Insights in Human Resources: Getting the Strategic Advantage of Higher-Priced Hires

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In today’s competitive agricultural landscape, hiring the right talent is critical for a company’s success. As our businesses strive to innovate and outperform their competitors, the demand for skilled professionals has skyrocketed. This often means that businesses must consider hiring higher-priced employees who bring exceptional skills and experience to the table.

 

However, justifying the investment in such talent can be extremely challenging. One effective strategy that can support this decision is the establishment of individual set goals. By aligning individual objectives with the company’s overarching mission, organizations can not only justify the higher costs but also maximize their return on investment.

Our typical conversation with our clients is a collaborative effort to chart the company’s course over the next five years.  We deeply value their insights into the company’s current needs and challenges, as these are crucial in propelling the company to new heights.  We discuss the skills they envision in a new hire, and the passion and drive they believe are essential for the job.  The specifications for the new employee are indeed remarkable.  The hope for the positive impact they will bring to the bottom line is high, and the leadership eagerly awaits resumes that align with these aspirations.  Then comes the question of compensation into focus. Leadership decides to be conservative with their compensation range in hopes of finding a great candidate for a low salary.

At the moment of their decision, a couple of things happen. Firstly, the pool of potential candidates for their role is greatly reduced. This not only limits their ability to hire immediate talent but also restricts their prospects and the potential impact that a top candidate could have on the company’s future.  The second thing that happens is the company adopts the perspective of an employee being an expense instead of an investment.

Hiring higher-priced employees can be a daunting financial commitment for any company. Creating goals for the employee to reach helps you get a return on your investment.  Clearly define the individual goals aligned with the company’s strategic plan.

This investment is easier to justify. Establish specific goals for higher-priced employees to clearly define the expected return on investment (ROI). For example, if a senior marketing professional is hired at a premium salary, their goals might include increasing brand awareness by a certain percentage or launching successful campaigns that generate significant leads. The tangible results from these efforts can directly justify the higher salary.

By setting specific goals, a company can mitigate its risk. Setting individual goals reduces the risk associated with hiring expensive talent. It ensures that the new hire has a clear understanding of their role and the expectations from day one. This clarity minimizes the risk of underperformance and helps in quicker integration into the team.  Another point to keep in mind is to link compensation to goal achievement.  This will ensure that higher salaries are justified by performance.

For instance, a sales director might have a base salary supplemented by performance bonuses tied to specific sales targets. This approach aligns the employee’s incentives with the company’s success, ensuring that higher pay is matched by corresponding contributions to the company’s bottom line.  High-achieving professionals are often attracted to roles where they can see a clear path to success. Individual goals provide this clarity, making the company more attractive to top-tier candidates. This can be particularly important in our competitive BioAg industry where talent is scarce, and demand is high.

To maximize the benefits of individual set goals, companies should follow best practices in goal setting. Create SMART Goals with your employees i.e. Specific, Measurable, Achievable, Relevant, and Time-bound.

This framework ensures that goals are clear and attainable, providing a roadmap for success. Then provide regular check-ins and performance reviews to keep goals relevant and allow for adjustments based on changing business needs or individual performance.  During the routine meeting, communicate how their goals align with the company’s strategic objectives. This transparency helps the new employee understand the bigger picture and how their efforts contribute to the company’s success.  When they are succeeding, recognize and reward it.  This not only reinforces positive behavior but also encourages others to strive for excellence.

Consider a recent example of a small AgTech company looking to expand its reach in a new market. The company has decided to hire a highly experienced Market Development Manager at a premium salary.  To justify this hire, the company sets specific goals for the new Manager.  Receiving an ROI for this hire involves a comprehensive approach with both quantitative and qualitative metrics. By setting clear goals, utilizing analytics, and regularly reviewing performance, companies can effectively measure the impact of their marketing leader and ensure they are driving growth and value. A few examples: ind

1.     Achieve a 5% increase in market share within the first year.

2.     Increase the number of qualified leads by 20% within six months.

3.     Achieve a 25% increase in visitors to the website.

 

We hope this helps you in establishing individual goals, a powerful strategy for justifying the hiring of higher-priced employees. You can have the best employees by aligning personal objectives with the company’s strategic goals. You can ensure that every employee’s efforts are contributing to the organization’s success.

 

This alignment not only enhances performance and accountability but also mitigates the risks associated with expensive hires. The best of all, it creates a motivated and engaged workforce, driving continuous improvement and innovation. In a competitive talent market, this approach can be the key to attracting and retaining the best professionals, ensuring long-term business success.  We hope this helps you!

 

Please reach out to let us help your company grow further.