In our last blog, we looked at the heavy rates of attrition that are unique to the recruitment sector and walked through ways you can attract, onboard and retain the best talent (without having the biggest budget).

But… there is much more to add and (as usual) the world turns quickly. When it’s time to hire, future planning and financial planning need to be adopted or you can find yourself in uncomfortably warm water further down the line.

Looking at the recent massive layoffs within Klarna and their pre-recorded video message from the CEO informing 10% of their team that they are now jobless… there is a hell of a lot to consider when interviewing.

Klarna’s CEO Sebastian Siemiatkowski advised, “When we set our business plans for 2022 in the autumn of last year, it was a very different world than the one we are in today.”

Klarna has some 7000+ staff so we can safely assume that at least 700 are now unemployed. Not getting into the merits (or lack of) when firing en masse, rival FinTech’s swooped in and circled with a savvy PR move reporting that by stark contrast they were hiring for hundreds of roles. Wise CEO Kristo Kaarmann said that “years of building Wise as a profitable, long-term company is now paying off.”

So, where did Klarna go wrong and what lessons can we learn when hiring, planning and futureproofing?

A huge consideration when you hire new staff is your pay scales, pay progression and your return on investment. Will your pay scales eventually outweigh the ability of your new hire? Greater consideration needs to be given to your return on investment and aligning pay scales to the candidate you are talking to. Factor in experience, hard skills, soft skills, cultural fit and (importantly) a candidate’s potential. Align your pay scales in such a fashion that they support your ROI.

Another area to consider when attracting (and keeping) the best talent is personal development. Personal development can establish goals and targets, help with planning and motivation and leave your staff hungry and engaged. No employee, recruiter, or manager wishes to languish and stagnate in their role. Your experienced consultants are particularly at risk if they progress into management and then training and development stop. A competitor can easily make a more attractive offer when it boils purely down to price. An ongoing culture of learning ensures that minds are challenged, and roles stay fresh. Does each member of your team have a personal development plan (PDP)? Their PDP is an individual process of creating an action plan based on goal setting, awareness, values and reflection within the context of career pathways, upskilling and self-improvement. Such a plan can be reviewed during regular appraisals and feedback sessions and makes for an excellent progress tracker and motivational tool. It can even help you align pay scales more accurately and avoid paying more or less than the rate of a candidate’s progression.

Formal learning, such as external training courses, industry qualifications and events means that you have your best and most knowledgeable team and they feel encouraged, confident and valued. Special projects, mentoring and buddying programmes also work well and encourage collaboration. With a whopping 66% of workers aged 18-25 citing learning new skills as one of their top considerations when picking an employer, such incentives can be your competitive edge.

How Can Financial Planning Steer Hiring Decisions?
Financial planning is one of the most crucial elements of business planning and relies on financial data, experience, projections and forward-thinking. Whether you’re planning and strategizing, looking for investors, or you are considering a bank loan; your financial forecast shoulders a lot of responsibility and steers the business.

So, how can financial planning steer hiring decisions?

Financial planning helps you eliminate subjectivity from your hiring process. Understand your current workforce and how it’s projected to change over time. Klarna’s failure to accurately do so was clearly a big factor in their subsequent struggles. Digital finance saw a major boost following the pandemic, but the sector has taken a beating in 2022 – a beating that rival brands planned and prepared for. Economic uncertainty often sees business leaders asking, “should I be downsizing, scaling, or planning for both?” Even when funds are lean, it’s vital to conduct financial and workforce planning for your future goals and needs. Finance generally set the budget and HR the workforce plan but it’s those involved in workforce planning and hiring that need to review performance vs. spend against the budget or most recent forecast. This ensures that any discrepancies between headcount and spending are spotted, isolated and adjusted with corrective action so the problem doesn’t magnify. Upskilling and reskilling are cost-effective ways to contain costs whilst progressing your business and your people.

We all know employee turnover is expensive. Upskilling and investing are much smaller, measured investments and allow you to remove skills gaps, improve retention and boost employee morale.

Considering the technological advances of recent years, keeping pace is a challenge for companies of all sizes. Whilst the obvious benefits of technology shine, a downside is the skill gaps it creates. Training ensures your workforce remains up to date.

It certainly isn’t just money that motivates your staff to move on. So many factors contribute to a healthy, happy, loyal workforce. Even remote and flexible working must now be considered in 2022 to attract and retain the best staff with many companies looking at a harmonious blend of the two where possible. It isn’t just the business with the deepest pockets that wins the recruitment wars. From starting with a solid induction process to ongoing training and opportunities, staff morale and planning, your hiring choices are only the beginning.

From mentoring and building business confidence to strategic growth and training, I help service-based and recruitment businesses retain the best talent and profitably scale their business.

Are you ready to attract, retain and build your best team yet?

Then please get in touch for more info