Effective Staffing Strategies for Technology Startups

September 23, 2015

9:00 pm

Hiring the right people for the job is critical if a technology startup is going to make it through the beginning phase and survive for the long-term. But staffing a startup is a complicated art. It requires using the right interviewing techniques to spot the right employee. To ensure long-term success, startups also need to choose the right classification for those that they hire.

Many startups are increasing their rate of successful hires by using competency-based behavioral interviewing techniques. These techniques let them more efficiently and accurately pinpoint the right employee who will contribute to the team’s success. Here is a look at how this approach can benefit a startup.

A Bad Fit, Disaster for a Startup

Startups don’t have the time, work force or money to deal with employees that don’t suit the jobs and the culture of their company. Bad matches slow down the workflow and increase the pressure in an already stress-filled startup phase.

According to a previous report, more than 18% of all businesses that dealt with an employee who didn’t fit in ended up with damaged relationships with their customers. That’s bad news at a time when every single client is critical.

Competency-Based Behavioral Techniques

Many consulting firms recommend that firms conduct their hiring interviews by using behavioral interviewing techniques. The idea behind this approach is that interviewers can find the best match by looking at the how and the why that drives a prospective employee. By wording a job description according to the traits that are required and by tailoring interview questions, interviewers can gain critical insights into an applicant’s previous and present behavioral tendencies in various situations.

The requirements for each job, often called competencies, describe the behavior of an ideal employee for each particular job function. Four of the most sought-after competencies for tech startups are:

  • Problem solving
  • Analytical skills
  • Customer orientation
  • Team player

To attract candidate who exhibit traits, a job description should feature terms like committed, flexible, articulate and focused. In the interview, ask questions that draw out how these terms reflect the behavior of the applicant. That type of data isn’t contained in a resume. Instead, it comes out as an interviewer speaks with candidates in person.

The Google Method

One company that uses behavioral and competency-based interviewing techniques with great effectiveness is Google. An excerpt from the book Work Rules!, printed in Wired, describes the structured interview process that helps the internet giant reliably find suitable employees. The author is Laszlo Bock, Senior Vice President of People Operations at the company.

In a structured interview, a consistent series of questions is asked of every job candidate. This interview can use either a behavioral or situational approach. With a behavioral model, the interviewer asks about prior accomplishments, suitable for the needs of the job. Hypothetical conditions are used in the situational method, asking the applicant what he/she would do in a specific set of circumstances.

Contractors or Employees?

In addition to an effective interview process, startups need to decide whether they will hire contractors or employees. As TechRepublic notes in a recent article, choosing wisely will keep you in compliance with government regulations.

The government has specific guidelines for differentiating independent contractors versus company employees, but companies tend to see the differences in simpler terms:

  • Employees use a Form W-2 for taxes, while a contractor uses Form 1099.
  • A payroll department takes out taxes on employee’s salaries, but contractors receive the full paycheck and are thus responsible for 100% of their own taxes.
  • Employees receive benefits, contractors don’t.

Be sure to use the government’s criteria when deciding how to classify employees. The wrong decision can result in a major fine or even a lawsuit.

To hire workers who will contribute to a company’s success in the crucial early startup period, take the time to interview effectively. Then be sure to correctly classify the people who are to be hired in order to avoid future problems with the government.

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Andrew Armstrong is a technology enthusiast, business owner, and digital marketing strategist based in the San Francisco Bay Area. A graduate of UC Berkeley in 2003, Andrew enjoys Cal Football games, experimenting with new technology, and chasing around his toddler son with his wife.