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How to Start and Grow Your HR Department

In Human Resources — by John Dietrich

plants in office

So you’ve decided it’s time to build a human resources department. What do you do first?

Strategize. Be clear about the HR department responsibilities from the get-go. Human resources can be a powerful tool for furthering the culture of your business, which is invaluable for a growing small company or startup. Gather all of your top leaders to make a plan for what human resources positions you want to bring on board and why.

What positions do I need?

If you’re looking to start your HR department, then you should first understand some of the most common roles. Knowing this basic information will help you to find the right people to add to your team and to set expectations about what services they will provide for your company and existing employees.

Director of Human Resources: This is the leader of the pack, the captain of the ship. The director is the immediate supervisor for any other human resources employees. They are responsible for crafting the company’s strategic HR functions and communicating those plans to upper management. They maintain any policies and government compliance related to employment. If needed, they also coordinate with other department heads to keep tabs on any personnel-related issues.

Human Resources Manager: This role is a direct report to the director, and focuses more on the operations side of human resources. Maintaining the HR department and ensuring a seamless operation is a main objective for the human resources manager.

Staffing Coordinator: A staffing coordinator is focused solely on the personnel side of human resources. Their regular tasks cover the recruitment side, with updating job descriptions and scheduling interviews. They’ll also focus on the retention side, with managing vacation requests, monitoring overtime, and assisting with payroll.

Development Officer: The development officer is responsible for training. This person will help with the creation of training programs for new and existing employees. They’ll also assess how well training goes and how to improve those efforts.

Human Resources Generalist: For a larger human resources department, the generalist is the entry-level role. This person will take care of administrative tasks, freeing up the managers or director to work on the more complex or sensitive issues.

The first hire

Now that you know who you could potentially bring on board, what’s the most important role to hire first? Ideally, you want your first human resources employee to be somebody who can quickly take all of the department’s responsibilities under their wing. That means you want the new addition to be a director or a manager. At those levels of expertise, your fledgling HR department will have a lot of grounding in the field and will be able to help steer your company on a steady course as you grow.

As you interview for the position, look for people with not just past experience, but also a philosophy that suits your business. What kind of company culture will they encourage? How will they interact with the other managers or directors on your team? What is their attitude about the role of human resources within a business? Make sure all those answers line up with your company’s needs before making an offer.

Also, be sure to support your newest team member once they’re on board. Give clear directions, set expectations, and answer questions. That will help make a smooth transition as you expand the team.

Hierarchy of an HR department

Your HR department structure can often be summarized with a chart. The director is at the top, overseeing everything that happens within the department. Below the director are branches for each of the main subjects that the human resources department will cover: staffing, training, compensation, benefits, retention, and compliance. Depending on how your team has grown, you may not have a separate person to handle each of those tasks. That’s not a problem, as long as all of the required duties are getting done.

Having a chart gives a formal structure to who reports to whom, and what your HR department responsibilities are on an individual level. Especially when you are at the early stages of building a human resources department, it’s essential to have everyone on the same page.

Cross-team collaboration

Fortunately, if the idea of hiring a person to fill each of those duties seems overwhelming, it most likely isn’t necessary. Your company may be at a stage where having separate individuals handle each part of human resources wouldn’t be efficient. That may mean that you have just one or two HR employees who divide the tasks. Or, if you have the right blend of skills among your employees, it’s also possible to have other departments pitch in and help with some of the HR department responsibilities. Here are some interdepartmental choices your team can make to help with human resources.

Marketing: Looping in the marketing team is great during the recruiting stages. Marketing pros know how to get the word out to a wide audience and how to target a very specific type of person. No matter what type of job you need to fill, the marketing crew can probably help your HR team reach those candidates.

Operations: Your operations team knows all about the people and processes that make your company a well-oiled machine. That means they’re in a good position to help with topics such as training and employee satisfaction.

Accounting: These are your money people. If you need extra HR support on payroll, budget, or other financial issues, then get accounting involved.

Legal: Most legal departments aren’t experts in the same topics that HR pros are, but they can help advise on topics related to compliance or disputes. And if you really need to make the most of a small number of people, having a really sharp individual overseeing any legal issues might be the way to go.

Information technology: Your IT experts can help implement any programs used to make HR tasks more efficient. Having somebody in-house who knows how to troubleshoot efficiently means that the HR team doesn’t need to be on the phone with tech support, freeing them up to focus on more important tasks.

This type of collaboration can even be useful for companies that have a fully staffed HR department. It forges tighter bonds between team members and helps departments better understand what’s happening across your organization.

Measuring success

As with any element of your business, you’ll want to regularly check in and assess how well your HR department is performing. Consider these key performance indicators to measure the effectiveness of your HR department.

Finances: There are several money-centric KPIs to use for your HR team. What are the costs of a new hire? What is the average salary at your company? How much does your HR department cost to maintain?

Time: What’s the average tenure of your employees? How many hours do they work each day and how effectively? How much vacation do they take? How many hours of training does a new hire receive?

Satisfaction: These metrics can be a little trickier to track, but they are equally important in analyzing your human resources team. How happy are your employees at their jobs? Are they pleased with their pay, their benefits? Do they feel confident in their roles? Even though HR employees are reporting to upper management, their job is to make sure that everybody at the business is satisfied with their work situation. Consider implementing an employee engagement tool to help measure satisfaction. Such software allows employees to fill out weekly anonymous surveys that take just a few minutes to complete. Anonymity helps make the team comfortable to express exactly how they feel, and you can get real-time, actionable feedback.  

A version of this post was first published on Search Party.

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