Three HR Blind Spots That Can Stall Company Growth

Companies experiencing growth are on an exciting journey, but as part of that journey, many businesses tend to overlook critical human resource (HR) functions such as early implementation, failing to prepare for scalability, and prioritizing immediate needs over long-term vision.

Having worked in HR for nearly 20 years, I’ve seen the impact these missteps can have on businesses, so let’s check each of these blind spots to help you build a more resilient and future-proof organization.

Blind Spot #1: The High Cost of Deprioritizing HR

Many companies experiencing growth tend to view HR as something that can be handled by a jack of all trades, with many leaders taking it on themselves as an administrative function or delegating it to someone without specialized expertise in an effort to minimize costs. In my experience, this approach is a gamble, and the risks are higher than you might think.

The Risks of Waiting to Hire HR

All too often, companies don’t realize the benefits of implementing strategic HR involvement until after they’ve surpassed an inflection point that signals rapid growth, missing the opportunity to have a plan in place ahead of transformative milestones and increasing the following risks:

Reactive Problem-Solving, such as quickly hiring someone with only the skills needed to address your immediate needs, moving someone into the position in the midst of a crisis, or outsourcing to a professional employer organization (PEO).
Decreased Productivity due to those in leadership roles needing to focus on tasks that could be handled more efficiently and effectively by a dedicated HR professional.
Missed Opportunities for Acquisition and Retention because business elements that are important to scaling—such as employer branding, culture building, and organizational design—are often neglected.
Expensive Mistakes, including legal or compliance missteps, poorly negotiated benefits, and the implementation of systems or policies that lack the potential to grow at scale.

When to Bring in a Dedicated HR Leader

While many companies can “get by” without a dedicated HR leader in the initial stages, the ideal time to bring someone in is before any period of rapid growth, such as between funding rounds or when the volume and complexity of HR tasks start to outgrow your current capacity.

Once in place, a dedicated HR leader should focus on a number of priorities, which may include the following:

Developing and implementing effective hiring processes and practices—including onboarding—which can have a significant impact on employees’ ability to succeed, their feelings about the company, and how long they’ll stay.
Tracking employee performance with a system for providing and receiving feedback.
Establishing a clear compensation policy that ensures that you’re paying competitively.
Making sure that the company is compliant in all areas and protected from legal exposure.

Common Misconceptions About HR

Perception: HR is a purely administrative role that anyone can handle.
Reality: Strategic HR is a value driver that directly impacts business outcomes through talent acquisition, retention, and productivity.

Perception: HR only exists to serve the company’s interests.
Reality: Effective HR professionals balance organizational objectives with employee needs, mediating issues by advocating both fair treatment of staff and adherence to company policies.

Perception: HR is only necessary when a company is “big.”
Reality: Building a solid HR foundation is about proactive problem-solving rather than reactive damage control and is crucial for effective scaling.

Blind Spot #2: Failure to Prepare for Scalability

While company growth is exciting, scalability can also present unique challenges. Considering a recent Gartner survey found that three out of four HR leaders believe those in leadership roles are already overwhelmed, this is especially true if you don’t have the right systems in place, as replacing—or worse yet, initializing—them in the midst of growth can result in unnecessary stress, inefficiency, and mistakes.

Setting the Stage for Scalability Success

One mistake companies can make is implementing systems that address just one point of the employee lifecycle, resulting in a disconnect that can be frustrating for everyone, so it’s important to consider the specific needs of your business. In my experience, the key is to think about the entire employee lifecycle—from recruitment to offboarding—from not only the perspective of your current needs but also where you project the company to be and establish these systems early on:

Applicant Tracking Systems that streamline and manage candidate information.
Human Resources Information Systems that work as a centralized database for all employee data, including personal information, pay details, and benefits enrollment.
Payroll Processing Systems that automate calculations, tax deductions, and payments.
Learning Management Systems that foster employee training and development.

Phased Implementation of Systems

While there are systems designed specifically for small businesses, you may find that you need to change or add entirely new systems as you experience growth. While some options provide additional features at an extra cost, it’s rare to find one system that does everything exceptionally well, so it’s best to prioritize those with the functions that are most important today and can also scale when needed.

