A new article from BPM’s Business Lifecyle Center outlines six considerations to keep top of mind when constructing your initial leadership team in the startup phase of growth.
Your startup is off to the races and business is quickly accelerating. Now is the time to start building out your core leadership team. Those key individuals that will guide your organization as it grows, expands and evolves. This is a critical moment in your growth journey. You’ll need to attract strategic thinkers that share your vision for the future and are willing to roll up their sleeves and lend their skills across multiple functions.
6 tips for building your startup’s leadership team
Before you move forward with these decisions, it’s important to have a clear strategy on where you’d like to go next, as well as other nuances you may not have considered. To help you navigate this process – and achieve success in hiring and retaining these key members of your team – there are six key areas to keep top of mind:
1. Define your culture
Nothing matters more than defining the future vision for your company and the core values that will help you achieve that vision. Those principles should drive all major decisions. This is especially true when it comes to hiring your initial core leadership team, since that group will set the tone for everything else to come. The process of defining your culture should include formally documenting answers to questions such as:
- What’s our vision?
- What’s our mission?
- What are our core values?
- What is our compensation philosophy?
The sooner you define these foundational philosophies, the better. They will shape your hiring decisions and motivate your leaders and employees. They will also serve as a catalyst for top talent to stay with you for the long haul.
2. Hire strategic thinkers who are willing to multitask
During the startup phase of growth, it’s important to find leaders that have the right temperament and mindset that will help accelerate growth. Ideally, these first hires should be generalists who are willing to multitask and focus their efforts across many areas of the organization. This is especially important in the early stages of a company’s lifecycle because it’s unlikely that you’ll be able to hire specialists. Additionally, they need to be proven strategic thinkers that share your vision and genuinely want to be partners on your growth journey.
3. Identify the key roles you need
Determining what leadership roles to hire at the startup phase is dependent on the business and the industry. The CEO and operations functions should be in place first, in addition to a finance expert with financial planning and analysis (FP&A) experience. Eventually you’ll likely need a permanent CFO as well as leadership across the following areas: Sales, Business Development, Marketing, HR and Technology/IT.
4. Be strategic about titles
During the early days of your business, it’s critical to be thoughtful about the titles for your leadership team. Specifically, you should be cautious about giving out high-level titles right out of the gate. Down the line, you may need to hire more senior people and it will be difficult to backtrack those initial titles. In that scenario, you will have created potential inequities which can cause morale and retention issues. To get ahead of this, you should be prescriptive about title definitions, compensation, responsibilities and ownership from the beginning.
5. Lean on outsourcing
One strategy that helps avoid title inequities is to rely on outsourcing leadership roles temporarily. This is a common approach for startups. It allows you to get access to experienced professionals that can go deep into focus areas – providing critical guidance in the early days of your organization on a flexible basis. This tactic helps you get to the next level by filling important gaps across HR, IT, Finance and FP&A.
6. Have an open dialogue as the pace of growth quickens
Once on board, your leadership team will serve as the anchors of your organization. As such, you’ll want them to stay on board for as long as possible to promote stability. As needs and responsibilities shift with the rapid growth that will inevitability come, you must be clear on roles, ownership, responsibilities and expectations. This will help with retention rates at all levels. To achieve this, it’s important to have an open, honest and ongoing dialogue that’s sensitive to your leaders’ needs.
How BPM can help
Deciding how to structure and build your startup’s leadership team is one of the most critical decision points in a company’s history. Our HR Consulting services team can help you to navigate these and other related challenges – including employee engagement, HR policies and procedures, HR system implementation, compensation structure and bringing in the right expertise you need when you need it. Whether that’s on an outsourced or a full-time basis. Our team works in partnership with you to establish and evolve your organization’s people strategy and HR practices from the strictly tactical to the deeply strategic.
BPM’s Business Lifecycle
BPM’s Business Lifecyle Center has been developed to help guide our clients through any stage of the growth lifecycle. Our services focus on remaining organizationally proactive to help leadership avoid falling into a trap of stagnation. We invite you to explore our Business Lifecycle Center and see how we can support your organization’s evolution.