# “Hiring Smart” is the key to success for entrepreneurs. Here’s how you do it. Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-01-30 Category: BUSINESS Category URL: https://financedigest.com/category/business Meta Title: Why Hiring Smart is Essential for Entrepreneurs Meta Description: Learn the importance of hiring the right people from the start and how it can save resources and maximise your investment in talent. URL: https://financedigest.com/hiring-smart-is-the-key-to-success-for-entrepreneurs-heres-how-you-do-ithtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/istock-1053017876-1736814525053-compressed.jpg) _By **Kashif Aftab,** Founder and CEO of SkillGigs,_ If I were to pick one thing that entrepreneurs need to do to succeed, is to hire the right people from the very start, and be confident in those hiring decisions. This is easier said than done, especially in highly skilled sectors like healthcare and technology, where there’s a major demand for talent—and when a recession is looming, which puts pressure on companies to decrease labor costs. However, the [key is to think about hiring](https://www.financedigest.com/5-key-things-you-need-to-know-before-hiring-your-first-employee.html "5 Key Things You Need to Know Before Hiring Your First Employee") the right people, not more people. Hiring incorrectly, or not assigning the right people to the appropriate roles, is probably the number one reason why entrepreneurs fail to achieve goals and miss benchmarks. When you hire the right people in an efficient manner and allow them to lead in their area of expertise, you [save resources and maximize the valuable investment](https://www.financedigest.com/investing-in-a-first-party-data-strategy-can-save-the-day-for-retailers.html "Investing in a first-party data strategy can save the day for retailers") you have made in their talent. But the question remains: how do you “hire smart?” What is the secret to finding the right person for the right role with minimal [time](https://www.financedigest.com/it-is-time-insurers-act-smart-by-making-legacy-systems-a-thing-of-the-past.html "It is time insurers act smart, by making legacy systems a thing of the past")? It can be overwhelming to think about. The answer, though, is simple, and it lies in a good direct sourcing strategy with the right partner. **Why Hiring Smart is So Important** When you’re first starting up, it’s easy to get caught up in the process and projects you are [trying to complete and not focus on the people and skill sets you would actually need](https://www.financedigest.com/what-needs-to-happen-to-improve-the-landscape-for-smes-trying-to-access-finance-options-in-the-uk.html "What needs to happen to improve the landscape for SMEs trying to access finance options in the UK") to get this work done until much later in the process. But the recent mass layoffs at larger companies like Meta and Google demonstrate that [hiring large amounts of top talent](https://www.financedigest.com/5-steps-hiring-top-talent-youre-just-start.html "5 steps to hiring top talent when you’re just a start-up ") is not always the best approach. While these [businesses are now big](https://www.financedigest.com/smishing-is-a-new-virus-plaguing-big-business-conversational-commerce-to-the-rescue.html "‘Smishing’ is a new ‘virus’ plaguing big business – Conversational Commerce to the rescue!") enough to keep going amid major economic headwinds, this “hire first, figure out the exact demands of the job later” approach could mean financial ruin for a smaller company or startup. **[Entrepreneurs need](https://www.financedigest.com/10-secrets-every-entrepreneur-needs-to-thrive-in-2023.html "10 Secrets Every Entrepreneur Needs to Thrive in 2023") to flip this script.** People are your most significant investment, and the availability of talent should be factored in much earlier in your business strategy. Hiring is expensive, but hiring smart is better for your [bottom line](https://www.financedigest.com/the-severe-impact-of-downtime-on-companies-bottom-lines.html "The severe impact of downtime on companies’ bottom lines"). To help illustrate this, think about the cost involved with hiring any worker, whether they are a contractor or a full-time employee. The first is recruiting costs. The average mid-sized [company works](https://www.financedigest.com/alone-together-how-to-maintain-a-positive-company-culture-while-working-remotely.html "Alone together: How to maintain a positive company culture while working remotely") with at least 12 different staffing vendors, according to Avature, to get the talent they need when they need it. If any of these traditional [staffing firms manage to fill](https://www.financedigest.com/uk-firms-plan-biggest-pay-rises-since-2012-to-fill-staff-gaps.html "UK firms plan biggest pay rises since 2012 to fill staff gaps") your position with a candidate in a timely fashion (which only happens a fraction of the time), the majority of recruiters charge between 15% and 25% of the candidate’s total first-year annual earnings. Then, there’s the cost of onboarding and training, which means valuable time spent away from actual projects while you bring the new worker up to speed. Add in the actual compensation, which may include benefits beyond monetary pay. According to experts with the Society for [Human Resource Management](https://www.financedigest.com/the-importance-of-strategic-human-resource-management.html "The Importance of Strategic Human Resource Management") (SHRM), the total cost of hiring a new worker can be up to 3 to 4 times that person’s salary on paper. All that money goes down the drain if the person you’ve [hired does not work out for any reason](https://www.financedigest.com/reasons-why-you-should-hire-a-business-broker-to-sell-your-business.html "Reasons Why You Should Hire a Business Broker to Sell Your Business"). Many times, this is because the employer did not adequately understand the skills [needed to complete the project](https://www.financedigest.com/why-do-projects-need-an-ieo.html "Why do projects need an IEO?"), and hired the wrong person. **How to Hire the Right People the First Time** So, what is a smart hire? A smart hire is someone who is well-aligned with the actual hard (technical) _and_ soft (i.e. managing people) skills you need to get the job done. They have a clear understanding of what their [market value](https://www.financedigest.com/dental-3d-printing-market-to-reach-an-estimated-value-of-us-2-9-bn-by-2031.html "Dental 3D Printing Market to Reach an Estimated Value of US$ 2.9 Bn by 2031") is, based on their experience, and what their actual