What’s your tactic when it comes to hiring? Do you try to pay for expertise or do you look to fill a seat with someone who’ll make do at a reasonable salary? Here’s why you should always try and pay for expertise when you can.
Experienced Hires Have Learned from Their Mistakes
I once read that experts are people who have already made their mistakes, just with someone else’s money. This couldn’t be more true. We learn so much from mistakes, and your new hire will have made bucket loads of them with previous employers. Big screw-ups in previous jobs might seem like a red flag (and there are some obvious ones that scream “do not trust this person”), but actually, mistakes tend to mean good news.
We all make mistakes, and your new hire is bound to make the odd bad decision and do a few tasks wrong. With an experienced hire, you minimise the frequency and severity of mistakes dramatically. This changes how you work as a team and how you’re able to delegate work to this person. It is better that your new hire is someone who has performed well in this role before. Experienced new hires are less likely to fall foul to the big blunders compared to less experienced recruits.
Experienced Hires Hit the Ground Running in the Right Direction
I often have CEO’s telling me that they don’t want to invest heavily in new hires, even if they have a great CV. Instead, they tell me that they can get someone who will do the job for 30% less.
In these moments, I ask myself, “why is Person X more expensive?” or “what can the more expensive person bring that the less expensive one can’t?”. After repeated assessments of the same scenario, I’ve realised that hiring someone cheaper is kind of a false economy. Why? Because the reason that ‘Person X’ is 30% more expensive is because of the value of their experience. They reduce the amount of work a manager needs to do. They come in with the experience to hit the ground running in the right direction and without any substantial support from management. They need less hand-holding, less training, and they often intuitively lock on to the purpose and aims of all the major steps your start-up or business is taking.
Experienced Hires Bring Fresh Actionable Perspective
New hires bring in fresh perspectives and tried and tested solutions for some of the most challenging aspects of the business. With an experienced hire, you’re likely to find that they bring actionable insights, not just big ideas. Further, an experienced hire is less likely to be able to bring new ideas and solutions and will have to be fed ideas from the existing team. This often places more pressure on the manager to guide the passionate, yet inexperienced, hires.
You Are Paying for an Insurance Against Mistakes
Ultimately, that 30% additional cost is a premium against mistakes. We all start off as fresh-faced new employees in our careers, and whilst the rate and severity of our mistakes dwindle over time, we still make them, no matter how experienced we are. The difference between the inexperienced hire and the experienced hire is simple. The inexperienced hire is more likely to make costly mistakes, putting more responsibility on CEOs and managers to anticipate and mitigate any damage. Often, the only way to learn not to make a mistake is to make it. So that 30% extra that you are paying is akin to an insurance premium, to reduce (not remove) the chance of error.
When to Employ Inexperienced Team Members
This article isn’t intended to bash inexperienced people or advise that we never hire them. There is certainly a time and a place to bring new team members on board who offer only a little experience but great potential to become valued and effective team members. With larger teams, where there are resources available to take fresh minds and upskill individuals to outperform in their new roles, less experienced hires are ideal to fill these roles.
For start-ups and small businesses who have limited resources, inexperienced hires can end up costing double. It may seem tempting to take on your passionate yet inexperienced friend, but if the person isn’t fit for the job, it’s probably a bad idea. The same goes for individuals who offer a lot of experience in a similar field; if they don’t have extensive experience and transferrable skills, you’re going to be hiring someone who can’t do the job as effectively as their experienced (and well-paid) counterpart.
Pay for Experts and You Will Get Expertise
I want to encourage people to think about hiring experts and valuing their experience. Think of hiring not just as a seat-filling exercise, but as an opportunity to find great people to add knowledge and skill to your team. We would be foolish to use salary size as the primary or singular criteria for hiring; the costs of an experienced hire are often always worth it.
Read more of my thoughts on business and gain valuable insights on start-ups and scale-ups by following Bamboo Orchard on LinkedIn.
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