‘When your company is hiring less than 15 engineers a year, recruiters can be part-time or and grow organically with company referrals,’ writes investor and advisor Elad Gil in his book High Growth Handbook. But when you are growing fast, specialists come in.
As you scale, you’ll need sourcers, recruiters, candidate researchers, marketers and university programs to hire good talent. You’ll also need to work on executive hires and senior leaders. Freshworks grew to more than 3000 employees in the last few years and Suman Gopalan, the chief human resources officer at Freshworks, helped scale the people function at the company.
In the latest episode of The Orbit Shift Podcast, Gopalan talks about how we did it. She discusses how to scale your startup from thirty to three thousand people without losing sight of the company culture, or bursting at the seams. She also talks about when you bring in specialists, put in processes, management tips for first-time leaders, and more in this podcast.
Q. How did Freshworks ensure the wellness of its employees during the pandemic?
A. We realized during the lockdown that everybody was leading a sedentary life in front of the computer all day and that is not good for people’s health. If we wanted to beat this pandemic we had to be at our physical best. That’s why we focused early on physical health and we organized online fitness classes and yoga sessions. Over time it became more than just physical fitness because we needed mental resilience to get through the pandemic. Our focus shifted from physical wellness to mental wellness and we did a lot of work to help people adapt to the new normal.
Our value proposition as a company is anchored around this notion of employee happiness and creating an organization where employees are happy doing the work that they do. We’ve always encouraged people to speak up and for the most part, we have really relied on internal surveys that we do call vox pop for people to speak up and tell us about what they like and what they do not like.
Q. What are the aspects that contribute to the happiness of an employee?
A. Ultimately, it comes down to four big things. One is how do I feel about my organization? Am I proud? Do I understand the strategy? Do I have confidence in the strategy and senior leadership? Number two is how do I experience my company through my manager? Do I have a clear direction on what I should be doing and do I receive the support that I need to achieve my goals? Number three how do I feel about my work? Do I feel a sense of purpose? Do I understand how it contributes to the overall strategy of the company? Do I get excited by the work I do? And the fourth one is around my team, which is do I have a sense of belonging with the team that I work in? And do I enjoy working with the team that I work with? These are the four things that across all organizations are the biggest reasons for employee happiness.
Q. How are companies going to bounce back from the pandemic? Would they embrace remote work, a hybrid model, or get back to the office?
A. If there’s one thing we know for certain it’s that we won’t be back to the same old model. We have all moved on from there. Most organizations have moved on from that model of saying everybody comes to the office all five days of the week. Some companies will still choose to do that and they will have their reasons to do that. But for the most part, I see that organizations will offer a lot more flexibility in their approach and that’s what we’re thinking about at Freshworks as well.
There’s a lot of merit and value in working together in teams face to face. At Freshworks we will most likely take a hybrid approach, which would mean that there will be some roles and some people who will be always remote and there will be some roles and some people who will always be in the office. But for the most part, people will have the flexibility of working in the office and working from their remote locations when they choose to.
The other interesting trend that I see is flexibility in locations. Before the pandemic, most companies thought very deeply about their site strategy. Where should I have my big offices? Should it be in Manila, Barcelona, or Bangalore? But now I see that there is much more evolved thinking around how we can expand beyond just these large hubs.
Q. What does all this mean for managers, because most managers are used to a certain way of running their teams? Team building has mostly been a high-touch activity, remote changes all that. How do you see this evolve? And what are some of the tips that you can share with young managers?
A lot of times, when you think about managing the team, you really think about the face-to-face interactions that you have with them. You can recognize signs of frustration, fatigue, disengagement and you’re able to develop a rapport much faster when you see somebody face-to-face.
When we go remote as managers, we have to now find a way to bring our team together and build an identity for the team, when none of them are going to see each other. You also don’t get to see the team dynamics play out, you can’t give personal feedback, it’s tougher to identify which teams work well together, and so on.
Now you have to be a lot more thoughtful and deliberate as a manager. You need a management system that talks about what is your way of building rapport and connecting with each one of them on a one on one basis. How you do your check-ins and how you do your reviews, you need to have a cadence and a structure around how you manage the team. That’s with the individuals and then you have to think about the broader team and really think about what you are going to do to ensure that you evolve a single identity for this team, even though nobody’s seen each other or nobody’s going to meet each other face to face.
Managers also have to be a lot more thoughtful in how they manage and it’s going to require a little bit of training on how we ensure fairness, especially in a hybrid system where some of them are going to be in front of you and some of them are not going to be in front of you. How do you make sure that as a manager, you are being fair to everybody, and not just the folks that you sometimes get to develop a closer rapport with?
Q. How should a startup approach hiring?
A. Early on, you don’t need too much complexity in your operations. What you need is a laser-sharp focus on what you’re trying to build, or what you’re trying to accomplish, and not complicate the operations too much. What you’re trying to do is to scale to make sure that you’re hitting your first million, and growing from 1 million to 10 million, and therefore you need people who can do a broad range of things, you need people who are willing to experiment and take risks. But as you grow, your processes have to grow as well. And that’s when you need subject matter or domain experts. When you’re trying to scale your hiring function, for instance, you need somebody who can build that function out for you, and who will build a function that is more predictable, and manageable for which you need process, metrics, and domain expertise.
