A new 6-man Guardsman Squad is a rather weak unit, probably the only ranged squad in the game that can be threatened by a Scout Squad. Any Guardsman Squad that intends to see combat (in contrast of just being used for capturing resource/victory points in 1v1) generally needs the Sergeant squad leader right away. This increases the squad's staying power and damage output (although it still cannot stand up to early-game heavy infantry units), as well as decreases Requisition bleed since reinforcement cost is halved to only 9.6 per model.
The Flamer upgrade is also available in tier 1, but should not be purchased lightly. In some cases it may enable a devastating raid on the opponent's generator farm, but in a combat sense the flamers are problematic. Their range is very short, and Guardsmen really don't want to be close to the enemy, often leaving the flamer-equipped men to sit on their hands when the squad is at its natural fighting range. Additionally, the squad cannot upgrade to Plasma Guns in tier 2, effectively handicapping the unit against Space Marine or Chaos Space Marine opponents.
In tier 1, the Guardsman Squad is effective against light infantry units and in focusing down enemy heroes. Using a Sentinel to draw fire and Guardsmen to repair it is an essential early-game technique for the Imperial Guard. The Sentinel can also protect the Guardsmen from melee units, as well as disrupt enemy ranged units and crush their cover.
In tier 2, the squad has access to the aforementioned Plasma Gun upgrade, which makes Guardsmen very effective against heavy infantry (the damage is often underestimated, but it is on par with Tactical Marines equipped with their Plasma Gun upgrade – with two such squads, the potential is significant).
The other tier 2 upgrade is the Commissar, which gives two more men, another free model upon reinforce (lowering the cost to only 6.4 per model, assuming the squad has the Sergeant as well) and the Summary Execution ability that breaks retreat. This unique ability can be used to bail the squad out of a dangerous situation with retreat, then using Summary Execution to cancel it (and avoid wasting time on the long run to HQ and back out again). The Commissar upgrade is very good, but also a significant investment, as 2+ twelve-man Guardsmen Squads raise your upkeep and population count quite a bit.
In tier 2, Sentinels often die to advanced anti-vehicle or anti-heavy-infantry weapons, but the Chimera transport becomes available. This vehicle has excellent synergy with the Guardsmen, who can pop inside to avoid a melee unit, grenade or global ability, drive off if necessary, then pop out to repair the Chimera if it was damaged.