The truth is that any enterprise, large or small, at one point or another is in startup mode- either a whole new line of business, pushing an organic innovation, or keeping up with the competition.

People (acting in firms) don’t only buy to ease pain or to help ensure health (painkillers v. vitamins). To extend the metaphor, people buy to get stronger faster (steriods), for sheer experience (LSD), or maybe to look and feel cool (tobacco).

Some startups are bringing innovation that simply can’t be had elsewhere, while others are bringing better value to existing forms, while still others think they are doing one or the other but are actually net value eaters.

The depression will spell doom for many startups, but it will be the cause of creation too as people seek ways to make a living and to do things better.

One thing I have realized along the line is that “HR” is a vast field, and growing by the month because human capital is replacing financial capital as the key driver of business success- and maybe even more so when financial capital temporarily does become scarce and heavily scrutinized.

So another frame for this question is this: How does HR stack up as a marketspace during this situation as compared to other marketspaces ? The answer is likely “pretty darn good”.

In the 1980s marketer Regis McKenna articulated the use of ’silver bullets’ as a solution to the scope-creep/no-decision yuck that even pain-killer solutions encounter, and his lessons apply equally well to hr startups today as they did then to silicon valley garage shops.

Some trace ‘Silver bullets’ back to ancient folklore as being the only way to kill witches, goblins, vampires and werewolves, so no surprise they work also on corporate buying committees.

The tough part is figuring out what your silver bullets can be. I wrote a post http://www.staffingtalk.com/2009/01/silver-bullet-your-way-to-staffing.html on how one of my companies found its silver bullets.

Free-trials, consultations and training often make good silver bullets for HR startups. Put some work into it.

How can you make your silver bullet authentic and cost-efficient? How can you market your silver bullets? Tough but necessary issues for a startup to address.

The painkiller vs. vitamin debate is a critical one, but it’s also tough in HR where there are a ton of vendors, and their value propositions and messaging overlap considerably (and perhaps more their messaging than their value proposition.)

What I’ve seen is a propensity for major scope creep on the part of customers – where you go in with a key painkiller for a specific problem only to get embroiled in trying to solve other problems as well.

There’s no such thing as 1 painkiller for EVERY problem, but I understand the inclination towards that mentality – and that’s extremely challenging for startups that are focused on solving 1 thing well.

As someone who has vetted, influenced and made many go/no-go decisions from the “Big Company” perspective regarding HR/recruiting solutions, the follow descriptor nails it for me.

“Painkiller vs. Vitamin: Is your solution a “nice-to-have” vitamin or a true painkiller?”

I would say that it’s the biggest showstopper in green lighting and adoption of a innovative HR/Recruitment solution. In my experience, the most common mis-steps in getting that green light have been:

1. they don’t present a crystal clear line of sight to how it will actually kill the pain vs the band-aid or just be a nice to have.
2. they solve for the generic market pain, but don’t easily scale to solve for the acute pain that is showing up for a specific industry or function.
3. Vendors didn’t take the time or just don’t have the intelligence of the “pain” to demonstrate real application for that companies that pain.
4. They don’t put skin in the game in the form of a pilot. By the way, I don’t think vendors should do free pilots vs discounts and I also think it should require a measurable service level agreement because many corp. recruiters wont step out of there comfort zone to work and will then scapegoat it as not working or some other excuse.

Much of the above may be the basics to some, but I can’t tell you how many vendor pitches I’ve sat through that completely miss the opportunity to execute the above and lose the biz. In some cases it’s clear to me that they don’t have recruiting in the trenches experience as a reference.

Thanks again for the thought provoking post

Check out this post regarding a strategy adopted by Australia tourism to combat recession.

http://www.vfreshers.com/best-job-in-the-world/

Hope you find it interesting !!

Unfortunately I have seen a lot of start-ups go under, since everything else them is sinking. However, I feel smart companies that act fast can take advantage of opportunities due to the economic climate.

One thing I saw on TV the other day was how new businesses are actually starting due to the economy – people who are laid off are becoming entrepreneurs and taking a new route in their professions. This is great! I really think the current “situation” will spawn a new generation of companies over the next several years.

Cheers!
Jessica
Akken Staffing software and Recruiting software”>

We talk to three to seven different hr startups every day and invariably they’re focused on some ‘unique’ innovation [exemplia gratia: "we're the first ones to put salt on our french fries!"] when first order of business needs to be MARKETING THEMSELVES.

Great post all around…cheezhead is king.

Gregg Dourgarian
CEO, Tempworks Software