Should Small to Mid-size Businesses Hire Externally?
Small to midsize businesses are rampant across the nation with startups emerging on every corner. This is great for the market, great for job boards, and great for those looking to leave their Fortune 500 company with 10,000 employees for a more intimate work environment. As these small to midsize businesses grow, they’re faced with the question of whether or not they should hire within for new positions or externally. Recently, our Director of Marketing, Rena Saltsman had the opportunity to speak with Zach Chertok from Aberdeen to discuss his influence on the subject. Chertok is a Research Analyst who specializes in Human Capital Management, so his insights are critical as businesses change and grow.
Should Small to Midsize Businesses Hire Externally?
Yes! Small to midsize businesses should hire externally to encourage growth company wide before they begin placing their own employees into new positions, leaving the old unfilled. This is especially so with startups as most of the current employees have been with the company since the beginning. While this is great for retention rates, it can lead to overlooked issues and needed change. Forbes writes that “organizations that only hire from within run the risk of becoming myopic, unable to see beyond themselves. Maybe you’ve found success in the methods that have gotten you to this point with a team you ‘know.’ The systems and strategies that pave the way to your current success will not necessarily lead to further growth.” Change is needed and incredibly necessary, especially in small businesses if they want to keep up with the changing tides of the business world. This is essential to keep a company from becoming stale or stagnate. With new eyes in the company, it allows for needed change to be recognized. Especially if this new-hire has years of experience and is full of ideas. However, this is not to say that hiring externally is the way to go permanently or the primary way to think about hiring.
As businesses grow, so too do their budgets and spending abilities. Aberdeen is seeing trends that point to companies developing and building their staff to fill open positions internally. As small to mid sized companies cannot always do this - the seed needs to be planted now and this idea needs to stay top of mind as they grow and scale over the years.
“More than 80% of firms are not making significant investments in their internal learning and development environments to revitalize career pathing that was killed off in the 1980’s.” - Aberdeen Research
Why does this matter?
In the increasingly difficult hiring market, barriers are being revealed. Candidates are not just looking for a job, they are looking for a different kind of environment to dedicate their time to. This is where companies need to realize that internal development is important, not only for retaining quality, but for hiring quality. Today’s modern day candidate is approaching the market differently. Traditional questions that a candidate asks oneself when looking for a job are becoming obsolete. For example, the question “does my experience meet the requirements?” is not core to why someone applies for a position. Instead, they are applying with the question, “Can I grow here?” or “Will I make a difference?” According to Gallup Research, “High-quality candidates are attracted to jobs that offer challenges and opportunities to make a difference to others. These candidates say they enjoy intellectual or creative challenges.” No matter where you company is at, it is time to start thinking differently about your approach to hiring.
What Does Zach Chertok Have to Say?
When asked about the expansion of small to midsize business and external hiring, Zach Chertok had this to say (not direct quotes): Yes, small to mid sized companies will most likely hire externally if they are in growth mode. BUT as they grow, they need to "plant the seeds now" and "keep this top of mind" that developing and building into their employees to elevate and fill positions from within is what they should do in the future. When hiring, companies need to have a good sense of tracking employee behavior within and tracking what the market is doing to gain competitive advantage for hiring.
The KEY
Alright, so let’s step back and look at everything we discussed. We know that SMB’s are most likely going to hire externally, BUT if they do, they need to start building at their core a culture where employees are built up and developed. As Chertok stated, this idea needs to be “top of mind”. Providing an environment where employees can grow and develop will radiate and attract quality naturally.
How can ApplicantOne SOURCE Help?
If you’re unfamiliar with what we do at ApplicantOne, here’s a quick refresher! We started as a start-up and now live in the SMB space. Based in Lakeland, Florida, we have a strong focus in staffing needs and have built three services around finding SMB’s top quality candidates all over the country. At the core of what we do is SOURCE, a tool for companies to use to find great candidates to potentially hire on at their company. This tool uses our own ATS or Applicant Tracking System as well as a trained Recruiter to create a user-friendly dossier with resumes, one-way video interviews, recruiter notes, and more all at the palm of your hand for easy hiring. This is a great tool for businesses to use to help hire externally to allow for potential internal growth! Recently we have added to our services because we learned that SOURCE is not a one fits all tool. Read more HERE, to learn about SOURCE and ApplicantOne’s NEW services.