The process of hiring a new employee requires substantial time and financial investment from a company and its employees. This makes it critical that you’re hiring the right person, setting up the right expectations, and setting your new employee up for success. On average, a new hire costs about 1.5x the actual annual salary. Turnover can increase that cost even more, when considering the overall financial impact on the company, inclusive of hard fees, your time, training time, and lost time executing the role.
The stakes are even higher when creating a brand new role or a role that will be responsible for forming and defining a new department, leading teams, managing staff, or shaping the future leaders of your organization. Understanding what success looks like and how to evaluate the role is a critical first step in the process. If it is a new position, you will not be able to model the position with learnings from a past success or failure in the role. You need to define the KPIs for the job to communicate these clearly to candidates and other team members in the organization. Smart candidates will look for roles that align with their strengths, knowing that they will be able to make a positive impact.
Work with your team, the HR department, leverage your network or work with an executive recruiter to thoughtfully and carefully develop a thorough job description. Don’t create a laundry list of everything you’ve seen on other job descriptions. Create a concise list of the skills and expertise needed for this new position that is focused on successful execution for the candidate and the existing team. A well-crafted description will net a better crop of candidates and will help you evaluate individuals based on their credentials and experience. If you’re hiring someone to run Business Development, then creating a KPI for successful close rates for Business Development and tracking their wins will help you make a more informed decision as to whether or not the candidate meets your criteria.
Developing a thorough and precise job description is essential, but a critical component is often forgotten: defining success. New hires need a clear understanding of how they’re going to be evaluated, how regularly they will be assessed, and how success is measured. Without setting clear goals and KPIs in the job description, the new hire may have a different perception of success, and you could potentially be setting yourself up for turnover and possible legal issues if they feel they were improperly terminated.
Title and responsibility alignment are essential for the new hire and also for investors and the team. Ensure you evaluate your core needs to right-size the position. As an example, evaluate to understand if you really need a CMO or if you need a Marketing Manager. Then set internal expectations accordingly: do not expect the Marketing Manager to fill the shoes of a CMO. Do not hire a CMO when you need a Marketing Manager. It’s critical to right-size the position, title, and expectations with the expected outcome.
That being said, there can be some flexibility to newly created roles. An executive search firm can help you represent the opportunity, as opposed to the title. It’s important to sift through people, experience, and viability to find the right person for the position. Titles are most often inconsistent with experience, especially in cannabis or for someone moving into cannabis. It is critical for your company culture to ensure the title fits the mindset of the organization and the current employees.
The next step is building the right compensation package for the person you’ve identified as the ideal fit. Build criteria that will help you determine how to confidently create a compensation package that suits the person and the situation. As an example, knowing you’re looking for a buyout and have a three-year exit strategy might rationalize spending more for the short term. If you’re looking for a longer-term play, then you might need to get creative with your compensation package and consider incentives that might sweeten the deal. There are many ways to create compensation packages, and the right executive search firm can help you craft the right fit.
With purposeful and thoughtful development of a job description, a clear understanding of what success looks like, KPIs in place, and a fair compensation package, you’ll be setting any new candidate up for success in the cannabis industry.