Hey CEOs and Founders — This Is What You Should Expect from Your Head of HR

Hey CEOs: You want an executive. Not a traffic cop.

We’ve hired multiple heads of Human Resources in the last couple of years. Here’s what you should expect from your existing HR leader — and what you should be looking for if you’re hiring one for the first time.

Strong teams build strong businesses

When ParkerGale buys a founder-owned technology business, we start by digging deep into how the company works. The sales process. Marketing. Budgeting. The Product roadmap. Across all of these disciplines, the most important question we ask is: What’s missing?

The answer is often the same, no matter where you look. “Consistency.”

Consistent businesses, the ones that do things the right way, over and over, tend to have a strong organizational infrastructure: a set of repeatable, thoughtful processes and a clear, teachable collection of “how we do things” principles. To build this kind of infrastructure and consistency, you need a strong team: a group of people with high standards who work well together. Choose the right people to join your team, and your company’s infrastructure gets stronger. Choose (or tolerate) the wrong people, and your infrastructure weakens. It’s that simple.

For small technology companies focused on growth, preventing these team mistakes REALLY matters. Your process for deciding “who’s in and who’s out” needs to be rigorous, thoughtful, and aligned with how you plan to grow the business. Get it wrong once, and you’re stuck with someone who holds you back (-1) instead of pushes you forward (+1) — that’s a two-point swing. Get it wrong consistently, and your company will meaningfully underperform. Then you have a choice to make: do you blame your lack of growth on the market, the economy, the competition, or your customers’ changing tastes?

Nope. Sorry. Wrong answer. It‘s the team.

What to look for in a Head of HR

While everyone is partially responsible for minimizing these costly mistakes, you need someone to shoulder a little more of the burden. You need an owner. One person to coordinate and direct the work of building a strong team and a healthy organization. Someone with standards. Someone who knows how to hire, manage performance, and develop, recognize, and reward people. Someone who knows how to fit those standards to your business, teach them to others (without being obnoxious about it), make them stick, and improve them over time.

THAT‘S what you’re looking for. That’s your next head of HR.

Many other great management thinkers have their opinions on how to “do HR right.” A few of my favorites are Ben Horowitz’s Management Quality Assurance and Dave Kellogg’s Missive to Human Resources. Dave sums up what HR should be doing better than anyone else:

“Help managers manage.”

3 words. 6 syllables. And yet, so few people out there who can actually deliver.

After hiring several HR leaders in our portfolio in the last few years, we think we’ve uncovered several factors that the best have in common. Keep in mind, your mileage may vary. At ParkerGale, we invest in one thing. All of our portfolio companies are small (~100 employees or so), growth-oriented, headquartered-in-North-America B2B technology companies. Our “must have” list is geared towards businesses of that size and stage — no offense intended to the fantastic people leaders working in other spaces with different needs out there. (We see you and you’re doing great.)

Hiring your own HR leader? CLICK HERE TO DOWNLOAD A ONE-PAGE HEAD OF PEOPLE INTERVIEW GUIDE

What the best HR leaders do differently…

THEY’RE SMART AND THEY GET THINGS DONE. These people have high standards (and the means to detect if those standards are being met) for the more strategic component parts of HR: Hiring, performance management, learning & development, and communication. The best People Ops leaders can quickly assess “what’s red and what’s green” across a company’s human systems and formulate a plan to close the gaps. Then they deliver.

How to test for this: Ask them to tell you about “what good looks like” for one people-focused discipline — hiring, performance management, onboarding, etc. Then ask them what they might expect to find inside your company. Where are the likely gaps going to be? Finally, ask them what they would do to get started on making progress. Ask them to get specific on sequencing and timing for their hypothesized plan. How long will it take to make progress? Avoid anyone who has a hard time estimating how long things will take, listing the steps required, or formulating a hypothesis on what they’ll encounter.

THEY BUILD STRONG HIRING PRACTICES: Improving how you hire and upping the quality of your new employees is the first step to building what Lazslo Bock, former head of Google’s People Ops team, calls “a self-replicating talent machine.” The benefits of getting this right compounds: A players tend to hire A players, while B players get you more B players — and some C’s. Great HR leaders not only define and run a strong hiring process, they also get managers bought in on that process while building a diverse and inclusive workforce.

How to test for this: Ask about a time when they had to juggle multiple open requisitions. Then ask about how the processes differed between hiring managers. Great HR leaders are masters of “flexible standards”: Maintaining consistency in the most important parts of a process while recognizing that negotiation and partnership comes with any recruiting assignment. Too rigid? Too laissez-faire? Pay attention to what you hear and how they flex their process depending on who they work with. Also, don’t forget to ask about diversity, equity, and inclusion. Great hiring practices have DEI “built in”: Ask them how they minimize bias in sourcing, assessing, and closing the best candidates. Listen for specific steps in the process they emphasize that help create a diverse, equitable, and inclusive funnel. If you’re looking for resources on eliminating bias in hiring, Google’s re:Work site is one of my go-to’s.

