In a fast-growing SaaS company, hiring often happens almost as an afterthought. You’ve suddenly got more work than your developers, customer service team, and sales staff can handle – so you ask around in your network to see who you know who might like to come on board.
While that may work for your initial hires, it isn’t going to cut it as your SaaS company grows. For your business to thrive, you need a good hiring strategy.
What is a Hiring Strategy?
A hiring strategy (or recruitment strategy) is a clear plan that helps you identify, attract, and hire the best people for the roles you need.
It doesn’t need to be anything complicated or detailed, but your hiring strategy should help you be clear about how you recruit (e.g. where job ads are posted, what networks you turn to), what you do to attract the best candidates, and how you go about the process of assessing resumes and cover letters, interviewing candidates, and ultimately extending an offer.
Five Reasons Why Your SaaS Hiring Strategy is So Important
As a SaaS company, you might be used to adapting and pivoting as necessary – or “building the plane as you fly.” But your hiring strategy definitely isn’t something you should leave to chance or develop in an ad hoc way.
1. One Bad Hire Can Seriously Affect a Small Company
One bad hire in a company of 1,000 isn’t going to make a significant difference.
One bad hire in a company of 10 is going to hugely affect the company. Something as simple as making careless mistakes with your client invoicing system could seriously impact on your bottom line.
You can’t afford to get hiring wrong – which means you need a clear strategy.
2. Hiring Haphazardly Will Take a Lot of Your Time
If you think you’re “too busy” to create a hiring strategy, then you’re definitely too busy not to have one!
Hiring haphazardly will waste your time. You might spend ages hunting for applicants, you might interview people who were never going to be a good fit, or you could have a huge pile of poor-quality applications to sift through because you’ve got no clear means of differentiating candidates.
3. Laying Off New Hires Will Adversely Affect Morale
If your company is based in an at-will employment state, then you might think that a poor hire is no big deal – you can simply lay that person off. Sure, you’ll have invested some time and money in the employee, but it’s not a huge loss.
It’s easy to overlook the effect of layoffs on other staff members. If a new hire is let go after only a few weeks, other employees might start worrying about their position. They might also draw erroneous conclusions (e.g. that the company is struggling financially).
4. Hiring From Your Network Won’t Work Forever
When you started hiring your first SaaS employees, you probably turned to your network. You began by reaching out to people you knew – perhaps from previous jobs or even from college.
While hiring from your network can work well initially, it’s not a sustainable long-term strategy. Once you’ve hired a couple of developers, for instance, you may well have exhausted the pool of available talent in your network.
5. Good Hires Help Create Great Culture
Making the right hires will help your business in so many ways. Good hires will get the work done well, come up with new ideas, and even help you to foster a great company culture.
You don’t want to fill your SaaS company with employees who are there to do the bare minimum, who don’t care about quality, or who don’t get along with other staff members. Instead, you want to make good hires so that your workplace is a happy, positive place for everyone.
Eight Tips for Building Your Hiring Strategy
Ready to start building your hiring strategy? Here’s where to start:
- Filter out poor candidates early on in the hiring process. For instance, you could screen job applicants before looking at applications more closely. One way to screen applicants is to give everyone a questionnaire to help you learn what they know or understand about your industry already. If they can’t even be bothered to complete it, then rule them out of the running.
- Get your current employees to refer people they know. Many companies offer an incentive if a referred candidate joins (and stays for a certain period of time). This can be a great way to tap networks beyond your own.
- Use your website effectively. You need to communicate to employees what you can offer them. That doesn’t just mean the money. Employees will also want a sense of meaning in their work, flexibility where possible, and clear opportunities for growth and development.
- Clearly define the role and responsibilities. Before posting a job ad, get really clear about what the role is. Otherwise, you’ll struggle to attract on-target applicants. It’s also important to make sure that you actually need a full-time employee for the role. If you think a new hire might end up sitting around with nothing to do, consider hiring a part-time employee or even a contractor.
- Make sure you run your job ad and other materials (like planned interview questions) past your HR person or team. You don’t want to inadvertently ask anything illegal, such as asking whether a candidate is pregnant.
- Use tools such as HCM (Human Capital Management) software to manage the hiring process efficiently as well as to manage your workforce. If you’re not too familiar with HR, check out this piece on Human Capital vs Human Resources.
- Be upfront about salary. There’s no point doing round after round of interviews with a superstar candidate if they’re expecting $200,000 and the most you can pay is $80,000. Your job ad should make it clear what salary range candidates can expect. If this is lower than the industry average, emphasize other benefits and consider boosting these (e.g. offering more paid leave, allowing flexible working).
- Consider hiring a recruitment service. When you’re running a SaaS company, it can be really tough to find the time for all the tasks involved in hiring – and getting a recruitment company involved will often speed up the process a lot.
Spending a little bit of time and effort creating a hiring strategy can pay off over and over again. Make sure you know what you’re looking for and create a system that helps you find the best applicants for your SaaS company.