I’ve hired and fired a lot of people, and the best thing I’ve learned along the way is to hire the people you can’t afford.
Crazy, right? It's true. I’d rather have one or two awesome, motivated, smart employees than five average, mediocre ones any day.
Yeah, yeah, yeah, I hear you. You need five people—you can’t afford to get by with three. But I'm telling you that you can. You just have to find the right three. If you can’t pay them in cold hard cash, offer them something else you can live with—stock options, flextime, an office, free lunches. Work it out. Show them what you have to offer now and what you can promise them in the future, whether it’s bonuses or a title, more power, the ability to create their own job or whatever. A great employee who's willing to put some skin in the game, as they say, is an employee more likely to be loyal and committed. The longer an employee stays around, the less they cost in terms of hiring, replacement and training, too.
Great people know what they want. They don’t waste time taking a job for a paycheck. They’re motivated and bring more value to the table. Expecting a $20,000 car to perform like a $50,000 car is insane, but for some reason when it comes to employees, that's what we think. You're not going to get the same quality work out of a minimum wage guy as you are a management quality guy. You need to hire for the highest position you think that person will ever attain in your company.
If you pick wrong, it hurts, but you can get rid of them and learn from your mistakes. However, if you pick right, you’ve made a huge investment that will pay off over and over again. Plus, when you get used to hiring the best, you’ll learn to spot top-quality candidates immediately.
Still don't believe me? These five reasons should help you see the benefits of hiring an employee you think you can't afford:
Productivity jumps. When you add talent to your team, everyone else’s productivity increases because you’ve just raised the bar. If you raise the bar and people react negatively, slow down work or otherwise try to sabotage your new hire, you’ve just learned something else important—who your loyal employees are not.
Potential and expansion. Talented people can be promoted, trained and cross-trained. They can move up through the ranks or into other, more challenging positions. Average people are only placeholders, doing a job until they find something else or until someone comes along who's better at it than they are.
Lower HR costs. You can get by with fewer people (and their assorted costs, like healthcare, training, benefits, software licenses, parking spots, payroll processing, and all the little stuff that makes new hires expensive) if those people are talented, bright, motivated and better. That means you can afford to hire the best because you don’t need 10 average people. You only need three to five bright, talented ones.
Investing. You’re investing in your company, not merely plugging an empty hole with a warm body. Talented people tend to see the company they work for as an investment in themselves too. As a result, they’re more likely to stay, work hard, be loyal and advance through the ranks than a clock puncher would.
Iron sharpens iron. Not only will brighter, smarter people be good for your company, they’ll be good for you. They’ll tend to push you to be better. They’ll bring you more ideas, more involvement and more passion. They’ll improve your game and the games of those around them.
You can’t not afford to not afford great people. Hire the ones you think you can’t afford and you’ll quickly realize how affordable they really are.
Looking for more hiring tips? Check out all our articles about hiring.
Mike Michalowicz is the co-founder of Provendus Group, a business growth consulting group that helps companies whose growth has plateaued to grow again (and fast). Michalowicz is the author of The Pumpkin Plan and the business cult classic, The Toilet Paper Entrepreneur.
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