Business Essentials: Give people a web job and they only stay long enough to clone your idea

A new online firm needs to recruit staff, but how can it stop them learning, leaving and starting rival sites?
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The Independent Online

"I have a number of friends who run big websites, and they say that 80 per cent of the competition are people they trained," he says. "I've checked out these websites and they're almost exactly the same as the original ones. The people come in, learn about the business, realise it's a great idea and go off to get a loan and do it themselves. I want to know the best way to avoid this."

Mr Kenton's company, Sportsbase, is an online directory of sports and health clubs, which brings in revenue through advertising. "The website provides information to the public in a way that has never been done before. For the first time, people can find their nearest club with over 70 sports to choose from, all on one website."

Mr Kenton and his business partner, Robert Taub, founded the company in November and started trading in March. "Our official launch was in May and so the time has now come to employ people, particularly as Robert will be away for a few weeks and I'll need to cover for him," says Mr Kenton. "It's crucial in these early stages to have people to help get the business off the ground."

While Mr Kenton and Mr Taub anticipate taking on one or two people initially, it may turn out that they need another five or more quite quickly. The business, based in Barnet, north London, might even require up to 30 employees by the end of the year. "That might sound weird for a start-up. But our idea could really take off."

Employment will be temporary, with a view to becoming permanent, he adds. "The people need to cover everything from administration to marketing to maintaining the site. This leaves me with two choices."

The first is to get "all rounders" in. "They would be capable in all these areas and would probably be graduates or young professionals who are ambitious and able to approach things in an entrepreneurial way. Un- doubtedly, these would be the best types of people to take on because of the skills and creative ideas they'd bring in. On the other hand, it would represent the greatest risk in terms of their running off and setting up a competing business."

The second choice is to get in people who would focus on certain areas of the operation. "They would have more experience and they would do something specific like secretarial work or marketing. The upside of this is that they'd probably be more loyal, but the downside is that they wouldn't have such diverse skills and we couldn't move them around the business in a flexible way to respond to our changing needs."

Mr Kenton would also welcome any other advice on how to prevent people leaving to set up a competing business. "We have put a lot of time and effort into this website."

www.sportsbase.co.uk

WHAT THE EXPERTS SAY

Vanessa Robinson, Organisation and Resourcing Adviser, The Chartered Institute of Personnel and Development

"One of the main issues for Mr Kenton appears to be the potential tension between competing loyalties: to the organisation and to the individual's own interests. These can be resolved through a variety of practices designed to build a positive corporate culture.

"Communication is important here, as are measures such as mapping out a staff member's long-term career development. These could help to secure loyalty and retain knowledge.

"It might also be worth considering including a clause in the contract to ensure that both temporary and permanent employees do not set up their own competing business within six months of leaving."

Tom Hadley, Director of External Relations, The Recruitment and Employment Confederation

"The risk of staff setting up rival companies can, to some extent, be addressed by including specific clauses in the contract of employment. If and when employees do get itchy feet, one option is to encourage them to set up complementary, rather than competing, businesses. Mr Kenton would then have the option of taking a stake in these new operations.

"Effective recruitment is one of the big challenges facing growing businesses, and good temporary workers can help address immediate needs at a time of nationwide skills shortages. For roles such as marketing, Mr Kenton should recruit people with extensive experience and good track records, rather than 'all rounders'. A number of firms are using interim managers who can make an immediate impact but also develop more junior staff.

"Remember, too, that many highly skilled job-seekers, such as women returning to the labour market, are keen to work on a flexible and part-time basis. So Mr Kenton could, for example, hire a marketing manager for a few days a week as well as specialised staff in other areas."

Philip Wilkinson, Business Adviser, Business Link for London

"A personnel structure that appeals to everyone, appropriate to their individual needs, should be implemented. This is about offering a work-life balance, a positive environment and a training and development scheme. If the employees feel they are being challenged and have a role in the way the business is being driven forward, they will be less likely to leave.

"All workers also need a financial incentive. One of the best ways for a small business to provide this is through an employee share-ownership plan. These schemes are very effective in linking the interests of the business and the staff, ultimately encouraging long-term commitment from the workforce."

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