A recent study shows that time-to-hire is increasing significantly for almost all roles globally. But what does this mean for any startup company? Before diving deep into this, let’s understand what time-to-hire is.
Time-to-hire indicates the efficiency of the recruitment process and offers a realistic view of the time it will take to find a replacement for an employee. According to Robert Half, 57% of job seekers lose interest in a job if the hiring process is lengthy.
So how important it is for you to hire effectively?
Hiring the right team is crucial for any startup as it directly impacts the culture of the company, their productivity, and their long-term success. The hiring process can be time-consuming and complex, especially for those founders who juggle multiple roles and responsibilities.
Below are some compelling statistics that emphasize the importance of hiring effectively:
On average, it takes 44 days to fill a job opening (AMS).
Candidates drop out of the process mostly because they have been counter offered or have lost their interest in the job due to slow time-to-hire.
Professional services firms take average time-to-hire at 47 days, while tech roles across industries remain extremely challenging.
If we even hire effectively, how much involvement of a founder in the hiring process can impact their startups?
While these numbers can vary depending on the roles and open positions and the founders’ involvement, the facts can’t be ignored. The time wasted on manual hiring processes by the founders can have dire consequences on their startups:
Slowed growth: An inefficient hiring process can delay the onboarding of new team members, which will eventually lead to missed opportunities in a competitive market and hinder the startup’s scaleup.
Opportunity Cost: The time spent on hiring tasks is not time spent on strategic activities like developing a new product/service, securing funding, building partnerships, or improving internal processes.
Reduced Quality of hires: By not leveraging the right resources, founders may overlook optimal hiring decisions. A subpar team can result in decreased productivity, poor collaboration, and lack of innovation.
Founder Burnout: Hiring processes can add to the already overwhelming workload of founders, increasing their risk of burnout leading to poor decision-making, strained relationships within the company and ultimately, a startup’s failure.
Increased Costs: A longer time-to-hire results in increased costs which can cause a loss in productivity and the need for additional resources to manage internal/external processes in a startup.
To keep your startup on track and further accelerate your product development journey, you can follow these tips:
Focus on hiring the strategic/key team members: Hire CTO etc. They will play a critical role in both successful and unsuccessful product development. A CTO is a key adhesive that brings the business and technology teams together and hence it is important to hire a person with just the right mix of technical and business acumen along with a good general sense of empathy and well-being. After all, this person will be taking most of the pressure from the business whilst buffering the development teams working for him.
Clearly defined product requirement and roadmap: As the founder of a start-up most people have grandiose ideas of changing the ways things are done, if not inventing a completely new way of doing something! And while it is good to have grandiose ideas of changing the world, it gets investors excited and helps raise your company profile and valuation. When it comes to product development. Being CLEAR, PRACTICAL and REALISTIC is key to hiring the right team and keeping them on track. When hiring, engineers buy into a dream, they buy the idea that they will build something to bring change. However, lack of clarity and constant change in direction can quickly lead to frustration and question the overall capability of the leaders, charged with building the idea.
Bring onboard an outsourced software development partner: Having put your key team together. It is now time to decide whether to keep the product development in-house or outsource it to a trusted and capable partner. There is no simple answer to this question. But let me lay down the pros and cons of outsourcing.
PROS:
You can agree on a fixed price for your product delivery. Mitigating cost overruns.
You practically eliminate the time to start development, leveraging the readily available engineering team of the partner.
You can continue focusing on the strategic parts of your business, including fundraising, partnerships, and marketing with an oversight on product development.
You also eliminate the cost and risk associated with hiring and terminating the wrong hires (this will happen, regardless of how robust your hiring process is).
You can always choose to keep the development of your core IP within your team while outsourcing third-party integrations and other ancillary features of the product.
CONS:
Choosing the wrong outsourced software development partner is a killer, to begin with. Unusually cheap prices, lack of communication, and no local presence are some of the red flags to look out for.
If you don’t sign off a clear requirements document before commencing work, you will quickly start seeing scope creeps and cost escalations. Not to mention the increasing tension in the relationship with your partner.
Cultural differences, even if subtle, can play their part in adding little complexities to seemingly simple communication. Setting and managing expectations also vary in different cultures. However, a daily standup call and a good, up-to-date JIRA board should help mitigate these differences.
You will be relying on the expertise and professionalism of your partner to deliver your product on time and with the expected standard of quality. Here again, daily stand-up calls and a good JIRA board will help you identify any issues and delays early on.
As a start-up founder, our idea is our baby, our most prized possession. However, when it comes to product development, we must keep our emotions aside and consider the money in hand, available technical expertise, and the time to market to decide the direction we take. There is no right or wrong in hiring in-house or outsourcing product development.
Afterall, "Winning should be at the heart of every strategy." as said by A.G. Lafley & Roger L. Martin in their book Playing to Win: How Strategy Really Works.
Contact us today or have a chat with Sargam, if you’re still contemplating your product development strategy and would like to get an expert opinion on the best way forward to transform your idea into reality.
