The People function is often viewed as transactional and administrative as opposed to transformational and additive. Viewing the function as such has led companies to strive to minimize its cost instead of maximizing its impact.
This underinvestment in the People function translates into under-resourced teams, leading to slower hiring and lower productivity. These poor outcomes make it difficult to justify bigger budgets, and the vicious cycle continues.
2. Misaligned expectations.
People teams are often victims of misaligned expectations and lofty goals. In a recent article, Chief People Officer of Couchbase, Jessica Yuen, wrote, "The expectation for a CPO needs to be reframed to focus on what’s realistic for one person to achieve within the context of the team and budget. If not, the People leader ends up busy with tactical issues, and strategy is deprioritized. The consequence? The CEO isn’t getting the value from their senior leader, and the senior leader is dissatisfied because they anticipated a strategic role."
This misalignment at the top trickles down to the team. Combined with budget constraints, it makes for a tough environment to succeed in.
3. Uninviting career path.
The factors discussed so far have led to a more systemic problem: talent scarcity.
In Europe and even in some U.S. hubs, startups have a hard time hiring great people into their People teams. There simply aren't enough exceptional recruiters, HR specialists, and People leaders with startup DNA and scale-up experience.
This is not an easy problem to solve. The scarcity is partly due to the negative perception of HR and low salaries, which are deterrents for high caliber talent. Moreover, low barrier to entry into the field, inflated titles, and ambiguous roles have created a gap between perceived skills and actual ability.
In other words, when we bestow a 'Head of People' title on a recent grad with two years of experience as an office manager, we devalue the expertise required to earn a 'Head of' role and widen the compensation band. This is bad for everyone, especially for the people pursuing a career in this field.
These challenges will not go away overnight. But as a starting point, it is worth considering the vital role your People function can play in building an exceptional team of highly motivated, engaged employees. With that new perspective, we can begin to raise the bar and compensation levels to make the roles more attractive to a wider talent pool.