updated 9/15/2013 11:48:59 AM ET 2013-09-15T15:48:59

When you’re a startup, every employee has to do multiple jobs. Founders can be chief engineer and chief salesman. Entrepreneurs, partners and leaders will often take on roles they never dreamed of performing as they work feverishly to grab business quickly.

That kind of multitasking is key to a startup’s success – but could also spell failure when it’s time for the enterprise to grow up.

Salesmen who never even filed their own tax return end up becoming a firm’s accountant. Lifelong operations staffers taking on compliance roles. Administrative assistants suddenly find themselves as the human-resources officers.

If you want your business to succeed and shed the startup banner, you have to be better at assessing your human capital and reassigning roles where necessary. Failure to do so could keep you from making the leap to the next level, or, worse, could wipe out the progress you’ve already made.

Here’s why:

Square pegs in round holes produce inefficiency.
At its heart, the problem is about having the wrong employee in the wrong role. If your employees are a bunch of square pegs trying to fit into round holes, you’re wasting valuable time and money. Sure some employees displayed promise during the startup phase and have had success at certain out-of-the-box functions. But, those functions get more complex as a company grows. An admin assistant who managed payroll for five workers has a bigger learning curve once you hit 50. Rather than waste resources supporting a learning curve as you ramp up, you are often better off hiring someone from the outside with a better skill set and less of a need for hand-holding. It might be uncomfortable to do because it might require managing employees’ feelings about their value to the organization. But, if done right, it’s what’s best for both your employees and for your business long-term.

You’re risking employee engagement.
If you continue to expect the "right" employees to fill the wrong roles, at some point they will get frustrated. Think about it: If you have all these mismatched workers and roles, employees have a higher risk of failure. Some may never get it right. It may not be for a lack of trying, but this kind of situation can have a severe impact on employee engagement within your company. Once employees have lost interest, it’s hard to recapture it.

You could be suffering from reputational risk.
Do you really want to be known for your inefficiencies? The busier you get, the harder it is to fake that you have employees who have no idea what they’re doing. They’re not just faking it internally. These are the people servicing your customers. You may think that no one on the outside notices, but you’re wrong. Once your customers get wind, your reputation is at risk. Remember, it only takes one bad review to hobble your success – and jeopardize your future.

You could be hurting your ability to be compliant.
Every industry has its own compliance requirements. Some have tight government-imposed regulations, while others rely on companies themselves to do most of the policing. Either way, you need people with compliance expertise in areas like legal and accounting to do it right. I’ve seen business leaders convince themselves that it’s OK to make it up as you go along or learn as you go. This might work for a little while, but it can’t last. As an entrepreneur, you must understand that the longer you wait to correct mismatches, the harder it will be later. Don’t wait until you have a legal or quality-control problem to do this assessment. By then it could be too late.

Copyright © 2013, Inc.


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