Needs Assessment: Establish your current and future needs.
User Experience: Choose systems that are intuitive and easy for employees to use.
Budget Allocation: Consider it an investment in employee engagement and productivity.
Change Management: Develop a comprehensive plan to communicate any changes to employees, provide training, and address any concerns.
Progressive Approach: Break down the process into manageable chunks, focusing on the most critical functions first and gradually rolling out additional features as needed.

Key Questions to Ask When Choosing HR Systems

Can the system support all stages of the employee lifecycle?
Does the system address the needs most critical to your business?
Is the system scalable or capable of integrating with other systems later?

The Unseen Impact of Preparing for Scale

As recently as 2023, Gartner found that more than 40 percent of HR leaders reported they did not have a definitive future of work strategy, which, in my experience, tends to lead to an inability to align HR strategy with an organization’s long-term goals, opportunities, and even obstacles, and ultimately result in higher employee disengagement and turnover.

Tips to Prevent Employee Disengagement

Keep employees informed and provide regular updates.
Implement programs to recognize and reward employee contributions.
Design a performance management system that motivates and engages employees.
Eliminate cumbersome processes and tools that waste employees’ time.

Blind Spot #3: Today’s Urgency vs Tomorrow’s Vision

Startups are often torn between balancing their immediate need for execution and the long-term leadership required for a growing business. This is a common blind spot I’ve observed: Leaders focus on finding someone who can roll up their sleeves and deliver results today but lack the necessary skills to scale with the company, often resulting in their role outgrowing them.

How to Avoid Outgrowing Hires

In order to effectively hire based on both your immediate needs and your long-term vision, you need a clear understanding of what you want your destination to be. In most cases, setting a 10-year plan is fun but unrealistic, so consider the following questions from the perspective of the next three to five years and revisit them regularly as your business evolves:

What does success look like for your company?
What will your current roles look like at that point?
Do your current employees match those roles or have the potential to match them?
Where are the gaps you’ll need to fill at that point?

What to Do When a Role Outgrows a Person

According to a 2024 report from TestGorilla, more than 80 percent of employers have embraced skills-based hiring, but even if you do everything you can to hire for scale, your workforce plan is never static. Times of increased or decreased business growth, changes in business needs, and even staff mentality can result in the difficult decision to part ways with someone who is no longer the right fit.

Recognizing the Signs of Misalignment

Stalled Growth: This can be either individually or by team contributions.
Lack of Strategic Thinking: An inability or unwillingness to correlate current actions with future goals, preventing them from contributing to the company’s next phase.
Resistance to Change: Failure to embrace new or changing tools, operations, or policies aligned with the future of the company.

Taking Action for a Strategic Separation

Provide Honest Feedback: Address your concerns with the employee directly, allowing them to explain, recognize their own limitations, and have the opportunity to improve.
Explore Alternatives: Determine if there may be a different position that is a better fit for both them and the company itself.
Act in the Company’s Best Interest: While the decision to part ways can be difficult—especially if someone helped grow the business to its current point—any decisions should be aligned with the long-term success of the company.
Seek Expert Guidance: If possible or necessary, engage with HR professionals or consultants experienced in leadership transitions.

A Case for Planning Ahead

I remember a situation where a company let go of someone in a leadership role without a clear succession plan, resulting in another employee stepping into a role they weren’t quite ready for due to funding restraints. While the person originally placed in the role was a great fit at the time, they lacked the skills for the company’s current needs, demonstrating the importance of having a plan and being confident in it before making such a change. Strategic workforce planning helps prioritize critical roles and ensures that you’re hiring for the right needs at the right time.

Checking Your HR Blind Spots Before the Next Phase

By proactively investing in strategic HR, implementing scalable systems, and hiring with the future in mind, companies can better navigate the natural challenges that come with growth, address potential pitfalls, and transform HR from a reactive function into a proactive driver of organizational value. Schedule a call with Amplēo today to talk through where you could have HR blindspots.