Bringing the Human Capital Challenge in the Spotlight

A relatively recent discourse is spreading across startup ecosystems from Nairobi, to Bangalore and Jakarta: While for a very long time capital was named as number one challenge startups are facing across emerging markets, the conversation is changing as enterprises are increasingly feeling the pressure of finding the right talent that is needed to scale their business. Especially as enterprises grow, with execution spread on many shoulders and teams working in different geographies, questions around high performing talent and teams start to matter. However, finding a strategic and consistent approach to addressing these questions is a challenge for many founding teams: While solving the pressing execution issues of today or chasing investors and capital providers, tomorrow’s organizational needs often become out of sight.

While the startup ecosystem is slowly responding to address this challenge, the gap is still wide and affordable, high quality services that address enterprise needs regarding teams and talent are still limited. Organizations like Shortlist, providing recruitment support in Kenya and India; Edge,helping startups in Kenya with tailored advise to increase team performance; and Amani Institute, offering a 6 months program for founders and their teams to work on scaling challenges that lie within their organization, stand out as pioneers.

To push the ecosystem and drive this agenda further, Intellecap’s Sankalp Forum aims to bring the question around talent & teams in the spotlight, moving from talk to action, and inspiring more stakeholders to join the conversation. This article is the first of a series of three articles building up to the Sankalp Africa Summit in February 2017 in Nairobi, where we facilitate a series of conversations around this agenda.

The first article calls out three insights gathered during a workshop recently hosted by the Aspen Network of Development Entrepreneurs (ANDE) at Sankalp South East Asia. The three take-aways show that it is time to move the agenda around talent beyond a conversation on recruitment. While finding the right people is undeniably a major scaling challenge for startups , there are a vast number of issues related to team and talent that need attention. In this article, we want to highlight some of the top challenges identified by more than 50 CEOs and founding teams:

Scaling the vision

Startups and growing enterprises, especially those driven by a social mission often have founders with a strong vision — and similarly strong passion. Translating this vision and passion to the rest of the team can be a difficult task. This is extra-hard for enterprises that replicate their models across geographies. As we at Intellecap scale our operations from India to East Africa, South East Asia and the United States, we often experience the ‘balancing act’ related to building “one vision”, while enabling participation in shaping the vision by new team members. Creating ownership of a shared vision among all team members across geographies is therefore among the top challenges, identified by the founding teams we spoke to.

Scaling the team

While finding the talent that is needed to scale an organization is a much discussed issue, the larger task at hand is to scale the team. What this means is essentially building “the glue between individuals”: Having more and better individuals in the organization is only part of the answer to strong performance — what is similarly important is what “happens in between”. Communication, roles, and mechanisms to learn, reflect and innovate as a team are not a matter of individuals alone. What may sound like common sense, is unfortunately not reflected when we look at functional departments of many startups. The task of building, nurturing and scaling teams is unfortunately not within the traditional scope of a “Human Resources” department — many times leaving the job undone.

Scaling the culture

“Organizational culture” often sounds fuzzy to startup founders and their investors, and hence often is expected to just be a precondition, rather than something that needs to be cultivated. Similarly, organizational culture is often confused with organizational structure. As a result, many times a documented “org chart” seems to be the common response to dealing with questions around communication and roles. Little attention is given on how team members and teams want to communicate with each other, how to support a problem solving attitude among team members, or how to deal with conflict and friction. Not surprising, founders are facing a lot of challenges on the path towards growth, where the organization is pivoting regularly, roles change frequently, and the founders have to take the team along in times of uncertainty.

Building the Talent Agenda

Initiatives like the recent ANDE-Argidius Foundation Talent Challenge are important to bring the conversation around talent in focus. However, what our discussion with startup founders shows is the need to broaden the agenda beyond issues of recruitment and hiring. Enterprises need a whole range of support to build strong performing teams. This article touched upon a few such questions. Related to those are questions around team incentives, rewards and performance measurement, questions around retention or mechanisms that boost creativity, innovation and learning.

As the startup ecosystem has found multiple ways to address the capital challenge, responding with different forms of investment readiness support, we hope to see a similar response to tackle questions around teams and talent. But for this to happen, we need to bring more attention to these issues. While the conversation around “organizational development” has left the niche with books like “Re-Inventing Organizations” by Frederic Laloux, offering a rich set of tools to startup founders around a lot of these questions, it is early days for this conversation to enter the startup mainstream. If you are interested in this conversation and to shape this agenda further, get in touch.

For more on this theme, see  http://intellecap.com/publications/understanding-human-resource-challenges-indian-social-enterprise-sector