This is part two of FAQs on launching and managing start-ups. Read part one here .
Any specific method that a young entrepreneur should follow while building his/her start-up brand?
This is very subjective and depends on the industry one is in, and the purpose. As a general rule, it is advisable to be known with a good brand recall once you have decided to hit the market.
These days, social media (LinkedIn, Facebook, Twitter and the like) all play a very important role. Especially if you come up with something novel and innovative, social media will ensure that it gets across to a large audience, at very low cost.
However, keep in mind that the brand image you would like to build for a company be consistent across all media. The power of the Internet can be leveraged at a very low cost and with a little bit of innovation.
For example, when I ran Scope E-Knowledge, we got across to our target segment of 2000+ global CxOs in the publishing area by bringing out a daily newsletter called knowledge-speak. This was the first and most influential e-paper that covered key events in the publishing industry and made itself indispensable to CEOs. It cost us very little but ensured that we had a captive audience, who could be tapped for business.
How can we retain employees (like tailors, cooks, house-keeping staff, and so on) in labour-intensive businesses, especially since they switch jobs for small salary hikes?
Employee turnover in some businesses is very high. However, the key is to identify motivations that drive such people and then, offer them the environment which would want them to stay and prevent them from switching; or at least, reduce the probability of the same. Let me explain with an example.
In the Knowledge Process Industry, the average employee turnover in most businesses was about 30 per cent plus per annum, which meant that after three years, you have an entirely new work force. While we had installed systems to capture knowledge and make it systemic as part of the process, a lot of knowledge resided in the heads of these workers, so it was very expensive when someone decided to switch. In the 2000s, most engineers would switch at the drop of a hat, since jobs were easy to come by (we competed with IT firms and they were hiring in droves). We did a few things to reduce our attrition rates:
We tried to build a culture that was mutually supportive and where the level of negative pressure was low. (A number of initiatives were taken to build this culture — it took time, but we were successful).
We deliberately recruited from Tier ii or Tier iii towns, such as Nagarcoil, Tirunelveli, Trichy, Salem and others) . We realised that they came with a great attitude and sincerity and were good in their domain. The area where they were at a disadvantage was English language. We, therefore, broke up the process, where English language editing was a separate process and people skilled in the language were recruited.
We took in a large number of women, for whom security and culture at the work place mattered more than just money. We also invited their parents to come over and hosted a separate event for them, where we interacted and explained to them the environment in which their wards would operate and how we would look after them. This ensured that there was a lot of parental pressure to prevent employees from switching at the drop of a hat.
Of course, though we paid a reasonable salary, we were not the best, since we could not compete with the IT majors but we had one of the lowest attrition rates in the industry — at below 15 per cent.
This is just an example to indicate that one must evaluate motivations of employees and look at innovative solutions right from the recruitment stage to all stages of the employment to retain good talent.
The next article in this series will look at the various aspects investors look at before putting in their money in your business.