We’ve dedicated our professional lives to helping HR/people leaders grow and become more successful. If our experience as educators, consultants, and coaches has taught us anything, it’s that HR in a high-growth start-up is a different—and very wild—animal relative to other types of organizations. To borrow from the late USC professor Larry Greiner’s classic framework, these firms simply don’t have the luxury of long periods of evolution where existing processes can be tweaked and refined but instead face a rapid progression of major revolutions driven by dramatically changing headcount, funding, and culture. In the face of incredible and unrelenting pressure, many leaders are tempted to eschew their own critical thinking and simply adopt the so-called best practices being trumpeted by HR influencers and high-flying unicorns well past their start-up days. This is a perilous strategy.
Effective high growth leaders understand two fundamental principles. First, they realize that in most cases they do not need to re-create the wheel as their HR problems are rarely unique and can often be addressed using a well-established, evidence-based practice. But, second, they also understand the dangers of blindly “lifting and shifting” practices from other organizations when they don’t make sense at their own organization. Of course, understanding only these two principles can still leave tough questions around when a best practice makes sense and when it needs to be avoided.
We offer four guidelines that can help you avoid the best practices that can derail your business:
1. Understand your context.
A recent review by University of Amsterdam professor Corine Boon and her colleagues suggests that the utility of HR practices is determined in large part by their fit with an organization’s current environment. Your start-up’s current stage, let’s say a Series B with fifty employees, is probably not even remotely close to that of your aspirant “role model” organizations that are post-IPO with tens of thousands of employees. It’s like a Marshall Goldsmith lesson in reverse: rather than “what got you here won’t get you there,” it’s “what they’re doing there is not what you should be doing here.” Very much related, you have to consider your specific business model before assuming that a particular practice will generalize. There is perhaps no better example than the prevalence of Hoffman and Yeh’s Blitzscaling practices, even in businesses that fall clearly outside of the parameters outlined by the authors.
2. Take off your rose-tinted glasses.
We’re all prone to biases and logical fallacies. LBS professor Freek Vermuelen, who has researched why bad practices are adopted, argues there is an “everybody’s doing it”–type effect (much like FOMO) that makes popular practices seem better than they actually are. Just imagine: If you’re a tech startup and see the biggest firms doing something unique for their employees, you assume it must be important. And, goodness, you don’t want to be the fool that misses out. Other common problems involve survivorship bias, which is the tendency to focus only on the firms that make it big while forgetting those that went belly up, and the emergence of self-perpetuating myths that occur when a firm has the resources that allow it to succeed despite a practice rather than because of it (entertaining examples can be found this book). Consider Netflix’s very well-publicized termination practices (e.g., “The Keeper Test”) that supposedly drive a more transparent culture. While we appreciate the narrative, even a modicum of critical thinking would suggest that such a practice might not be ideal for a start-up without an already-realized killer product, a seemingly endless bankroll, and a plentiful pool of willing labor.
3. Find the evidence.
The phrase “best practice” once conveyed “evidence-based.” That connection has faded substantially in recent decades (for evidence, see the classic study by former Iowa professor Sara Rynes and her colleagues, as well as the troubling recent replication), likely because of so-called HR thought leaders pitching buzzword-laden solutions and, ironically, well-intentioned networks of HR professionals exchanging anecdotes about their firms’ practices. Of course, fun narratives and anecdotes hardly constitute rigorous evidence. Although academia can be criticized for being slow, it has nevertheless generated a massive body of literature on empirically supported practices that address all sorts of relevant organizational problems. These are available in numerous academic reviews and meta-analyses and, in many cases, have been distilled into nonacademic language by professional HR organizations (e.g., SHRM’s Science to Practice Series, SIOP’s White Papers). And the best part: even when specific practices evolve, the rationale underlying many work-related phenomena may not change dramatically. Want to know the design characteristics of enriching jobs? Want to design a valid structured interview? Want to create conditions for more empowered teams? All of this is readily available if you’re just willing to look. Point: If a particular practice isn’t jiving with extant knowledge, run!
4. Know your needs (and say “no” to practices that don’t address them).
Mark Nyman, a consultant at the RBL group, argues that “strategically run companies are as clear about what they say no to, as they are about what options they pursue.” Great HR leaders first understand how the business creates value then ruthlessly prioritize the practices that are clearly tied to the organization’s value proposition. They do not get caught up chasing superfluous “nice-to-haves,” and, further, they understand there are almost always significant indirect costs that come with a new practice, including the extra burden placed on managers. Indeed, the indirect cost of new programs, which are rarely highlighted by vendors hocking the latest fad, are especially acute in start-ups that have many first-time people managers and only lightly built-out support systems. All this said, just because effective HR leaders are comfortable saying “no” doesn’t mean they aren’t listening. To the contrary, they actively work to uncover the root of problems (i.e., the “why”) before considering specific practices (i.e., the “what”). As an example, your achievement-oriented employees may strongly advocate for formalized career ladders if they don’t quickly earn promotions, but what they are really asking for is feedback on how they can make progress toward career goals. So rather than developing expensive career maps that will be obsolete after the next funding round, a less costly and more efficacious alternative is to coach managers on how to implement rich one-on-one regimens with direct reports (for another common example, we recommend Angela Wilson’s excellent write-up on the overuse of training programs). As a final word on the virtues of saying “no,” experts argue that unwinding or taking away a program that ends up not driving value (e.g., free lunches!) can create a backlash that exceeds any upside the program ever had!
In closing, start-up people leaders are in an overwhelming position, and we understand the temptation that so many trendy practices elicit. That said, beware the bright shiny objects and alleged silver bullets masquerading as best practices. While you rarely need to reinvent the wheel, there is no substitute for critical thinking and a little homework when it comes to deciding which practices make sense for your organization.
T. Brad Harris is an associate professor of management at the Neeley School of Business at Texas Christian University and has a joint appointment with the School of Labor and Employment Relations at the University of Illinois at Urbana-Champaign. Andrew Bartlow is the founder of Series B Consulting, which advises organizations on talent and people management during periods of rapid growth and change. They are the coauthors of Scaling for Success: People Priorities for High-Growth Organization.