compensation will be at your company. Finally, of course, they have to be looking for the type of position you’re offering (project/contract v. full-time, etc.) Of course, nobody can predict the future or perfectly understand exactly what [skills a project will require](https://www.financedigest.com/lack-of-collaboration-and-skills-shortage-is-limiting-organisations-ability-to-meet-ifrs-9-requirements.html "Lack of collaboration and skills shortage is limiting organisations’ ability to meet IFRS 9 requirements") until you begin. Google, Meta and other large companies tried to get around this issue by hiring large numbers of people…who were then let go as soon as things got rocky financially. Entrepreneurs behind startups and smaller companies don’t have this bandwidth—and the good news is that you don’t need to [hire a large volume of people to get things](https://www.financedigest.com/car-hire-for-smes-things-to-consider.html "Car hire for SMEs: Things to consider") done, you just need to hire the right people the first time. The key is understanding exactly the skill [set and level needed for a particular project or role](https://www.financedigest.com/negotiating-our-future-youth-set-to-grab-power-roles-at-cop27.html "‘Negotiating our future’: Youth set to grab power roles at COP27"), know the market value of those skills and then plan the projects and strategy accordingly. This can be uncomfortable, as it may show you that the talent in your [market simply does not have the skills](https://www.financedigest.com/how-to-market-your-freelance-skills.html "How to market your freelance skills") required, and you may have to expand your search to include remote talent, or you may realize that some projects may need to be reprioritized. However, the advantage that entrepreneurs have is that they can pivot much more quickly than a larger company. This will help you build your business on the right people, which keeps you from having to constantly spend on rehiring to [fill talent gaps](https://www.financedigest.com/analysis-energy-hungry-europe-cant-look-to-u-s-shale-to-fill-any-opec-gap.html "Analysis-Energy hungry Europe can’t look to U.S. shale to fill any OPEC gap"). **The point is to develop a skill density requirement, not just a [job description when you list an open](https://www.financedigest.com/dollar-dips-as-job-openings-fall-fed-meeting-in-focus.html "Dollar dips as job openings fall, Fed meeting in focus") position.** When you assess the gaps on your team, what are all of the required skills and how do they rank? [Focus your hiring on the critical skills needed](https://www.financedigest.com/high-street-crisis-why-retailers-need-to-focus-on-in-store-ux.html "High Street Crisis: Why Retailers Need to Focus on In-Store UX") and determine what can be trained after the fact. If, for example, you have a product [moving toward](https://www.financedigest.com/investment-advice-moving-towards-a-new-model.html "Investment advice – moving towards a new model") the launch phase, you might determine that, out of all the skills needed for it, a scrum master project manager is the most necessary. The right **direct sourcing** partner can help you do all of this. Direct sourcing refers to a [hiring process](https://www.financedigest.com/three-ways-that-female-entrepreneurs-can-supercharge-their-hiring-process.html "Three ways that female entrepreneurs can supercharge their hiring process") in which employers directly engage with job candidates in a transparent, efficient manner. Instead of working with a third-party recruiting firm, for example, employers working with SkillGigs have access to a large, engaged, pre-screened and constantly refreshed pool of talent who have been AI-matched to your job openings based on a cutting-edge skill profile (built with our patent-pending 3D Resume technology). By the time you interact with them as an employer, they have _already_ indicated whether or not they are interested in your position. From there, [employers can see](https://www.financedigest.com/uk-employers-see-slight-fall-in-pay-awards-over-2023-xperthr.html "UK employers see slight fall in pay awards over 2023 – XpertHR") accurate data about what a good market compensation rate would be for them, and submit a pay bid to them directly, shortening the interview process and cutting right to the chase. The difference between a direct sourcing talent platform like SkillGigs and a traditional job [board is that the former](https://www.financedigest.com/shareholder-group-iss-backs-barclays-board-over-former-ceo-staley.html "Shareholder group ISS backs Barclays board over former CEO Staley") is built on the principle of smart matching, and bases all matches on skill concentration. The right direct sourcing partner will help you [build a skill density requirement](https://www.financedigest.com/whats-required-of-accounting-to-build-a-better-tomorrow.html "What’s required of Accounting to build a better tomorrow") for every position, and use AI to assess every job candidate’s personal experience with that skill before even presenting them with the job opening. This [saves everyone time](https://www.financedigest.com/how-to-use-algorithms-to-save-time-and-make-money-when-trading-currency-crypto-shares-etc.html "How to use algorithms to save time and make money when trading (currency, crypto, shares etc)"), costs up to 35% less than a traditional recruiting firm, and leads to smarter hires. Entrepreneurs have to move fast. It’s easy to get caught up in the process of planning a product or project, and lose sight of the importance of [people until the very end](https://www.financedigest.com/5-common-ways-people-end-up-in-debt-without-realising.html "5 Common Ways People End Up In Debt Without Realising"). However, hiring the right people from the start will help [ensure your success](https://www.financedigest.com/strategic-budgeting-ensures-success-of-community-support-programs.html "Strategic Budgeting Ensures Success of Community Support Programs") in both the short and long-term—and it’s something you can do with the right direct sourcing partner. **_![](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/132-1736814524977-compressed.jpg)_** **_About Author:_** _Kashif Aftab is the Founder and CEO of SkillGigs, an ecommerce talent marketplace that pairs [skilled healthcare and technology](https://www.financedigest.com/navigating-the-global-technology-skills-gap-with-ai-moderated-upskilling.html "Navigating the Global Technology Skills Gap with AI-Moderated Upskilling") job seekers with AI-matched work opportunities._ --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---