Hire or Train? Things to Consider When Building an All-Star Team
If you’re trying to build an all-star team, is it better to hire new talent or train your existing employees?
Hiring good employees isn’t cheap. According to a recent survey by the Society for Human Resource Management (SHRM), the average cost per hire is $4,129—on top of their salary and benefits package.
From a cost perspective, it’s clear that hiring new employees may not be as effective as training your current population. If you’re in an organization that is looking at hiring new staff, first examine the advantages of developing internal talent.
Training internal talent is cost-effective.
In 2014, companies spent an average of $1,229 per employee on learning, with 32.4 learning hours being used per employee. The math makes a persuasive case for training: it costs nearly $3,000 less to train an existing employee than it does to hire a new one.
If current employees are resistant to complete training, consider offering incentives or rewards like points or badges for completing development activities. Integrate these services with your existing learning management system to make implementation, tracking, and follow-up part of your team management process. Download our Employee Experience Handbook to read more about fostering employee learning and development.
Internal development creates emotional connections.
“When people are financially invested, they want a return. When people are emotionally invested, they want to contribute,” said Simon Sinek.
That type of emotional connection is powerful and more easily achieved when you share a history with employees. When you invest time and money in developing current employees, it builds a sense of trust and an emotional bond with your workforce.
Talent development protects institutional knowledge.
Research shows that it takes 3-5 years to take a seasoned professional and make them fully productive. Don’t let your investment leave! You should do everything you can to keep that employee—and the institutional knowledge they’ve gained—within your organization.
Training investments produce cross-functional skills.
It takes anywhere from 6 months to 2 or 3 years, to onboard a new employee, depending on the role. That’s up to 36 months of time that you could be using to cross-train an existing employee in new skills. Developing current employees provides you with flexibility to assign new roles and responsibilities to those who have specialized skills that can be put to use in various areas.
Internal investments help your company culture thrive.
Providing development opportunities for employees throughout their careers demonstrates organizational commitment to professional and personal growth. In turn, that commitment inspires—and drives—employee engagement. A culture of learning and development is a key factor in creating a healthy company culture.
Most of your existing employees will appreciate training, education, and development opportunities. Before you seek to find new talent for your organization, make sure that you’ve considered all the internal options first. And if you do hire new talent, be prepared to have your internal employees take on the developmental role of training and mentoring your new recruits.