human resources challenges for startup organisations

Dream > Believe > PursueAICH

INDRANIL1

HUMAN RESOURCE CHALLENGES AND

OPPERTUNITIES FOR STARTUP

ORGANISATIONS

Friday, January 10, 2014 1

DREAM>BELIEVE>PURSUE

MODULES OF THE PRESENTATION

• Entrepreneurs – Definition , types, classification,t riggers and traits • Entrepreneurship – Human resource the key to succe ss • Key challenges and possible measures of mitigation • Startups - The initial human resource team crucibl e for growth an overview

– Team formation ,co founding ,advisors and retent ion• Recruitment - innovation,route to reach ,social med ia ,employee branding • Training and development in start ups .• Retention and attrition in start ups • Concluding remarks


ENTREPRENUERSHIP INVERNACULAR

Entreprenuership in Hindi उ योग

उप म (pr. \\udyog upakram\\)[Noun]



ENTREPRENUERSHIP

• Entrepreneurship is like raising children; it start s with amoment of enthusiasm, followed by decades of hardwork” -Howard Stevenson



ENTREPRENUER- DEFINED

Entrepreneur Webster’s - someone who runs a business his or her ownfinancial risk

An entrepreneur is a person who undertakes the crea tion of an enterprise orbusiness that has the chance of profit (or success) .

Some qualities of an entrepreneur

-Partnerships

-Robust network

-Realistic view

-Passion!

-Clear strategy

-Technology

-Ethical Behavior

-Flexibility



ENTREPRENEURSHIP –TRIGGERING EVENTS

Career ChangeDownsizingM&ARelocationSemiretired / retiredPassion for an IdeaEnvironmentDeregulation / regulationDisruptive Events



MY TRIGGERS

Atmano mokshartham jagad hitaya cha,"For one's own salvation, and for thewelfare of the world".

JOY OF GIVING !

DREAM>BELIEVE>PURSUE 10/14/2013 7


MY TRIGGERS

BYOB - BE YOUR OWN BOSS !

EMPLOYMENT GENERATION !

CHALLENGES -PERSONAL ,PROFESSIONAL ,SOCIETAL

TO BE REMEMBERED AS A FOUNDER OF AN INSTITUTION

ENTREPRENUER GENERATION

LEARNING LIFE, LIFE LONG LEARNING !

BECTEL MODEL -PUBLICATION ONTHE WAY!



ENTREPRENEURSHIP

Business is not a dirty word!



WHAT SOLUTIONS DO WE HAVE TODAY IN INDIA ?

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Government jobs - minimal ,reservations !

Private sector - Economy driven, Revenue driven ,R ecession driven

Academic profession - Water , water every where not a drop to drink!

Political will to create jobs - Policy paralysis!

Skill development- Negligible !

Only 9% of Chartered accountants passouts were pla ced this year!

ENTREPRENUERSHIP IS THEANSWER !



MY INFERENCES

• Know more be more !

• Knowledge is power !

• Net work!

• Go kiss the world !



CLASSIFICATION OF ENTREPRENEURS

Innovative Entrepreneur - He is the one who introduces anew product or a new method of production or opens a newmarket or explore new source of supply of raw material or carryout a new type oforganization.- STEVE JOBS

Initiative / Adoptive Entrepreneur - are those whoinitiate the successful entrepreneur in technique innovated byothers. - NIRMA

Drone Entrepreneur - are those who will never allow anychange in their production or style of functioning-.HINDUSTANMOTORS



CLASSIFICATION OF ENTREPRENEURS

FABIAN Entrepreneur - are always on caution. They neither introduce norchanges nor adopt new methods invented by others. They are lazy andfollow old customs, old method of production - Typew riter industry,pagers .

