A Delicate Proposition
Finance executives may well feel that there are two very good reasons not to hire in the current economy: perception and reality. The near-universal need to contain or cut costs furnishes the reality. The perception problem has more to do with a gut feeling that the time simply isn’t right, and with fears that the company will look bad if it hires at the same time that it’s laying off workers. Kilgore says companies need to get over such fears. “It can sound cutthroat to lay off 12 to 14 percent of your workforce, rather than 10 percent, in order to free up resources to make some key hires,” he says, “but you need to do that to get ahead of the curve.” Kilgore says he once worked for a Fortune 100 company that hired 3,000 workers even as its massive layoffs made front-page news.
Still, Kilgore and others caution that companies need to hire carefully, for a variety of reasons. First and foremost, hiring the wrong person is always a costly mistake, and wider availability of talent does not guarantee that you will hire the right one. “The real talent does not get laid off as readily as other staffers,” says Lynne Morton, founder and principal of Performance Improvement Solutions, a talent and change management consultancy. “They also tend to know their value, so you need to avoid haste and you need to resist believing that you can bargain-hunt.”
As Bronson of PSS surveys the field, he notices that entry-level employees seem well qualified, but adds, “what I see less of today than I did 8 to 10 years ago are people with the skills and competencies to run a business. The ability to see around corners, plan for contingencies, and balance priorities such as customer satisfaction with profitability, those are the qualities in shorter supply. When I see them, I snap them up.”
Perhaps the most challenging aspect of hiring in a recession, particularly at a company that is reducing its workforce, is striking a balance between boldness and prudence. On the one hand, “you should move now,” Kilgore says, “because if you wait to hire you’ll be competing with every other company that waited until conditions improved, which means you’ll have to act more hastily and risk an overall decline in the quality of talent available.”
On the other hand, companies looking to add staff have to be judicious as well. One technique that may help is to add additional levels of approval to any hire; it may slow the process, but it increases the degree of vetting and helps ensure that new hires pass muster and are truly needed, rather than simply filling an open slot.
Approaching talent acquisition with a longer-term view can also help management teams determine how much hiring they should aim to do now. “Investing in talent is like investing in undervalued stocks,” says Kirk Hallowell, principal of MatchPoint Coaching. “It all comes down to your time horizon. If you’re looking several quarters out, now is a phenomenal time to acquire the talent you need.” The companies most able to do that are those that have developed high-level talent-management plans that complement the company’s overall strategic plan. “Design the org chart that you’ll need to get where you want to go,” Kilgore says. “Then look to fill the gaps,” and, where necessary, cull the surpluses.