the special human resources pressures many newly-created food processing companies can face. Company A identifies a need within the natural food marketplace and brings a line of organic, essential fatty acid-rich popcorn products to the marketplace. The company secures a number of contracts and begins production. The owner is under pressure from his investors to show immediate profitability. His anxiety is expressed through frequent visits to the production floor, during which he is often critical of his workers and supervisors and issues a series of sometimes-contradictory suggestions, which are interpreted as orders by his production staff. The next time he appears on the line, the owner expresses surprise and displeasure at the changes his staff has implemented, and threatens that heads will roll if things do not improve.
In the absence of clear direction and well-defined business systems, morale suffers, and a climate of internal competition and blame-placing, rather than teamwork and mutual support, takes hold. Key managers and production leads leave for other opportunities, and Company A must absorb the expense and productivity losses involved in recruiting and training their replacements, further impacting profitability. Even worse, as these departing employees share their experience with colleagues, negative word-of-mouth makes it even more difficult for Company A to attract competent employees.
The key to breaking this negative cycle is to be proactive, rather than reactive, and to get a clean business system in place before the first packages roll off the production line. Such a plan includes well-defined HR policies and procedures, a competent leadership team and a well-defined chain of command. Startup companies that lack an unlimited HR budget could consider hiring one or more MBA interns from a local college to set up their operations-side business systems. An experienced, competent plant manager is another essential; consider hiring a recently-retired or downsized plant manager who still wants to work part-time, an “old bull” to teach your “new bulls” the nuances of production efficiency.
For the owners of many startup companies, finding the time to focus on human resources and internal relations is a difficult challenge. But as the above example illustrates, in the absence of an effective plan for this aspect of the business, it’s easy for problems to spiral out of control. Taking the time now to build a culture that allows all employees to grow and prosper will save uncounted problems later in the life of your business. It’s just as easy to create a positive HR cycle as it is a negative one.
If you work for a startup food processing company and would like to explore how to build an effective HR plan, please contact me at 503-327-2200 or firstname.lastname@example.org. I’ll be glad to help you get started.