Another classification

1) Natural Entrepreneur

2) Motivated Entreprenuer

3) Created Entrepreneur

4) Forced Entrepreneur



ENTEPRENUERSHIPCHARACTERISTICS AND TRAITS

• Ability to deal with a series of tough issues

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Ability to create solutions and work to perfect the m

Can handle many tasks simultaneously

Resiliency in the face of set-backs

Willingness to work hard and not expect easy

solutions

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Possess well-developed problem solving skills

Ability to learn and acquire the necessary skills f or

the tasks at hand



ENTEPRENUERSHIP

CHARACTERISTICS AND TRAITS

Being an entrepreneur requires specific characteristioften achieved through education, hard work, and planning.

Risk TakerBusinesses face risk. Entrepreneurs minimize risk through research,planning, and skill development.

PerceptiveEntrepreneurs view problems as opportunities and challenges.

CuriousEntrepreneurs like to know how things work. They take the time andinitiative to pursue the unknown.



ENTEPRENUERSHIP CHARACTERISTICS

AND TRAITS

Self-confidentEntrepreneurs believe in themselves. Their self-confidence takes care ofany doubts they may have.

FlexibleEntrepreneurs must be flexible in order to adapt to changing trends,markets, technologies, rules, and economic environments.

IndependentAn entrepreneur’s desire for control and the ability to make decisionsoften makes it difficult for them to work in a controlled environment.

DEFERRED GRATIFICATION !




STARTUPS - HUMAN RESOURCES - THE UMBILICAL CORD

Key challenges and opportunities Core founding team - foundation, qualification as founders, building pillars , cofounding advisory help, Retention Recruitment - Innovation , Routes to reach, ROI of r ecruiters ,Employee branding , Use of social media.Training and development -Retention and attrition -



TEAM BULDING - A FOUR PRONGED PROCESS

• Building a strong foundation

• Creating the strong pillars to build the next floors

• Building the first model floor

• Then just replicating as long as you grow.


KEY FACTOR /CHALLENGE – FOUNDING

TEAM




INITIAL HUMAN RESOURCE - THE CRUCIBLE OF FORMATION

OF THE STARTUP ORGANISATION

Friday, January 10, 2014

Why a strong foundation?For maintaining an effective team you have to conce ntrate on foundations required for them. You must build or repair the fou ndation first if you are seeking to build an effective team. Stronger the foundation , higher the building will go. This stage needs lots of digging, too much patience and unbounded perseverance.

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INITIAL HUMAN RESOURCE - THE CRUCIBLE OF FORMATION OF

THE STARTUP ORGANISATION

Who qualifies to be a founder member?Identify the three core skills needed for your business and get them in the team as much as possible. The members should have shared goals and similar values. Don’t mix personal and professional relationships in your business because friends and relative don’t always make a good team.

Key traits to look for - from our experience Intellectual honesty Emotional energy Animal instinct - in the right sense of the w ord !




Who builds the pillar and the first floor?This is the next core team, may be next 5-6 key peo ple. This may include more functional experts (marketing, HR, technology, sale s etc depending on your business). Hire them for passion and skills. New bu sinesses are much about ownership, hardship and passion as much as about sk ills. Hire for attitude with shared goals and values, and train for business.






Who builds the floor?This is the growth stage where your business is wor king. You know what to sell, to whom you sell and where you want to go. Here skills are more important as you know what you are looking for. Pas sion, common goals and shared values are important too but to a lesser extent now

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THE STARTUP ORGANISATION - COFOUNDING OF THE TEAM


How do I find co-founders?The key to find a co-founder is networking: network , network and network some more. Make an effective impression: talk about your business with passion. Apply your checklist to all prospective co -founders: core skills, shared values and common goals. Come clean on every discussion point as you spend more time with your co-founders than y our better half.Be ready for divorce before marriage !EX COLLEAGUES CHAMPIONS WITH LOCATIONAL OBLIGATIONS RETIRED BUT NOT TIRED

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How do I deal with stock options?Ideally co-founders should own common stocks. It’s a good practice to have vesting for founders too, it keeps you accountable. The options should be decided based on your plans for next three years. Y ou will always need more senior people than your plan says. The core team sh ould be given healthy dose of options, nothing like ownership. 20% is alw ays a good number to keep as options pool. Give options but only once you hav e explained the value.

