Posted on August 21, 2019 by staff

When is the right time to hire?


I’ve lost count of the number of golden and diamond wedding anniversaries I’ve reported on over the years but they all have one thing in common. Whenever you ask the happy couple for the secret of a long and successful marriage they always give the same answer.

“It’s all about give and take,” they reply. The question in business that always gets the same answer is this: ‘What’s your biggest challenge?’ If I had £1 every time a CEO or MD has replied ‘recruitment, recruitment and recruitment’ I could retire now! Knowing you have to recruit is normally obvious but knowing when is much harder.

Lorna Davidson is the founder of Liverpool-based tech company RedWigWam, which matches employers online with temporary workers. She sold her previous business Tactical Solutions to printing giant St Ives Group in 2011 for a multi-million pound sum and admits to not always getting her recruitment right.

“When you decide you need someone it’s already too late,” she said. “When I set up Tactical Solutions I recruited 10 sales staff straight away because I didn’t have a business without staff.”

However when Davidson set up The Mothership Group, which includes RedWigWam, she admitted she hired too quickly.

“I recruited a team of six people who were brighter than me, very likeable and had the same moral compass but they weren’t necessarily entrepreneurs at that point,” she said.

“The business wasn’t where it needed to be to support them. One problem you have is the person you recruit now might not be the right person in a year’s time. Very few people are right for the whole journey but you can both benefit in the meantime.”

Susanna Lawson is the co-founder and CEO of Manchester-based learning and development software company OneFile and has this piece of hiring advice. “You don’t need the full year’s salary up front you just need to make sure you have the monthly costs,” she said. “A lot of people say that they don’t have say the £24k they need to pay someone.

I would say the right time to hire people would be a month or so before you would need them to be productive.

“At the start you will be doing the training which means that you will be less productive during this phase too. But ensuring enough build up means that you have time for training before you actually need them.

“As soon as you can start to hire people that are better than you in certain disciplines ie marketing, sales etc. You don’t have to hire them full-time to begin with you could take them on three days a week which would be better than nothing.”

Gareth Williams is the founder and managing director of Bristol-based Yellow Dog, which is a platform which harnesses under-used computer power and makes it available to 3D artists and animators. He believes in hiring early. “You’re not going to scale your business as a founding team alone, so it’s imperative you do hire,” he said.

“When you hire depends on cash, how long that cash will last, and how that role will directly contribute to growth? For me, we got investment early to hire early to scale early.”

Sarfaraz Akram is the chief operating officer at Rochdale-based Lancashire Farm Dairies and said: “The decision on when to hire is intrinsically linked to risk; do I invest now and run the risk that new concept doesn’t work, or do I delay and lose first mover advantage?”

Christina Colmer-McHugh is the co-founder and director of start-up Moodbeam, which make wearable mental health wristbands. “We’ve actually just hired our first full-time employee,” she said. “I think there’s always a certain amount of trepidation when it comes to trying to allocate funds for a new member of staff.

Without wishing to sound clichéd but you will know when the time is right. Have the confidence to put it to your management team, investors and board. “We held off as long as we could but now one month in, we don’t know how we did without them! In our case, when our product became market ready we knew we’d need the extra support. For the employee, it’s probably one of the most exciting times to come on board.”

Pippa Adams is the CEO of Chester-based Prodo Digital Marketing and leaves nothing to chance when it comes to recruitment.

“As our business has grown over the last 21 years we have created scorecards that measure predicted fluctuations in work that allows us to predict our resource requirements quite accurately but that took a long time to get to,” she explained.

“Before that there were three key things I looked out for: 1. Do the staff look particularly overstretched, it’s a strong indicator – you need to sanity check that it isn’t an issue with performance, but when good people are looking overstretched it’s time to consider recruiting.

“2. Your customer service is taking a hit, whether this is anecdotal through your customer facing teams, or more formally through NPS surveys – getting to the route of the problem, if it isn’t a process it is often a question of resource and time required with your team.

“3.This one applied particularly in the early days when you simply sat back at the end of the day and realised a lot of the stuff you did could be done by someone with less experience than you – the first hire on this basis is always the leap of faith but it frees you up and ultimately to coin that phrase ‘delegate to elevate’ it will help your business thrive.”

Danny Simpson is the CEO of Rochdale-headquartered MID Communications, the largest independent franchise of Telefonica O2 UK. He said start-ups need to ask themselves a couple of basic questions before the crucial first hire. “Have I got the work and the demand to keep the person busy if I took somebody on?” he said.

“Secondly, does that work potentially have the opportunity to return the investment for the increase in labour cost? “Another good point to think about is if the person you’re going to take on could lighten your load to make you more productive.

“Also don’t think about the annual overall cost of the person think about the monthly cost. This will make it potentially more affordable and more achievable for you to manage rather than looking at the number as a whole. “Finally make sure you think about could the person be an apprentice to come and join the business / team? They are not as costly as the fully skilled person but are eager to learn and are more often very creative and innovative.”