Amy Carr was a dyed-in-the-wool marketing professional until 2002, when she and husband Reid Carr launched Red Door Interactive, a $10.4 million company that helps clients with their Internet strategies. In one fell swoop, Carr became both an entrepreneur and a human-resources director. (She won the San Diego Business Journal's HR Professional of the Year award in 2008 and 2009.) Reid talked to Inc. about the role of HR in young companies that aspire to cultural greatness.
Is marketing a good background for a human resources executive?
I didn't realize it at first, but HR is a lot like marketing. In fact it is marketing. In both roles the job is to communicate expectations, formulate goals, and define missions. You create effective programs and report on the results. Recruiting, in particular is a pure form of marketing. You're selling the company, qualifying people, and developing relationships.
What's the most important thing to consider when hiring an HR executive?
The culture fit. Of course that's important for all hires, but it's particularly important for the HR director because she's the first face that job applicants may see. So she represents the company to them in the way a customer-service person might represent the company to a customer. Also, she will be assessing whether candidates align with the company's values. If she hasn't internalized those values, then that's a problem.
At what point should companies start thinking about things like benefits, work-life balance and professional development?
Right away if you don't want your best employees to outgrow you. Bringing in and hanging onto top people requires putting in a lot of time and money upfront. We started thinking about those things almost immediately and it has paid off for us, not just in terms of keeping talented people but also in developing institutional memory. And having that foundation of great talent made it possible to attract top people from larger firms who saw we could compete.
What benefits did you establish first?
From the time we had just two employees we had a retirement plan. We've always had medical, dental, vision and life insurance, and in the beginning we paid 75% of employees' costs. We've always had at least three weeks of paid time off, and then we extended that so people could accrue more vacation the longer they stayed. And we've always had flexible work schedules because we've always had trust with the people who work for us. Putting in good benefits early is a way of building that trust—demonstrating that we expect this to be a long-term relationship and we're willing to invest in them.
What matters most to employees?
Our engagement surveys tell us that the most important thing is that they like and respect the people they work with. Number two is that they understand their job and have the tools and resources to do it effectively. Training is third, and it's particularly important to Generations X and Y. So this year we are tripling our budget for education and development and the amount of time we're encouraging people to take for that. And fourth is being recognized—celebrating success. Money matters, but it's not all that matters. Your company should be great at showing appreciation.