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Find, Train, Retain: How Start-Ups Are Banking On HR Tech

From simplifying recruitment to identifying potential employee issues and spotting talent gaps, start-ups are leveraging HR tech tools to efficiently manage their workforce challenges

Find, Train, Retain: How Start-Ups Are Banking On HR Tech
POSTED ON March 30, 2023 12:24 PM

Layoffs have emerged as the dreaded buzzword in the start-up ecosystem over the past few months as many companies let go of thousands of employees. This development also put one department under much stress—the human resource (HR) team.  

While on the one hand, they had to finish the exit formalities for departing staffers; on the other, they had to find ways to enhance employee engagement and increase productivity amongst the existing staffers. This was in addition to hiring talent for specific roles powered by artificial intelligence (AI) and machine learning (ML) powered skills. Fortunately, they could take recourse in tech tools to simplify the human capital management (HCM) process management, especially while onboarding new employees.  

Over the years, start-ups have realised the merits of having a robust and automated HCM process in their journey's early stages when focused on scaling their business. During this initial phase, when they struggle to turn a profit, HCM can assist them in managing their limited finances better while hiring, training or onboarding talent. 

Ruchika Chawla, HR head at gaming start-up Rooter,
Ruchika Chawla, HR head, Rooter

Ruchika Chawla, HR head at gaming start-up Rooter, cites a research report by, which claimed that 23 per cent of start-ups fail because they hire inefficient people. "Modern HRMS (human resource management software) platforms like HROne that we use have worked wonders in increasing work accuracy and HR productivity by reducing manual errors and paper-based processes. We used it across our HR function starting from recruitment, onboarding, leave and attendance policy, employee information management, governance, compliance and policy implementation, payroll and exit process management," she adds.   

Have Tech, Will Use 

A recent Humaans research found that 76 per cent of the 1000 HR managers surveyed would like to invest in HR tech in 2023, underlining its importance. This is unsurprising, according to Sumit Sabharwal, CEO of TeamLease HRTech. He notes that these products automate all HR operations from pre-hire to post-retire within start-ups, making them more well-structured and time effective.  

"Today's start-ups aren't dependent on error-prone spreadsheets to manage their payroll. On the contrary, they are empowered by HCM products like one-click payroll and zero-touch Applicant Tracking Systems (ATS) that have increased accuracy and reduced efforts tremendously," he adds. 

Rooter shifted to an HRMS platform when it had 30 staffers. Today, its 105-member strong team leverages it to collaborate, engage and solve workplace needs through active technology deployment.  

"HROne has helped us tremendously adapt to remote and hybrid work situations post the pandemic. Payroll processing has simplified as attendance, leave, and investment declarations are managed from a centralised platform. Also, automated calculation of taxes and fillings has streamlined employee investment processes. Overall, we've seen increased HR efficiency and reduced costs," Chawla notes. 

HCM can also help companies get accurate performance ratings by ensuring appraisal reviews are based on observable behaviours instead of subjective evaluations of individual traits of the interviewee and interviewer. Elaborating on this Sudhakar Raja, founder and CEO of TRST Score states that task and Objectives and Key Results (OKR) based performance appraisal is the ideal way for doing any reviews.

Sudhakar Raja, founder and CEO of TRST Score
Sudhakar Raja, founder and CEO of TRST Score

“To track these tasks and the performance of these tasks is where HR tech companies can play a major role. An analogy of this would be taking an Ola Cab ride and rating the driver based on that ride or using Urban Company to hire a plumber and rate that person’s service,” he explains. “Even these have an element of subjectiveness to them if you think about it. You could have had a good driver but maybe the car was not clean because of an earlier rider making a mess. Similarly, a task could also have external factors that influence the outcome which is where familiarity would help you overcome such issues.”

The Feel-Good Factor

Using technology as an aid comes naturally to many digital-native start-ups, especially when they want to introduce new services or alterations to existing HR operations from pre-hire to post-retirement. This was also fuelled by the pandemic when the lockdown radically changed the hiring and onboarding of new employees.  

With entire teams working remotely, they could provide candidates with a smooth experience throughout the recruitment process, including identification, interviews, assessments and salary negotiations, courtesy of technology.  

Santhosh Reddy, CTO and co-founder of Bengaluru-based supply chain start-up ShakeDeal, believes that intelligent recruitment through the employment of AI and ML is fast catching up now, wherein AI is used to understand the skillset and cultural fit and undertake the entire process of employee screening, saving time for HRs to lay focus on other essential job tasks. The technological integration of AI and ML has made the tasks of HRs simpler by eliminating redundancy and driving engagement to make hiring top talents easier and more cost-effective.  

SurveyMonkey recently polled 1500 staffers in collaboration with Bonusly and found that 82 per cent of respondents considered recognition an essential part of their happiness at work. In another industry poll, 56 per cent of HR leaders told the Society for Human Resource Management that employee recognition programmes help recruit top talent. This shows that recognising and rewarding go a long way in retaining the right kind of talent.  

Santhosh Reddy, CTO and co-founder of ShakeDeal,
Santhosh Reddy, CTO and co-founder of ShakeDeal

"The Voice of the Employee (VoE) analytics is yet another emerging technology that analyses employee engagement to figure out where the issues are. Moreover, chatbots and virtual HR help desks have come into the spotlight, which allows recruitment and improved management of top talents in the industry at a reduced cost," Reddy notes. 

The Human Touch 

While there is still no substitute for the human interface, technology can undoubtedly bridge the gap when it comes to remote collaborations, apart from increasing the efficiency of the HR function. HCM, HRMS, AI, ATS and GRC (governance, risk management, and compliance) are increasingly becoming an indispensable part of the current HR ecosystem in start-ups.  

"These tech-backed HR tools have automated administrative tasks and enabled HR professionals to make data-driven decisions while running the function. AI and ATS tools have smartly transformed the recruitment process by mapping data, sourcing, and screening applicants. They help identify bottlenecks in sourcing and provide better filtering options," Chawla maintains.  

Similarly, performance management has become highly transparent as organisations can drive a culture of high performance through tech-enabled objective defining and mapping tools. Lastly, GRC tools support compliance management needs.       

Since start-ups work in tightly bound, data-driven operations, time efficiency is imperative to keep things rolling smoothly. However, data organisation and management are complex tasks that leave much room for human errors and redundancy. HR technology has reduced this redundancy and margin for such errors.  

"The application of such technology has been incidental in driving better organisational efficiency, cost-effectiveness and employee engagement. It's also making the end-to-end tasks of HR simpler and seamless, be it from talent hunting to payroll management," Reddy states. "Therefore, it's safe to say that the HR process has been streamlined, and productivity has been maximised via the automation of repetitive tasks and employee development through AI-based coaching tools and virtual assistants." 

HR tech platform enables start-ups to take a data-first approach to managing their human capital by providing advanced people analytics for quicker and more accurate forecasting of their workforce requirements. By leveraging ML algorithms that are enabled with predictive analytics, HR managers can detect warning signs in employee engagement, and subsequently step in to take proactive measures as well.

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