More than 30 percent of hiring managers second guess their new hires. Up to 25 percent of new hires second guess their choice of employer. The results can devastate the profits of a business, reports The Recruiting Roundtable. Just consider that 68 percent of customers and clients stop doing business with a company because an employee shows an attitude of indifference towards them, and the lifetime value of a customer is 300 to 700 times more than an hourly employee’s pay, according to a survey by author Michael LeBoeuf
When it comes to employees, choosing wisely will help you reap the most rewards.
Cultivating a Small Business Culture
Although opportunities for advancement are generally less frequent with small businesses, there are ways to make devoted employees feel like part of a growing business. Even large companies such as Costco can adopt a small business culture that boosts the morale of current employees.
An interview with Jim Sinegal, former CEO of Costco, showed that big companies often work to promote from within because it provides better incentives for longtime employees. Individuals who come from other retail venues are trained for a set time period before obtaining a promotion to a preferred position at Costco. Basically, Costco has enjoyed much of its success because they use a specific formula to cultivate the enthusiasm of their employees while rewarding long-term effort and loyalty.
The Benefits of Promoting From Within
Having a plan to rate and review each employee’s strengths, areas of growth, and leadership potential can make the decision a little easier for professionals looking to hire new employees.
Clay Wyatt of BusinessFinanceStore.com, says that a major benefit of hiring internally is cost reduction. Hiring from within saves the expense of using a recruiting service and advertising the position. The cost of hiring externally is usually much higher, due to the necessary steps a company must take to interest potential employees.
Another benefit of internal hiring is increased employee morale. Employees who feel that they are able to grow with a company are more likely to work efficiently and retain a positive mindset. This increases the productivity of employees as they work on building a career.
Benefits of External Hiring
Although hiring from within is an excellent practice for many reasons, hiring outside the company is a great way to bring in fresh thinking. New ideas brought in by external hires can motivate a stagnant staff, according to Education Week’s Emily Douglas. A new employee is likely to bring creative thoughts to the table, which can lead to more innovation. Streamlining the process with resources like job-applications.com for new hires to apply can also be a big, time-saving help.
Hiring externally may also be necessary when specific qualifications, experience or educational standards are desired. Current employees might not have the experience or education needed for a promotion. Hiring a specifically educated new manager can also help current employees expand their repertoire and business sense.