Hiring is not (always) the solution

As a founder, I've had countless conversations with customers and business owners from every sector. A common narrative emerges from these discussions: businesses are growing rapidly and their default response is to expand their teams. 

I challenge that instinct and explore in this essay why automation and process optimization, not just team expansion, are key to sustainable growth.

Yay! We're growing!

In the business world, expanding the team is often seen as the first solution to growth challenges. There's a psychological comfort in seeing a growing workforce: it's a tangible sign of progress and expansion. 

At Tadabase, we’ve been there multiple times. We hit new highs and instinctively went on to hire some great folks with much excitement. But more often than not, we found that while growing our team felt good and looked good, it rarely served as a wholesome and sustainable solution to our growth challenges.

The most common question people ask in reference to a company's status is, “How many employees are on the team?” This is a question that is supposed to be a tangible indication of how well a company is doing. Yet, more often than not, I find that team size does not necessarily reflect a truthful index of company productivity and growth.

There are certainly times when hiring is the absolute best option. If you need another nurse in your clinic or another carpenter for your construction business- increasing specialized skill to meet growing demand is a no brainer. But when hiring is the instinctive response to managing the daily processes and tasks that keep a growing business running, this is where I challenge the reflexive decision to hire more people to manage the work rather than streamlining the processes to simply run better on their own.

Software doesn't clock out at 5pm

There's a natural inclination to prefer human oversight. People can take ownership, and it's easier to hold someone accountable rather than a software system. But what I'm surprised that people don't consider more often is that people need to be held accountable for a reason. Human error, timeliness, laziness, and a million other reasons that make us human. Software doesn't clock out at 5pm. Generally, you set up your automations, and it's set it and forget it.

It's a gamble

What's most intriguing is the ease with which businesses gamble on new hires but not new software.

There's no question that every new hire is a gamble. No matter how stellar the resume or references, no matter how many rounds of interviews you conduct, no matter how well the candidate seems to be a "perfect fit"... you never really know how your new employee will work out on day 1, day 30, and certainly not in the long run.

Cultural misfit, work ethic, career changes, value misalignment, personal circumstances, etc. There are a million reasons why a new hire may not pan out. Unfortunately, this is usually discovered only after tremendous time and money are already spent on company onboarding and training resources, and not to mention the thousands of dollars already spent on salary and benefits.

While a new software can certainly be a gamble as well, a monthly subscription service like Tadabase that costs about $250/month is nowhere near as risky as the potential and often inevitable costs of a disappointing hire.

Additionally, whereas a successful (for the time being) hire can help reduce the workload of a growing business, a successfully implemented software can automate the workload, thereby making that new hire, and many other new hires, unnecessary to begin with.

Whereas the new hire can come and go, a successful software that streamlines your workload and scales with your growing business will be there to stay, eliminating the need for unnecessary salaries and making software a much wiser investment.

Mmmkay

While executives are generally better at hiring and hire based on real necessity, some managers hire for a number of unnecessary reasons.

• Managers need people to manage - doing the work is hard, managing is manage-able. MM-kayy? Unfortunately, some managers fall into the trap of hiring new employees to do the work for managers to manage.

• Managers like when people take ownership - as mentioned previously, it's easier to hold a person accountable rather than a software.

• Perceived complexity - this is the most common claim I hear from managers and business owners. Many businesses think that their processes are too complex for software and so their only solution for growth is team expansion. However, most of the time, in one brief demo, I'm able to demonstrate how each business is a perfect candidate for software automation and process streamlining.

Hire or automate?

As businesses grow, the instinct to expand the team is understandable, but not always optimal. My perspective is to pause and ask why. Why do you need to hire someone? Is another employee the optimal solution or simply the most common response? Can the position be eliminated entirely by simply automating the work?

Some questions I ask prior to making a hire:
1) Why do we need this hire? (A feel good response or truly necessary?)
2) Are the roles and responsibility clearly defined?
3) Are the success indicators clear to everyone?
4) Can this role be eliminated with automation?

Here's an example that I've recently witnessed with a customer of Tadabase.

A medical supplies company selling to large healthcare agencies was dealing with incredible growth. They took over as the primary distributer for an additional 78 facilities and had to navigate the influx of clients requests. When an audit came around, the requests for sales data was overwhelming the team. While on a call with the CEO, he mentioned to me that the company is in the process of onboarding an additional two back-office employees to deal with the influx of requests.

We broke down the questions:

1. We need to hire a new role because we're overwhelemed with requests for historical data.
2. This person would be responsible to address and gather all the past invoices and data per client.
3. If all requests for data are responded to within 1 business day, then this person is doing a great job.

4. And for the magic question: can this role be eliminated with software? Indeed!

This is a perfect example of something software can do better. Instead of hiring additional team members, adding functionality to the existing data for the clients was a no-brainer.

Within a few days, a new portal was added and the clients enjoyed having the self-help portal to view and download their own data. This soon turned into a benefit the clients enjoyed over the competition.

The cost to implement these portals was under $3,000. That's 1/5 of what a recruiter would have cost the company on a gamble hire.

It's a new era

When traditional CEOs envision creating a portal, they often imagine a scenario where a team of developers is tirelessly working, costs are spiraling out of control, and the desired results remain elusive. They recall past projects that held promise but never quite made it into production due to shifting business dynamics or unexpected outcomes.

In today's world, the real magic lies in having individuals with a strong business acumen take the reins in building complex applications. This individual, whoever they may be, should be your next hiring priority. They need to possess a deep understanding of your business, enabling them to adapt swiftly to any changes that arise. Before adding more personnel to your team, consult with them to determine if the role can be automated and streamlined to protect your profit margins.