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How does Board of Advisors add value?It is an interesting approach to add skills to the team. Look for the key skills missing in the team; it could be networking, bounci ng of ideas, reality check or anything else. Do good reference checks and look for relevant advisors.

- Retired domain specialists - Freelancers - Professionals on sabbatical - Chartered accountants and company secretaries

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Some must do’s as you growYou must personally meet and interview every person you want to hire till your first floor is complete . Keep in mind that first set of team members join because of you not for the business.Communicate, communicate and communicate some more, it is never enough. Try to answer all the tough questions yourself. Behave like a foundation and support everyone. In reality, great people organizations are in inverted pyramid style.The inverted pyramid is a metaphor for a reversal of tr aditional management practices . Employees who are closest to clients or production processes are placed at the top and managers at the bottom. The employee is empowered with greater decision-making authority and freedom of action. The manager becomes a facilitator spearheading a team effort. In theory, overall organizational performance becomes faster, more adaptable and more effective.

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Some don’ts as you growNever ever strive to fake values, it just doesn’t w ork. Don’t try and hide behind system and processes. Early stage companies need mo re personal touch than process for people. Your core message can be same b ut words need not be for different teams.



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CHALLENGES AND PITFALLS OF START UP FOUNDING TEAMS

Getting Lost amongst the new talent acquired an d their capability Developing complacency Missing out on skill development due to high commitment to growth Deferred gratification - getting used to it! Big fish in a small pond to a big fish in a big pond transition !

Transform them to intrapreneurs !Give them opportunities to be a part of the i ndustry through representation on the in various forums Role swapping and swapping of profile .



STARTUP HUMAN RESOURCE RECRUITMENT – A PARADIGM SHI FT

STARTUPS NOW ARE IN THING IN CAMPUSES !

Flipkart.com hires171 IIT grads in day zero 2013 DECEMBER !

KEY FACTORS /CHALLENGE RECRUITMENT




STARTUP HUMAN RESOURCE RECRUITMENT- - STRATEGY

• Innovation in recruitment • Routes to reach the right resource • Employee branding • ROI of recruiters • Use of social media .



STARTUP HUMAN RESOURCE RECRUITMENT- - ROUTES TO

REACH THE TALENT


Employee referrals Most prevalent in MSME’s in India Internal job postings - Prevalent in slightly ol der startups Social networking on websites such as LinkedIn Job portals- domain specialistsCampus Recruitments- huge rush in India.Hiring through Placement ConsultantsHiring teams instead of an individualTargeting public-sector employees, ex-servicemenPartnering with educational and training institutesParticipation in Job fairsPre-placement offers (PPOs)

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STARTUP HUMAN RESOURCE RECRUITMENT- -INNOVATION IN

RECRUITMENT

BRINGING IN EXTERNAL CONSULTANTS FOR HIRING PHYSICALLY CHALLENGED SKILLED PEOPLE .EX SERVICEMEN IN ENGINEERING AND ADMINISTRATION.INCLUSION OF EXTERNAL HR MANAGERS IN INTERVIEWS .

More stress on - innovativeness - conceptual understanding - more stress on mobility ,outlook and innovative o utlook

towards work - matching of the core skills - multiskilling and multi disciplinary skills (en gineering

plus management )

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STARTUP HUMAN RESOURCE RECRUITMENT- EMPLOYEE

BRANDING

The entrepreneur is normally the brand who peo ple look up to and join instead of the company Employees working in the start up can be good r eferrals Employees from campuses could be used to revis it the campus once again to talk about the company .Star performers can be showcased for culture and other growth stories of the organization .EVP - Employee value proposition and return on investment demarcated is clearly worked out .



