Author: NY Weekly Staff

Scaling at hyper-growth is always a challenge.  For those not familiar with the term “hyper-growth,” it refers to organizations that plan to at least double in size over a 12 month period.  In my experience scaling these types of companies (currently on my 4th), there are a few commonalities that most organizations face during high levels of expansion.  The key is identifying and mitigating these inhibiting factors as quickly as possible.  Failing to do so can hold disastrous results not only for talent acquisition, but for company goals as well.   Growth is inextricably linked to company initiatives, so it is imperative to identify these potential challenges as quickly as possible.

Below are the five most common challenges that high growth startups encounter when they scale.  It’s important to note that not every company will face all of these issues, nor will they hold the same degree of difficulty in attracting talent.  Notwithstanding, these remain the most commonly observed obstacles to overcome when achieving rapid growth. 

Establishing a Recruiting Ecosystem

The recruiting ecosystem is a vital component of all successful hyper-growth startup companies.  Organizations must invest the appropriate amount of time and resources into scaling.  Spend too much and you risk relegating recruiting to nothing more than a cost center.  Spend too little and you see few results or over-work your team.  It is important to strike a balance between investing in talent acquisition and spending money for the sake of throwing dollars at a problem.

The first step is to create a talent acquisition plan.  This plan should be inclusive of a sourcing strategy, internal tools like an applicant tracking system, candidate sourcing and engagement tools, and new employee onboarding processes. It is incumbent upon talent acquisition leaders to provide executives with a detailed proposal to fulfill all of these areas, at a minimum.  In the same manner, executives at hyper-growth startups should work hand-in-hand with their leaders in talent acquisition to ensure they understand the strategy and fund all of the necessary components.  Far too often talent acquisition professionals observe the extremes; simply purchasing a singular recruiting tool and applicant tracking system or acquiring every product they are pitched by external Account Executives.  Business leaders should trust their talent leaders to develop a strategy to support the needs of the business and fund the necessary tools to accomplish their tasks.  

Defining Efficient Interview Processes

Aside from the recruiting ecosystem, interview processes are arguably the most critical component to scaling an organization.  No matter how many candidates are introduced into the process, an organization will not thrive (or scale) if they cannot articulate the value proposition to the candidate, keep the candidate engaged in the process, and move expeditiously from application to decision.  There’s a saying in sales that, “time kills all deals.”  This is also true of the interview process within an organization.  Far too often organizations subject candidates to multi-step processes that drag out over several weeks or months. This simply will not work in the current environment.  Candidates have far too many options to remain in interview processes that include 4+ steps over the course of 30 days or more.  Organizations also should not expect candidates to complete lengthy assessments that are more than two hours.  It’s fairly easy to identify if these are bottlenecks in your organization because large groups of candidates will either self-select out or accept offers while still in process.  Some common objections to this notion are, “We’ve always done it this way,” or “this is how Amazon hires,” or “we need this process to know we are making the right hire.”  All of these, of course, are smokescreens to the real concern which is decision paralysis.  The current processes may have worked as a small company when the organization was hiring a dozen or less employees but they often do not scale.  More likely than not, your organization does not have a trillion dollar market cap with an endless supply of talent and thus is not Amazon.  And of course, no amount of steps will eliminate all candidates who do not fit.  Managers can hardly evaluate someone better in 10 hours than they can in 5 hours.  

Employer Branding

According to a recent LinkedIn survey, 75% of candidates will consider a prospective employer’s web presence and branding before making a decision.  Additionally, Nielsen observes that 92% of candidates check peer-reviewed websites such as Glassdoor before making the decision to change jobs.  This study is consistent with other surveys conducted by Glassdoor, which state that 86% of jobseekers review company ratings before interviews.  The bottom line?  If your company has poor Glassdoor ratings, or worse, no ratings at all, it will hinder growth efforts.  

Improving employer branding is one of the areas employers can immediately change and with minimal cost or effort to establish a baseline media presence.  Start simple by asking all candidates, regardless of whether or not they are hired, to complete a candidate survey.  Ask them to review you on Glassdoor.  Encourage your employees to leave honest, anonymous reviews.  Do not attempt to address these reviews, positive or negative, within your organization.  Instead, use it as feedback to improve your processes and listen to internal and external stakeholders.

Work Environment

Much like peer reviews, prospective employees care deeply about the work environment.  This not only references the dynamics at play, such as corporate values and interactions, but where people work. Is your company allowing people to work fully remote or are employees expected to go to an office?  It’s clear that virtually all employees, upwards of 96%, prefer to work remotely, but what might not be understood is some people refuse to go back to an office.  If you are mandating that employees report to an office, you are automatically cutting your potential candidate pool in half.  A recent study from SHRM suggests that 48% of employees plan to look for remote roles once they are forced to return to the office.  This is hardly the only study to suggest this trend, though it is one of the most recent.  There are other benefits to allowing remote work as well. There is extensive research to suggest remote employees are more productive, have better work/life balance, and have a lower attrition rate.  Additionally, remote work limits exposure to viruses such as influenza and COVID.

Compensation & Benefits

Compensation is not the most important aspect of a career move, but it is an important aspect of a career move.  It’s exceedingly rare for candidates to change positions when they do not observe an increase in base compensation, bonuses (which most companies provide), and comprehensive benefits.  There are certain benefits like unlimited PTO, paid Medical/Dental/Vision for employees, 401K with match, Parental Leave, Short-term & Long-term Disability, and Education benefits which typically move the needle.  Of course, not every employer offers all of these benefits, however it is important to remain as competitive as possible.  

It’s important to remember that all of these challenges (and more) are extremely common in high-growth environments.  Companies experiencing an uptick in hiring must necessarily review many standard practices and processes such as the ones listed above.  It is important to understand that, much like the size of the employee base, other aspects of the business will need to expand as well.  Typically this means increasing benefits, conducting internal and external market analysis of compensation, adding new tools for branding, or in some cases like Talent Acquisition, adding new departments.  All of these items are part and parcel with growth.  It’s not easy, but with the right approach and willingness to change, the experience can be extremely successful and rewarding. 

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