How HR Keeps Pace in Growing Companies

By Caudron, Shari | Personnel Journal, November 1993 | Go to article overview

How HR Keeps Pace in Growing Companies


Caudron, Shari, Personnel Journal


Talking to human resources professionals in rapidly growing companies is a bit like talking to parents of infants. They're exhausted, excited and incapable of holding a single thought for long stretches of time. They talk quickly, are eager to share information about their challenges, and their enthusiasm is infectious. Although they realize that many, many other people have survived the experience, they wonder how and question what the future will look like two, three or even five years from now. Instinctively, they know that the challenges they 1 face will never go away completely, they'll simply change with time.

Managing the HR needs of a small, fast-growing company is indeed like trying to manage very young children, says Barbara Beck, director of human resources for Cisco Systems in Menlo Park, California. In just four years, the computer-equipment company has expanded from 50 employees to more than 1,500. As she puts it, "Our company has gone from infancy to young adulthood without spending any time in the adolescent phase."

Believe it or not, despite all the ink out downsizing, there are hundreds of mall companies that, like Cisco Systems, are growing at exponential rates every year. Among the countless small companies that are actually adding people to the payroll is MVM Inc., a provider of security services based in Falls Church, Virginia, that has grown from 300 employees in 1990 to more than 1,200 today. There's also Melaleuca Inc., a direct-marketing company in Idaho Falls, Idaho, that has grown from 150 employees and $16 million in sales four years ago to 1,000 employees and $200 million in sales today. Then there's Gateway 2000 in North Sioux City, South Dakota, which assembles and sells personal computers. In just two years, the company has more than doubled its work force, from 1,200 to 2,700 employees.

Adding employees at this rate can be an HR headache or a celebration, depending upon how well the personnel department has prepared for growth. In growing companies, the HR challenge lies not only in providing HR services, but in growing the department itself. PERSONNEL JOURNAL talked to the HR directors of several small but rapidly growing companies to find out how they were managing the growth of their departments. We found that there's no absolute right or wrong way to develop an HR function, the process depends largely on the:

* Type of business

* Resources that are available

* Interests, expertise and goals of the directors themselves.

Because there are no hard-and-fast rules about developing an HR department, we thought that we'd let the human resources directors who are facing this challenge speak for themselves about their experiences.

PERSONNEL JOURNAL: When-and why-did your company create a formal human resources department?

Barbara Beck, Cisco Systems: I was brought on five years ago when there were just 40 employees. At the time, Cisco had an employee in charge of recruitment who was just starting to develop the personnel files. My job was to formally establish the human resources function, to help with recruitment, to establish the compensation plan and to help in discussions about how the company should be structured.

David Jackson, Complete Health Services: I took over as director of personnel three years ago when there were 250 employees. Until that point, there was no formal personnel department. Human resources activities were being managed by the director of administration, but there was no centralized function. I was brought in to formalize the human resources department. Because we were in such a high-growth mode, one of my first responsibilities was recruitment. In the beginning, 50% of my time was spent coordinating recruiting activities.

Meg Hawthorne, Clean Sites: There has been a formal HR department since the organization was created in 1984. Why? Because if the organization was to succeed, we needed credible employees and people who were respected in their various constituencies. …

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