STARTUP HUMAN RESOURCE RECRUITMENT- ROI OF

RECRUITERS

A very important indicator of the validity of the recruitment made .In Msme’s the is directly proportional to the turn over since backend and support services are important . A Ratio of 1:10 - compensation to gross revenue generated -normally MSME’S turnover is low . For manufact uring sector 1 : 20 ratio .Service sector – 1:5 ratio and manufacturing 1:10 ratio minimum benchmark .



STARTUP HUMAN RESOURCE RECRUITMENT- USE OF SOCIAL

MEDIA

6.1 billion people have access to Facebook .Twitter ,linkedin and other social media .Below 25 years of age social media is a powerful tool to associate

.Every startup should have a webpage and a page in Facebook.Need to have a presence in social media .


KEY FACTORS /CHALLENGE –TRAINING

AND DEVELOPMENT




STARTUP HUMAN RESOURCE - TRAINING AND DEVELOPMENT

Training and development not a need a necess ity .Structured training ,unstructured training and on the job training. Career development programs – From day one Using government help in training and develo pment .Training and development as a retention tool f or startups .



STARTUP HUMAN RESOURCE TRAINING AND DEVELOPMENT -

A NECESSITY

In startups there are huge skill gap including the entrepreneur.Skills gaps in domain and non domain areasSoft skills a huge area of improvement Gaps affect the turnover of the company sin ce team is small.In house training by entrepreneur and his core team Ten man days per six months time would be an i deal investment in training Measurement of effectiveness to be measured on work and effectiveness on training .




TRAINING PROGRAMMES

Structured training programmes are costly needs to be used alike aftershave . A proper identification process of training needs identification is required .Unstructured training programs - impromptu trainin g most commonly practiced in MSME ‘sOn job training programme – most effective in MS ME sector but needs to be measured and mentored .




CAREER DEVELOPMENT PROGRAMS

Human resources career development plan – MBTI T ests ,EQ Test Brain mapping , 360 Feedback uncommon but needed .Career development plan at least for next thr ee years a broad outlook of career path . Expectation to achievement measurement




GOVERNMENT HELP

ITI SUPPORT PROGRAMME BOARD OF PRACTICAL TRAINING PROGRAM CII INDUSTRY ACEDEMIA PARTNERSHIP INITIATIVES – S KILL GURUKULESI HOLIDAY FOR EMPLOYERS FOR THREE YEARS PAN IIT INITIATIVES




A RETENTION TOOL

Startups a great place for learning Flipkart punchline - PPT – Come build the company !Multi skilling an advantage to employees of start ups – a natural offering of MSME’s High rate of learning in a short span of ti me !High rate of growth with the growth of the organization !


KEY FACTORS /CHALLENGE-RETENTION

AND ATTRITION




STARTUP HUMAN RESOURCE - RETENTION AND ATTRITION

Average attrition rate in startups in India 8 –47 percent!- TMI GROUP Survey in December 2013 Major causes - Lack of employment branding !

- Lack of career development - Succession planning of employees!- Lack of personal touch !


STARTUP HUMAN RESOURCE - RETENTION AND ATTRITION-

EMPLOYMENT BRANDING

Startups organization branding Startups employee branding


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STARTUP HUMAN RESOURCE - RETENTION AND ATTRITION –

LACK OF CAREER DEVELOPMENT

Launch of career development programmesMBTI ,360 degree , Leadership strengths assessmen t Peer feedback Career development programmes for each employee from day one atleast three year growth plan .




STARTUP HUMAN RESOURCE - RETENTION AND ATTRITION-

SUCCESSION PLANNING

Job rotation a very important aspect to der isk the business If you want peace be ready for war Three tier fall back plan in case of attrition Ex employees club/informal get togethers’ a grea t help!


