Your people are your superpower – but finding, hiring, and retaining staff that will enhance your business and set you on the path for growth is certainly no mean feat.
Our outsourced finance directors often get asked for their guidance on when to hire staff to maximise opportunities and, unfortunately, when to let them go to save an organisation from financial ruin. We’ve collected some of our commonly shared advice here.
How do you know if you need to hire staff?
Acquiring new staff at the right time for your company comes down to careful scenario planning and being able to forecast which direction your business is likely to go in as best you can.
Your decisions will also, of course, be heavily driven by demand. If your current employees are worried about their workload, they are struggling to look after your existing customer base, or the ball is regularly being dropped when it comes to delivering a great service, then it’s likely time to bring new talent into the fold.
If they know how to interpret their figures correctly, most businesses can accurately predict how much revenue they will make based on the projects and contracts they’ve got on the books or the sales figures they have been reporting. But when it comes to generating new business, very few companies know what they’re going to have until they’ve got it, which makes it difficult to know whether it’s prudent to invest in staff ahead of securing this new income or win the business first and recruit with less risk to the company’s finances.
Much of the time, the approach you take will depend on your industry, your sales and marketing strategy, and how readily available new team members are, should you need them.
If you were a client of ours, we would advise you to keep a close eye on your cash flow. This will help you decide what to invest in, and when. Looking at the current market, we also must make you aware that it can be difficult to source good staff (and, thanks to contract negotiations, long notice periods, and the mountains of administration that comes with a new hire, it can take a while to onboard them, too).
Where to look and how to market your vacancy
It is entirely possible to recruit without external support. Job ads, print ads and/or social media posts will help to raise awareness of your vacancy, and word of mouth plays an important role in getting the right person in-house, so do utilise your network.
However, in our experience, it is often better to enlist the help of a recruitment freelancer or agency with specialist industry experience. If you make the wrong decision now, you may experience significant financial and operational issues further down the line when you realise that the person in question is not, or cannot, deliver what you need. Having help from an objective third party who knows what questions to ask and what red flags might derail your efforts can be invaluable.
As with many aspects of business, good recruitment usually comes down to who you know, not what you know. It’s always worth meeting and nurturing your relationships with suitable recruiters just in case a new position becomes available, and you need them to act quickly on your behalf.
Attracting the right people for your position(s)
It’s one thing to attract the attention of a potential new employee, and it’s another to get them to commit to taking on a role with you. Ultimately, if you want to turn the heads of the very best people, you need to give these individuals good reason to want to work for you.
Wages aside, bear in mind that, in 2023, workers are increasingly looking for perks that meet their expectations of our post-Covid economy. For example, working from home or flexible working policies are not just a luxury for many people; they will actively be seeking employers that are willing to give them back more control of their time and their output. Similarly, benefits such as enhanced annual leave, private health insurance, life insurance, and gym or wellness initiatives will help to keep your package competitive. As long as they are reviewed regularly and continue to offer value in the long term, such incentives will also go a long way to keeping these staff on board for many years to come.
Assuming your candidate has the right aptitude for the job, you’ll also need to make sure they have appropriate interpersonal skills and are a good cultural fit for your office. You won’t know if they are a sure bet until you spend more time with them. If you are recruiting for a senior appointment, invest time into finding out more about your potential new employee. Take them for lunch or dinner, or invite them to shadow you and your team for the day. You’ll be surprised how much this additional time could re-shape your view of them.
What happens if your business outgrows a member of staff (and their skillset)?
Every business starts out with the people they can afford. And eventually, these people may no longer have the skillset to help that business achieve great things.
They may also not have the mindset required to drive the company forward. Many employees can be perfectly competent, but competency often leads to comfort – and nobody can improve themselves or the business they are working for when they have committed to staying in the same place and doing the same things.
It’s quite common for a company to outgrow its employees. If you find yourself concerned that current team members are underdelivering, resisting new and more efficient ways of doing things, or simply having a negative impact on the performance of your wider team, big decisions will need to be made as to whether they can continue to hold your organisation back on its pursuit of growth.
It is your responsibility to provide your people with the training and support they need to do better – or perhaps even alternative opportunities within the business – but if things are still not working out, it could be time to take action (with tact, sensitivity, and an understanding of the terms of your employment contracts and lawful layoff practices, of course).
Letting go of your employees should always be the last resort
How long do you keep your staff for, if you’re losing sales or contracts because of internal issues or the wider economic climate? It’s a tricky one, and in our view, all other options need to be explored before you commit to letting people go. After all, people’s lives and families will be affected – and from a purely corporate perspective, conducting the process in the right way can be time-consuming and costly.
The onus is on you, as the business owner, to make decisions that prevent the need for redundancies. Our financial consultants can step in now to help you set a plan in place way ahead of the problem. Having a professional on board to clarify your position and explore all options might make sure that any potential cuts are not as deep to, or hard on, your team.
There is another course of action…
Of course, there’s also a third option: training your employees so they have the skills you and they need to grow your business in the right direction. If certain members of staff show great promise and the willingness to learn, it may be more cost-efficient and operationally effective to upskill them instead of hiring from outside the organisation (and that’s without mentioning the benefits that internal promotions can have on the morale of the employees you’re investing in).
Our part-time finance directors have extensive experience in supporting businesses through recruitment and redundancy processes. We also have the skills to assess your finances and help you prepare for change in either direction. Get in touch with Dartcell today for more information and to discuss your challenges in more detail.