Q. When is the right time to bring in HR as a function and start building it?
A. Your first HR person is typically the startup founder because as a startup founder, you are the person who is responsible for hiring the first set of individuals and setting the work practices which then evolve into becoming a culture.
As you start to achieve scale, you need a lot more dedicated folks who can bring in the capacity for you to scale. That’s when you should think about HR as a function, essentially it starts with two key roles. Generally, you would start with somebody who’s a recruiter, because that’s really what you need. You need people and you need capacity for you to scale as you’re growing. The second one is you need somebody who’s more of a generalist who strengthens operations. This is the person who is going to ensure that you have basic people processes in place, whether it’s your onboarding, payroll, compliance or employee experience.
Q. What’s a good approach when you’re hiring for senior leadership roles? Do you want to bring them through your networks or executive search firms? And what are the qualities that a startup should look for in a senior leader?
A. When you’re in the initial stages of your startup, you typically use your network because you would generally find people who are genuinely interested in you, and people who are referring will always find you people that they think will fit into your culture.
For leadership in the early stages, I would always recommend that startups use the VC network if they are funded. Many of them have strong talent management divisions and they generally help find talented leaders who can come in and help scale.
For early to mid-stage startups there comes a time where you turbocharge your growth and you’re growing at a rapid pace. That’s really where you start to see that your need for leadership talent just grows astronomically. And that’s where it’s worth investing in a talent acquisition team that has a dedicated person for executive search, or you work with other search partners.
Generally, people think about what I need now, who is the leader I need now. But the lens that I would recommend putting on is: given the pace of growth that you’re seeing what is going to be your need from this role over the next two years. For example, if today, it’s a $50 million business, but in two years’ time, you really think it’s going to be $500 million, the leader you’re going to hire is going to be very different. Now you have two choices to make. You either hire somebody who is good for today’s size, has the potential to grow with the business, and can manage a team and the business of $500 million. Sometimes you take calculated risks and say, I’m going to overhire for this role and this person coming in is going to grow the role. The biggest thing that I’d say companies should look for is culture fit because, at that level, you take for granted their functional technical skills.
Q. How should first-time managers approach their first 100 days from a people perspective?
A. The first 100 days, you have to unlearn and be ready to learn. For all this while you have been the superstar individual contributor, and all of your success criteria has been directly in your control. Now, your performance is dependent on 5-10 other people, and it’s no longer about your individual capability. It is about how you can make these 5-10 individuals as good as you. The first 100 days any new manager should spend time getting to know the team and listening more than talking and really listening to how work gets done, what is the team identity, who are the team members, what is top of mind for them, how are they performing, get to know as much context about the team as possible. Soon, you have to be able to go back and communicate, what we’re going to accomplish as a team, what do we want to do, what are our goals going to be, what is your vision for the team going to be, and be able to bring them together or rally them around what you want to achieve.
Q. How can the Human Resources team and different people within the company play a role in the success of newly onboarded employees?
A. I think of this as two distinct phases, the first one is onboarding. You can think of it as an equivalent to your getting started phase where you buy a phone, it says you want to get started, do this, do that get set up.
The second phase is what I call assimilation. And that is where we have to spend the maximum amount of time to get anybody set up for success. Our HR team plays a very big role in ensuring people are off to a good start, that they understand the company, the culture, the business, the products, they have the necessary infrastructure and information to start contributing. But beyond that, the most important part of assimilating the employees into a company is the role that a manager plays. That means you’re helping them understand what are the expectations from their role, how work gets done, how we communicate in this organization, how we make decisions, how we work together as a team, how do we resolve or address conflict, how do we evaluate performance. So many things that form the context for them that is really assimilating new members into the team and helping them build productive relationships with other team members.
Q. When companies grow, you bring in fresh talent and you face this very interesting challenge, which is the old-timers versus new folks. As Elad Gil talks about in his book, this is a common problem. What are some of the things that a founder and a startup can do to make it easier on the company?
A. The most valuable old-timers are those folks who see this as an opportunity to learn versus feeling like the company is changing, or it’s not the same anymore. Sometimes we also make mistakes in bringing in new talent. Culturally, they may not fit into our context, and culture fit is the one that you really need to evaluate for. Sometimes what happens is we bring in people who are really skilled in their craft, but don’t culturally fit into our context. And therein lies the friction because you generally then don’t have the openness to learn from them as well. And the folks who come in new also tend to rub people the wrong way. The most important thing you can do as a leader is making sure that you are bringing in talent who are going to be respected, that they culturally align with your company, and therefore will gain other members’ respect as well.
Q. If our listeners want to reach out to you, what’s the best way to do that?
A. The best way is you can connect with me on LinkedIn.