STARTUP HUMAN RESOURCE - RETENTION AND ATTRITION –

PERSONAL TOUCH



STARTUP HUMAN RESOURCE - RETENTION AND ATTRITION - PERSONAL TOUCH

DREAM>BELIEVE>PURSUE 2


Oskar Schindler: I could have got more out. I could have got more. I don't know. If I'd just... I could have got more.Itzhak Stern: Oskar, there are eleven hundred people who are aliv e because of you. Look at them.Oskar Schindler: If I'd made more money... I threw away so much mone y. You have no idea. If I'd just...Itzhak Stern: There will be generations because of what you did .

Oskar Schindler: I didn't do enough!Itzhak Stern: You did so much.[Schindler looks at his car ]

Oskar Schindler: This car. Goeth would have bought this car. Why did I keep the car? Ten people right there. Ten people. Ten more people .[removing Nazi pin from lapel]Oskar Schindler: This pin. Two people. This is gold. Two more people . He would have given me two for it, at least one. One more person. A person, Stern. For this.[sobbing]Oskar Schindler: I could have gotten one more person... and I didn't ! And I... I didn't!

Dialogues from Schindler’s list – Schindler dialogue before going into hiding at the falls of Nazi’s

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CONCLUDING REMARKS

Spent 25 % of your time on people Accountability and delegation of power to core team Change should be the only thing constant Strong fall back and emergency manpower plan w ith strong vigil Training and development Personal touch .



DREAMS CAN NEVER BECOME A REALITY WITHOUT HARD

WORK.





AICH APPRAISERSAUCTIONERS AND VALUERSWe value every thing under the sun

EMPANELMENTS

WE VALUE EVERYTHING UNDER THE SUN 10/14/2013 46

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•EMPANELMENTS

WE VALUE EVERYTHING UNDER THE SUN 47

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•200% Year on year Growthbothbottomline and topline

•Strong credit rating

•Qualtrics Rated top 3 in India in ValuationServices

•Finalist forAIMA -Dr J.S Juneja Award forInnovation and creativity for MSME

enterprises for 2012 -2013 and ICICI -CNBC India Emerging India Awards 2013

LUE EVERYTHING UNDER THE SUN 10/14/2013 48

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• KATAICH INFRACORE ENGINEERING PVT. LTD.•Started with Changling construction machinery distribution and Nawa

crushers•Year on year growth 200%

•Revenue of ½ million USD in 2011-2012•Shantui heavy machinery dealership

•Spare parts supplier company•Started as the flagship company and diversified


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AICH MINING RESOURCES PVT. LTD.Opencast & Underground Mining of ferrous & non ferrous metal & non

metal mines concept to commisioning projects

•Opencast & Underground Equipment Selection, installation

•Concept to commissioning Technical Consulting & Mining Consulting

•Coal Washers Consulting

•CHF Concept to Concept to commissioning projects


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A BREIF PROFILE OF INDRANILAICH F ABOUT INDRANIL AICH

Chequered career of 18+ years in the industry out of which 14 yearsin multinationals of repute

Worked in Titagarh Wagons Ltd GoIndustry - Dovebid (FormerlyHenry Butcher) ,UT Limited (JV between Usha Group a nd

Telehoist of U.K.) Ingersoll Rand India Ltd,TIL (Tr actors IndiaLimited) -Jayashree Textiles, Indian Rayon Group -R ishra.

Award winning Production engineer with MBA from II FT kolkata .

Publications and teaching assignments in severa l institutions ofrepute .


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A BRIEF ABOUT INDRANIL AICH

PROFESSIONAL MEMBERSHIPSInternational Memberships

Honorary Life member of Royal Institute of Chartere d Surveyors (RICS),London.

