With every EOS® client, we develop what is called an accountability chart – a souped-up organizational chart that shows not job titles but roles, and the main priorities for that role. During the process, we’ll usually smoke out several issues, including my favorite: the boss wears too many hats, and doesn’t feel he or she can give one up. It doesn’t often matter that the person wants the role or is good at it – they just aren’t comfortable handing off a role to someone.
Then let the excuse games…begin! The typical reasons I hear:
- “I simply can’t afford to hire someone right now.”
- “I can afford it, but I’m too busy to look for or train someone to replace me”.
Is this you?
If you are an entrepreneur or leader of a small to mid-sized business, do either of these statements look familiar to you? If you say those out loud, say this out loud, too: “I wonder what it costs me to wait to hire someone until some magical future date?”. I’m glad you asked!
Find out what it costs you to NOT hire someone: the exercise.
Here is a simple exercise that should take less than an hour, total.
- If you are a company already using EOS®, print out your long term and running issues lists. If you are not yet using EOS®, just take 30 minutes to write down all the problems, issues, obstacles and barriers that you and your company are experiencing.
- For example, let’s do a little math. Maybe the issue is “we have no marketing plan and our leads are flat, and therefore our sales growth is flat”. Take a guess as to how many more leads you can get with a dedicated person to fit a marketing role. Perhaps you figure that the increase would be 50 additional leads a year, and you know that you usually close 30% on your leads (so, 15 sales). You know you make on average $10,000 profit per sale. So, the additional profit per year is $150,000 is currently a “cost” of not having such a person, minus their salary and benefits.
- What other hidden costs are there? Are you losing clients, overworking yourself, or ignoring other priorities? Are you just not doing the role well, or at all? Write all of these down.
- Now write down what the compensation costs of hiring someone: salary, taxes, bonuses, benefits, stock options. Is it a part time or a full-time position? Can you start smaller? Be creative. A rule of thumb I like to use to calculate true costs: multiply the salary by 1.4 to get the top end ‘all-in’ cost of an individual. So with the example above, if you were hiring a full time marketer, and in your area salaries for that position are about $60,000, the true cost is $84,000.
- Compare the two figures. Is the cost of not hiring higher than the cost of hiring?
If it’s a toss-up (or in favor of hiring someone), make it a priority to hire someone as soon as possible. Will it take more time initially? Probably. Will it be worth it? Most definitely. Just imagine still doing what you are doing now, next year, and the year after that… and the year after that. It probably feels like Groundhog Day.
Otherwise, you are only hurting your company and probably killing yourself, too. Few people have the time to fill two roles and be really good at both of them.
Still feeling stuck?
I’ve dealt with this many times before, and would be glad to spend a little time – pro bono – walking you through your situation. Feel free to reach out to set up a time to talk.