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Build vs Buy: Grow your employees or hire ready-made talent?

Posted by Chad O'Connor  February 26, 2014 06:00 AM

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My entire career has been spent helping tiny companies to grow rapidly. In these hyper-growth environments, one of the first things you learn is that the 10 people who start with a company will not always be there when its headcount reaches 210 or 510 people. This includes some members of the leadership team. And that is okay.

The challenge, then, comes down to a company's philosophical views on hiring, development and retention. In my experience, companies need to both build employees from within and buy strategic talent in order to strike the right balance.

When it comes to talent acquisition, companies need to think long term, beginning by probing each candidate’s aptitude for future growth early in the interview process. If a company's primary consideration in hiring is to fill an open position, it may end up with a person who has a fantastic skill set now, but isn't capable of growing with the organization. If the focus is growth potential, however, the organization will build a talent base that is better suited to scale.

When it comes to development, it's a two way street. Employees need to take initiative to propel their careers forward, and companies need to make an investment in those individuals. It's unfair to sell career growth if internal candidates aren’t being promoted or do not have a clear understanding of how to get to the next level.

In high growth environments, companies must diligently plan for the future, anticipating how they will grow and mature. Even the best early-stage people may not be able to keep pace with their rapidly expanding roles. The practice of handing out inflated titles to young workers, who join early but have little more to offer than their youthful enthusiasm and work ethic, only complicates matters further. Their lack of experience can become a liability when things really take off. Bringing more seasoned players into the mix becomes a necessity, but also requires an ego dance. Careful planning for company and individual growth not only sets appropriate expectations, it allows a balance of internal growth and the inevitable supplemental "buy" from the outside.

Retention also hinges on a balanced talent dynamic. If a company's current team does not feel like they have the ability to grow and develop internally, they will ultimately leave for a company who will invest in them. Along with those departures go the company's tribal knowledge, culture and growth story, key assets for attracting others to the firm. This makes things far more difficult when the company is forced to hire a bulk of its talent from the outside.

So it becomes clear that success at high-growth companies is all about balance. It is critical to understand and nurture both current and future employees in order to build a team of people who can be successful both today and tomorrow. Careful planning to ensure a company hires well, develops thoughtfully and is mindful about employee turnover is essential. Once employee trust is earned, blending in critical hires from the outside to fill skills gaps on teams will be considered savvy, and met with far less pushback.

Christina Luconi is Chief People Officer of Rapid7.

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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