Article: 'HR leaders in SMEs can lead change with macro patience, micro speed'

A Brand Reachout InitiativeStrategic HR

'HR leaders in SMEs can lead change with macro patience, micro speed'

In a startup, talent density is the responsibility of leaders. They ensure quality is not compromised even in periods of fast growth, according to Kartik Rao, Chief People Officer, Good Glamm Group.
'HR leaders in SMEs can lead change with macro patience, micro speed'

It is no news that emerging businesses play a positive role in driving the job market and economy of India. The growing number of startups, SMEs, and unicorns and their success stories is a testament to their potential and contribution. 

To take this success to new heights, small businesses need more robust systems and nimble processes to drive better individual and business results. In the face of digital transformation and economic uncertainty, SMEs and startups have to rise to greater levels of performance. 

Are small businesses in India ready to take on this journey? What are their strengths? Where are the gaps? And what role can HR leaders play in helping businesses grow at an exponential pace?

In a recent interview with People Matters, Kartik Rao, Chief People Officer, Good Glamm Group, discussed these questions and shed light on the emerging role of HR for ever-evolving SMEs. 

How equipped are small businesses in creating a skilled economy? What are their strengths? Where are the gaps?

Today, small businesses are extremely well equipped to create a skilled economy. The digital tsunami has completely changed the way companies look at talent. Scale, not headcount, defines the size of a company. The dream is to have the soul of a startup with the scale of an MNC.

The biggest strength of small-scale businesses or startups is the opportunity to develop their mission from scratch. 

People are excited about playing a meaningful role in 0 to 1 journeys and growing with the brand. 

Everyone may not want to join a big company. Some want to be part of the journey of making the next successful brand. 

Startups are also building in more ownership through perks, such as an employee stock ownership plan (ESOP), which bring in a founder mindset and have more skin in the game for people to stay committed over long periods of time.

The number of startups and small businesses that have come up in the last 10 years will supersede the number every decade before that. 2021 alone saw 43 startups turning unicorns.

In terms of the gap, the biggest shift has been in the demand and supply of good talent, especially after COVID. 

The companies with money in the back and strong investors or deep pockets are able to offer packages or benefits which become unrealistic or impossible to match for small businesses or startups. 

These offers can include gifting international holidays, high-end automobiles, and expensive gadgets on top of cash and equity, which continue to make the skew bigger and wider.

Who owns the talent agenda in SMEs and startups?

It is no longer restricted to the CEO or the CHRO. 

In a startup, talent density is the collective ownership of the CEO, CHRO and Senior Member Team who act as 'bar raisers' to ensure quality is not compromised in a constant quest to over-index on speed.

As businesses pivot to digital ways of working and doing business, how is the role of HR in SMEs and startups changing?

Digital transformation is one of the most rewarding transitions for the economy and for companies. 

HR teams are also expected to be more tech-savvy and to move from hindsight to insight to foresight. 

Tools like organizational network analysis (ONA) are able to help HR and business identify network density that has a deep impact on culture, people retention and engagement.

Earlier, it was about people; now, it is about systems, processes and people. 

HR leaders create, pre-empt, prepare and deliver a lot of talent readiness for the company. You can't do that unless you understand the business and are looking into a three-year future with the CEO. 

Two skills will be critical for the next decade. People with high analytical skills and high people skills. Someone who is not high on analytical skill – but is a champion in people skill – will add disproportionate value to an organisation. HR will have to own this responsibility of making an organisation that is a digital pro and also people first.

What skills and support do HR leaders need to fuel organisational change, and to propel the growth of businesses and the workforce?

Having a learner mindset and being tech-savvy are non-negotiable skills: Any CHRO or HR leader who doesn't have exposure to technology will find it difficult to stay relevant in the next decade. HR's ability to hire, retain, engage and grow diverse talent with core competence in tech will be of high value to every CEO and business.

Macro patience and micro speed. Organisation-wide changes require persistence and hustle with macro patience. 

HR's ability to manage collective anxieties and change management will be applicable even after the pandemic is over. Hybrid culture, diversifying talent, HR automation and personalization will all have their place in organisational culture.

Design new performance scorecards and heroes. The best performers under normal circumstances were not necessarily the same champions during a crisis. 

Leadership in crisis had new heroes. Some brilliant people took time to change and adapt, and some not so great people showed tremendous agility. HR will have to equip itself and the organisation with an extremely agile performance management framework that can accommodate all the variables that come with digital disruption.

Support Needed

A digital pro and people-first business requires CEO and executive leadership buy-in.

Many times CEOs want evidence of culture rather than the culture itself. Building culture is hard, and sustaining it over time is even harder. HR can make policies, but it's the business leaders and people managers that make policy a practice. Why is there pressure on HR to be a business partner and not vice versa, where business needs to be an active HR partner?

How can SMEs and startups build on their intuitive and compact business models to compete with large enterprises and win the war for talent?

Through agility, innovation and resourcefulness, what large-scale enterprises achieve through systems and processes, small-scale businesses and startups achieve, too. 

In a startup, you are always a person less and a dollar less. That's what makes it exciting, and it's no coincidence that the biggest breakthrough startups came up with solutions that the biggest enterprise businesses couldn't.

Hyper-build on the digital lead that startups enjoy. Today, a cellphone is a theatre for content; provides a food menu, cab on demand, grocery on demand, or your favourite brands ready for delivery to your doorstep; and works as a knowledge or education platform and an office connection/collaboration platform. Behind these, startups through digital innovation transformed consumer behaviour forever. This DNA is not a skill that can be copy-pasted by just hiring folks from a startup. 

It requires a culture transformation, mindset revolution and an ability to explore, experiment and be willing to fail fast and get better. This is a disproportionate advantage that startups can continue to build on to make them large-enterprise-proof.

People today look for purpose, mission and meaningful roles to contribute. Startups and SMEs are able to offer a clean slate for these highly aspirational people to express themselves and work with minimal bureaucracy. 

Equity in the company, founder-like treatment and high autonomy and freedom are things that are not available within large-scale enterprises.

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Topics: Strategic HR, Talent Management, #SMEcorner

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