As a leader, you’re a visionary. You may use terms like “cat-herder,” “jack-of-all-trades,” and “superstar” to describe yourself. However, just because you can accomplish practically any and every function necessary for the continued operation of your emerging enterprise, that doesn’t mean you should.
Ideally, leaders should spend the bulk of their time and energy doing that which only they can do: encouraging and supporting the growth of their business. All too often, however, the brunt of everyday administrative responsibilities like bookkeeping, scheduling, social media, and website maintenance falls squarely on the leader’s shoulders. That’s especially true in a startup or rapidly growing business.
What you need is help, a righthand (wo)man who can help you scale. But what can you do if hiring someone to fill that role just isn’t feasible yet?
Internal Hires Are a Better Bet Than External Ones
This is a common catch-22 that most small business leaders find themselves facing. Growth means you have to hire help to get everything done, but you haven’t grown enough to afford to make any additional hires just yet. What’s a leader to do?
The answer: Focus on developing the talent you already have in house. This strategy can be a saving grace for many small businesses.
In fact, a workplace study by Wharton management professor Matthew Bidwell found that external hires are often the least effective choice for companies. According to Bidwell’s research, external hires, on average, receive significantly lower performance evaluations during their first two years on the job than their internal counterparts do. Additionally, external hires are more likely to leave the organization. To top it all off, external hires are typically paid 18-20 percent more than internal hires promoted into similar roles.
When a company makes an external hire, it can end up paying more money for worse performance. That’s why it pays to look to your current staff to uncover hidden talent.
Promoting from within strengthens your existing culture by rewarding employees for their loyalty, encouraging further investment and engagement by showing all workers that there are paths for career advancement in your company. It also creates smoother transitions — internal hires are already acclimated to your culture and norms — and preserves institutional knowledge.
How to Figure Out Who’s Ready for More
As a leader, you know your employees. You know their strengths, their weaknesses, their passions, and their ambitions. (If you don’t, you really should. Seriously. In fact, I suggest you go do that now before you do anything else.)
Now — and only now — are you ready to consider which of your workers are ready to be promoted. Focus on the following checklist to find hidden talent in your ranks:
1. Their Bases Are Always Covered
Employees who consistently do their work, produce expected deliverables, and complete core tasks satisfactorily are employees who can likely be trusted with additional responsibility.
2. They Have a Career Vision
When you ask the employee where they want to be in five years, they have a clear answer for the kind of work they aspire to do — and why they aspire to do it.
3. They’re in High Demand Among Their Colleagues
Other teams are always requesting this employee’s help, input, or time. That’s a surefire sign the employee knows what they’re doing — and that other employees already trust them as an authority.
4. Their Performance Passes the Test
The employee doesn’t just do what they’re supposed to — they have a proven track record of exceeding expectations and a long history of continuously striving to improve.
5. They Are Full of Ideas
The employee always seems to have a new perspective, a fresh idea, or a novel insight. This is a good indicator that the employee is enthusiastic about what they do, and they’ll bring that enthusiasm to a new role.
6. They Live to Learn and Grow
The employee is actively and personally invested in their career. They subscribe to industry journals, belong to professional associations, and attend career-focused groups in their free time.
7. They Shine Under Pressure
The employee runs to problems, challenges, and obstacles. They have never encountered a challenge they couldn’t handle.
Think of your existing human capital as invaluable pieces of a chess game: You just need to be strategic in placing the right people in the right places to maximize their potential. When you know what to look for — those diamonds in the not-so rough — your business will experience a windfall as you boost morale and strengthen culture.
And that? That’s priceless.
Tricia Sciortino is CEO of BELAY.