The companies that grow fastest in the early stages tend to be the ones that delay hiring the longest. The delay is not an accident. It is a strategy.
Why early hiring is often a mistake
The instinct to hire when growth accelerates is understandable. More customers means more work. More work means more people. The logic is straightforward. The problem is that early hires are made against a business model that is still being figured out. The person hired for a role that the business does not yet fully understand is likely to be the wrong person for the role the business eventually needs.
The companies that grow fastest tend to hire later than their competitors and more precisely. They have figured out what the role actually requires before they hire for it. The job description reflects the work, not the founder’s best guess about what the work will be.
What they do instead of hiring
Before hiring, the fastest-growing early-stage companies tend to do three things. They automate what can be automated. They outsource what can be outsourced without losing quality. They eliminate what does not need to be done at all.
The automation question is the most underused. Most early-stage companies are doing things manually that could be automated with tools that cost less per month than an hour of a full-time employee’s time. The founders who audit their operations for automation opportunities before hiring tend to find that the headcount they thought they needed is lower than they expected.
The outsourcing decision
The outsourcing decision is more nuanced. The functions that can be outsourced without losing quality are the ones that are well-defined, repeatable, and do not require deep knowledge of the business. Bookkeeping, certain customer support functions, and some content production can often be outsourced effectively. The functions that require deep knowledge of the business, the product, or the customer relationship tend to produce worse outcomes when outsourced.
The companies that get this wrong tend to outsource the wrong things. They outsource functions that require business knowledge and keep in-house functions that are well-defined and repeatable. The result is that the outsourced work is poor quality and the in-house work is consuming founder time that could be better spent.
The elimination question
The elimination question is the one most founders skip. Before automating or outsourcing, the question worth asking is whether the work needs to be done at all. A significant portion of the operational work in most early-stage companies is work that was started for a reason that no longer applies. The reporting that no one reads. The process that was designed for a problem that has been solved. The meeting that was useful once and has continued by inertia.
The companies that eliminate ruthlessly before hiring tend to be leaner and faster than the companies that accumulate operational overhead. The overhead that is not eliminated before the first hire tends to be inherited by the hire, who then becomes the person responsible for work that should have been eliminated.
Related from Impulsblog: The simple systems behind consistent business growth
