Talent: Build vs Buy

Had an interesting discussion with a new client about whether it is better to build or buy talent.  I’ve had similar conversations with other clients over the years.  Small businesses face the dilemma frequently.  Do they hire and train newbies, or do they hire experience?  It may appear to be cheaper in the short run to hire and train newbies.  But, you have to spend a lot of management time to train newbies and the ramp up time for them to become effective in their jobs is long.  Yet, if you hire experience, are you able to justify the cost of higher salaries?  And, in the case of experienced sales professionals, are you willing to be patient for results?  Far too many business owners expect immediate results.  Or, believe their “experienced” hires do not need training.

Whether you hire newbies or experience, I’d suggest you provide training and personal development for both.  Don’t expect an employee’s prior employer to train your people.  Take a proactive approach.  Train them your way.  Train them often.  Mentor them frequently. 

Build vs buy depends on three things:  1) Your budget, 2) your willingness to train, and 3) lead time for results. 

The “build” talent approach is often used with smaller companies, mainly due to budget reasons.   The larger and more mature a business, the more likely they can afford experience.  The pros and cons of each approach should be considered for each new position.

Here are other viewpoints on the subject:

http://arunkottolli.blogspot.com/2006/05/hiring-in-high-tech-firm-build-vs.html

http://www.humanresourcesmagazine.com.au/articles/2F/0C02E52F.asp?Type=60&Category=1223