It has long been said that you have to spend money to make money. We invest in education to increase knowledge, improve skills, and make ourselves more marketable, improving opportunities for jobs, advancement, and earnings. We put money into portfolios of stocks and bonds to increase earnings through interest so that we can comfortably retire one day. These things have a cost, but the high likelihood of increasing returns is what makes them a valuable investment.
When it comes to filling top-level positions at your company, you’re going to find that it not only pays to hire the right candidates, but to do so expeditiously. Naturally, filling a top-level executive or upper management position is a delicate endeavor. This person has a lot of responsibilities and plays a leadership role, so you need to make sure he/she has the qualities and skills required for the position.
There’s certainly something to be said for being choosy when filling these pivotal roles in your company, but that doesn’t necessarily mean you should take too much time deciding. When you wait too long to hire for key positions, your company could suffer some serious setbacks and losses in the process.
Even though there is a cost associated with hiring a recruiting company to assist you in finding candidates for high-level positions, you’re better served to view this partnership as a valuable investment. A dedicated, professional recruiter can help you find the right people quickly and efficiently, saving you time and money in the long run. If you’re worried about the “cost”, you first need to consider the price you’ll pay when you fail to hire top-level staff for an extended period of time.
The Cost of a Missed Opportunity
Top-level executives don’t get where they are by failing. The vast majority have worked their way to the top through ingenuity, tenacity, leadership, and large-scale successes. This means they tend to be in high demand. If you’re not on the ball, you could miss your opportunity to land a big fish, so to speak.
Naturally, you want to vet candidates before hiring. You don’t want to jump the gun and end up with someone who is not actually qualified for the position or who simply isn’t a good fit for your company. That said, you can’t draw out the process to a degree that your company suffers undue harm in the process.
This is why having a reliable and qualified recruiting partner is so essential. This person can pinpoint and feed you appropriate candidates much more quickly than you can find them on your own, helping to speed the process and ensure immediate results and long-term success. If you are looking for a recruiter, check out our services.
Impact of Vacancies on Company Finances
Sure, you won’t have to pay a hefty salary for a while, but there is a financial downside to vacant executive positions that could more than offset this temporary boon. In 2016, the Society for Human Resource Management (SHRM) reported that the average time it takes to fill a vacant position is 42 days and the average cost-per-hire is $4,129. Of course, this is just an average. When you’re hiring for an upper management or executive position, the costs and timetable are likely to be far more significant.
How can you determine how much you’re losing financially as top positions remain unfilled? You can use cost of vacancy calculations/formulas to figure it out. They may include fields like salary, working days per year, and the time it takes to fill a vacancy, just for example.
A Harvard University study found that an employee generates revenue or value at 1-3 times his/her salary, depending on the position. This information can be used to create a simple formula for determining financial loss when a position goes unfilled.
Suppose an executive position includes a salary of $200,000 and 230 working days per year. This high-level position probably infers the top value multiplier of three. If the position goes unfilled for the 42 days SHRM cites as average, the cost to the company is $109,565. Add another month to that equation and the cost jumps to $187,826.
Within just a couple of months, your company has lost the value of nearly an entire year of salary for the position. This is the tipping point at which you stop saving on salary and start losing big time on potential revenue and value, and it is compounded by the fact that you’re simultaneously shifting unfulfilled duties to other employees, disrupting their productivity and morale in the process.
Impact of Vacancies on Remaining Staff
When someone leaves the company, their workload doesn’t vanish with them, and it can only be put on hold for so long before it starts to impact planning and forecasting. Invariably, the workload, or at least certain responsibilities, will have to be shifted to other employees in the interim.
This can damage productivity and profit in a number of ways. For one thing, shifting duties to employees unfamiliar with them means the job will take longer and it won’t be done as well. In addition, this takes experts away from their assigned duties, potentially resulting in subpar performance or at least delays.
In the meantime, employees directly and indirectly affected by this shift in duties can begin to feel overwhelmed, overworked, out of their depth, stressed, and frustrated by the situation and the demands placed on them, further compromising output. In short, the ripple effects extend far beyond the vacant position.
Saving Time and Money with a Recruiter
Now the good news. You needn’t go it alone. A qualified recruiter that specializes in finding top-level talent can significantly reduce the amount of time a position is left vacant. Utilizing expertise and a network of trusted connections, an expert recruiter can not only deliver candidates for your consideration expeditiously but also serve up qualified contenders that are a suitable fit for your company.
This, in turn, can save you money, not only on the lost value provided by a properly filled position but on the productivity and morale of remaining staff. There is a cost to partnering with a skilled recruiter that delivers results, but the investment will save you an incredible amount of time and money in the process. Contact us today: recruiterie.com