Life member American Society of Mechnical Engineer s USALife member of the Mining ,geological and metall urgical Society of India .Life Member of Operational Society of India, Qualit y Circle Forum of India,

Systems Dynamics Society of IndiaLife Member of Institution of Engineers (Membership No.M-132302-9) and

Chartered Engineer from Institution of Engineers (A M 092132-5).Approved valuer (Registration No.18328) Category - P roduction & Industrial

Engineering and Fellow and Life Member of Instituti on of Valuers.Member of Indian Council of Arbitration, New Delhi an organization of FICCI

and Ministry of Commerce.Member of Practicing Value rs Association of India


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A BRIEF ABOUT INDRANIL AICHINDUSTRY CHAMBER MEMBERSHIPSMember of Confederation of India Industry Eastern R egionMember of MSME National council CIIMember of West bengal state councilMember of the economic affairs ,taxation and fina nce subcommitteeMember of the Safety subcommitteeMember of the MSME subcommittee


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• AICH APPRAISERSAUCTIONERS AND VALUERSWe value every thing under the sun

• Partnership firm Started in August 2009•Valuation Services for Movable And Immovable Assets Constructionand Mining ,Medical Equipments for asset based le nders banks andfinancial institutions•Consulting Partnership With American Appraisals Pvt . Ltd.•Over 6000 assets valued in three years with a val ue of around3000crores INR•MEMBER COMPANY OF CII ,BNCCI AIMA &IGCC


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EMPANELMENTS


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•EMPANELMENTS

WE VALUE EVERYTHING UNDER THE SUN 47

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•200% Year on year Growthbothbottomline and topline

•Strong credit rating

•Qualtrics Rated top 3 in India in ValuationServices

•Finalist forAIMA -Dr J.S Juneja Award forInnovation and creativity for MSME

enterprises for 2012 -2013 and ICICI -CNBC India Emerging India Awards 2013

LUE EVERYTHING UNDER THE SUN 10/14/2013 48

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• KATAICH INFRACORE ENGINEERING PVT. LTD.•Started with Changling construction machinery distribution and Nawa

crushers•Year on year growth 200%

•Revenue of ½ million USD in 2011-2012•Shantui heavy machinery dealership

•Spare parts supplier company•Started as the flagship company and diversified


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A BREIF PROFILE OF INDRANILAICH F ABOUT INDRANIL AICH

Chequered career of 18+ years in the industry out of which 14 yearsin multinationals of repute

Worked in Titagarh Wagons Ltd GoIndustry - Dovebid (FormerlyHenry Butcher) ,UT Limited (JV between Usha Group a nd

Telehoist of U.K.) Ingersoll Rand India Ltd,TIL (Tr actors IndiaLimited) -Jayashree Textiles, Indian Rayon Group -R ishra.

Award winning Production engineer with MBA from II FT kolkata .

Publications and teaching assignments in severa l institutions ofrepute .


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PROFESSIONAL MEMBERSHIPSInternational Memberships

Honorary Life member of Royal Institute of Chartere d Surveyors (RICS),London.

Life member American Society of Mechnical Engineer s USALife member of the Mining ,geological and metall urgical Society of India .Life Member of Operational Society of India, Qualit y Circle Forum of India,

Systems Dynamics Society of IndiaLife Member of Institution of Engineers (Membership No.M-132302-9) and

Chartered Engineer from Institution of Engineers (A M 092132-5).Approved valuer (Registration No.18328) Category - P roduction & Industrial

Engineering and Fellow and Life Member of Instituti on of Valuers.Member of Indian Council of Arbitration, New Delhi an organization of FICCI

and Ministry of Commerce.Member of Practicing Value rs Association of India


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A BRIEF ABOUT INDRANIL AICHINDUSTRY CHAMBER MEMBERSHIPSMember of Confederation of India Industry Eastern R egionMember of MSME National council CIIMember of West bengal state councilMember of the economic affairs ,taxation and fina nce subcommitteeMember of the Safety subcommitteeMember of the MSME subcommittee


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You can reach me @

[email protected]@outlook.comMobile +919831088204/+919038088204



QUESTIONS AND ANSWERS SESSION

10/14/2013DREAM>BELIEVE>PURSUE 2
