Growing pains. We all experience them at some point or another when we start to scale up our team to support our growth.
On a superficial level they may seem burdensome, but hidden beneath are positive messages of development, growth, and opportunity.
When you're working to build up your team’s skills and capabilities, you are faced with two choices: either you can hire new employees or you can invest in developing the team you have.
Hiring, while it has its advantages, can be difficult, expensive, and time consuming.
Even though new hires will eventually contribute to your roster of talent, it takes time for employees to become familiar with the role, the culture, and what you do, as well as how you do it.
When you invest in employee growth and development, however, you have all of those things already in place and you're simply focusing on installing new skills in an already talented resource.
There’s a place for both strategies, and it may not always be possible to train for success, but when it comes to making the most of your time and resources, investing in the development of your existing team is almost always the better way forward.
This article will address:
Data examining both sides of the argument
A breakdown of the pro’s and con’s of each approach
How you would best be served as you move forward, with supporting resources
Support for Hiring New Talent
When hiring an external candidate, the business carries a lot of risk. It can be expensive to recruit a new employee, and often means a loss of productivity while that position is open and again while you are training the new hire. There are some advantages, however, to looking outside your organization for new talent.
Hiring from the outside can help you build a more diverse team
A new employee will bring with them fresh perspective and ideas
External hires generally have a more diverse and wider range of experience
External talent can bring skills, knowledge and capabilities not currently available
New tools and services make it easier than ever to review a large pool of qualified candidates
Hiring an external candidate requires that you screen well for cultural fit and commit to training the employee and bringing them up to speed, but if you invest in the right new talent, they can help take your organization to the next level.
Support for Training Your Existing Employees
Retaining and implementing an employee development program may seem daunting but this is often your best option, especially when you consider that a new hire costs 18 percent more than it would to promote an internal resource to the same job. An additional data point to consider is that research shows that new hires often receive worse performance reviews and are 61 percent more likely to be fired. Furthermore, there is the matter of “ramp time”: new hires can take up to two years to close the “performance gap” with internal talent that was promoted into similar roles.
Even if it may seem difficult to train an existing team member to fill the role that you need, the cost of hiring from the outside can be great, and the cost of losing employees is even greater. Having an unfilled position, either from termination or attrition, can be expensive, as human resources consulting company, Human Resources 4U explains:
“In the long term, the company will need to continue producing goods or services once the employee is gone, but at least in the short term, will have fewer human resources available to produce those goods and/or services. A heavier burden will fall on the remaining workforce and they will be expected to increase their productivity. The company must anticipate how these additional stresses on the workforce, the company’s finances, and public image will be addressed prior to implementing the termination.”
One other thing to consider is that if you consistently hire from the outside instead of promoting from within, your existing employees may feel that there is less opportunity for advancement, a lack of growth opportunity, or that they are “undervalued”. All of which serve as strong predictors of talent retention issues in your future.
The research shows that unless your organization is in desperate need of new skills and perspectives or is experiencing a tough corporate turnaround and strategic shifts, that employee retention and development is the best way to go. External hiring is expensive and uncertain. So, how can an employer turn a challenge into a success story?
Listen to Your Employees
If an employee is disillusioned, or otherwise at-risk, it is your job as an employer to listen. Rather than leading authoritatively, consider having a candid conversation with the employee where you give them an opportunity to openly discuss their concerns with you. Don’t assume you know their reasons or that you have all the answers. Instead, listen and you may learn a thing or two.
The Wall Street Journal offers a couple of tips that employers can practice to maintain (or increase) morale and retention rates within an organization:
Make sure that your benefits package and perks are competitive with other companies that you competing with for talent
Ensure that you provide current employees with financial incentives such as raises, bonuses, and stock options
Consider hiring a human resources manager if your company is nearing 100 employees
Make sure employees know what's expected of them and how they can grow within the team and the company
Invest in Your Employees
There are more resources now than there ever before to help you invest smartly in the professional development of your team.
Taking advantage of these resources and making these investments is critical, whether your company is working to deal with difficult changes or simply trying to scale up for growth.
If you’re aim is to develop your team's ability to serve, retain and expand your customers, SuccessCOACHING is a customer success management program that provides comprehensive training resources for customer success managers and teams or anyone that is looking to improve their current customer experience.
We offer hands-on and self-study training that helps your company stay up-to-date with best practices and teaches your team how to better address customer challenges. Click the button to learn more about our on-demand courses.
This article addressed the challenges associated with training current employees or hiring external candidates.
While there are pros and cons for each route, and there’s no one-size-fits-all approach, we believe that the benefits to investing in your team’s professional development far outweigh those associated with hiring new talent when it comes to adding or improving the skills and knowledge of your team.
Your company’s culture and hiring needs are unique, so carefully consider both options and keep these in mind:
Do’s & Don’ts
DO carefully consider the pros and cons of hiring versus investing in the development of your existing team
DON’T overlook the skills and talents of your existing employees
DO listen to your current employees
DON’T forget to consider the associated costs of a new hire