THEY DON’T FORGET ABOUT ONBOARDING: I’m just going to say it… Great hires who take 6 months to start contributing aren’t great hires. Effective onboarding is more than just prepping a new employee’s desk and computer. As Reid Hoffman, co-founder of LinkedIn says, when onboarding is done REALLY well, it’s about “eliminating confusion, building connections, and giving people a few quick wins.” The HR leader you want knows how to share the work required to get people welcomed, set up, connected, and pitching in right away — and how that work differs by team.

How to test for this: Ask how the onboarding process worked at their last company, step-by-step. What did they do to improve it? What parts did they own vs. what did they rely on managers to do? If the process covers the employee’s first week only, or wasn’t consistently applied, that’s a sign they may struggle to rein in your new employee experience. Ideally, the onboarding experience teaches the new employees about how the company makes money, their cultural values, who to go to for help, and emphasizes the manager’s role in clarifying ways of working and what’s expected for their first few months. If you hear answers that focus on new employee paperwork, healthcare, and IT setups, that’s a bad sign.

THEY’RE BUSINESS FIRST, HR SECOND: The best CHROs consider themselves important members of “Team #1” — the Executive Leadership Team. They make it a point to understand how the company works: What you sell, how you make money, and what your customers value. They can swoop into any department and quickly gather enough context to help, even if the issue is complex and involves more than “just HR.”

How to test for this: Ask them to explain in simple terms the products their last company sold, the most important company-wide strategic initiatives, and how their work in HR supported those initiatives. If you get a sense that they’re doing their own thing in HR, dig deeper into how they’re structuring their work to support the broader business strategy. How did they use “what mattered most” for the business to prioritize what they built and focused on? If they can’t articulate the general strategic direction of the business, or it seems that they’re only focused on improving the HR function, probe deeper to understand why.

THEY USE FEEDBACK LOOPS: Beware of the People Ops head who sees building a process as a “one and done” exercise. You want someone who makes things better over time via intentional listening and observation. What’s working? What’s not? What’s hard, and what else do people need so they can manage things for themselves? The best People leaders start with well-known best practices, but make them their own by relentlessly tweaking and improving them based on firsthand observation and listening to their teammates’ needs and pain points.

How to test for it: Ask them to walk you through Year 1 and Year 2 of a process they built — hiring, performance management, L&D, etc. Focus in on how it went the first year, the improvement opportunities they noticed, and how they took advantage of those opportunities the second year. If the improvement opportunities are surface-level, or it’s clear they haven’t gathered the data they need to know what was working vs. what wasn’t, that’s a red flag. You should be listening for clear articulation of the gaps, the plan they built to close the gaps, and the results they created by working the plan.

…and the traits that matter a lot less

DEEP EXPERTISE IN LEGAL AND COMPLIANCE — Knowing the law and keeping the company out of hot water matters, but you need more than just an auditor for your employee handbook. A SHRM or other certification can give you the confidence that someone has a baseline understanding of the HR rules of the road, but make sure you push candidates to give you more than just how they keep the business compliant. You’re looking for a credible member of the executive team, not a traffic cop. (I’m just going to leave this here: Some of the highest-performing People Ops leaders in our portfolio aren’t SHRM-certified.)

BEING THE CHIEF HAPPINESS OFFICER — Bringing teams together, recognition and awards, and celebrating birthdays and other milestones can be fun. But they shouldn’t be the responsibility of a C-level executive. Ask this simple question: “How do you avoid being dragged into too many day-to-day office management and employee issues?” If they’re unable to articulate how they delegate these duties, or if their stories all seem to gravitate on “building community”, you’re likely going to be frustrated later on when they can’t build basic people-focused business practices and make them stick. Happy employees matter, but helping people do meaningful work with managers they respect is how you make people REALLY happy.

COMPENSATION & BENEFITS KNOWLEDGE — This is what compensation databases and benefits brokers/consultants are for, especially for smaller companies with more manageable workforces. If this person can own and drive your benefits selection and open enrollment process (themselves or through their team) and be your thought partner on how to reward people fairly, that’s more than enough. If you’re looking for more specific compensation benchmarking, decent sources are easy to find: Payscale (for anybody) and AdvancedHR (for those in the startup/VC/PE community) are both good places to start.

THERAPIST MINDSET — Every manager needs to leverage closed-door coaching conversations once in a while. But there’s so much more to this job than listening to individual employee complaints. If an HR leader seems to get pulled into endless 1:1 conversations with frontline employees, that’s an indication that they don’t know how to create leverage for themselves. (In some cases, it can also be a sign that they actually enjoy being part of the drama.)

Paul Stansik is a Principal on the Operations team at ParkerGale Capital and focuses on helping companies make the most of their growth opportunities. He lives in Chicago with his wife, Annie, and their dog, Maxwell.

I help small technology companies build stronger teams and make the most of their growth opportunities.