Got this from long-time Boagworlder, Paul Bond (man of impeccable musical tastes as well ;-)…
Hi Marcus and Paul, still loving the show even after all this time.
My questions to you are: how would you advise I go about taking someone on and should I take someone on full time or on a freelance basis? Also where should I start looking to find someone? And there’s the financial side, I plan to have a couple of months wages in the pot to cover an extra person’s backup, does that sound enough? Also, whoever I take on needs to make the business money obviously so I was wondering if there was some sort of magic ratio or formula that I could use to see how my business model will fare against employing a new person?
You guys regularly employ new designers so I would be interested to hear your criteria for hiring someone new. Keep up the good work, if for nothing else, so that Rissington podcast can continue learning from the masters!
Ok, there’s a lot here! I think the first thing I need to discuss is whether Paul is looking for an employee or a partner. He mentions that whoever he takes on needs to make the business money. If he means for the new person to actually bring work in, and assuming he’s not looking to take on a sales person, then I guess he’s looking at a partner. That is, someone that fulfils a similar role to him. This would effectively be two freelancers deciding to pool their talent (and client list) with a view to expanding that client list but particularly, taking on bigger jobs.
Finding the right person for this type of role, I believe, takes a lot more than just advertising. You need to know and trust this person, so I would expect only an ex-colleague would fit the bill.
However, if you’re looking to take someone on to pump out the work while you’re out there getting more, then that’s a different kettle of fish. You can’t expect this person to make the company more money per se. Rather, you are looking at having more resources available so you can take on more work thereby raising the monthly bottom line.
There’s no real magic formula; just simply, can you make more than this person’s salary every month. If you can feed the extra mouth then you’re in a strong position to grow the company. If not, then you might want to run with it for a while anyway (if you can afford to) because staying solo does limit your options – for growth and for expanding the work you can take on which eventually leads to more work etc etc.
A couple of months ‘break even’ is what I would recommend you hold in reserve. So that adds up to your salary, the new salary plus any bills you’ve got.
I’m jumping around a bit, but let’s move on to the working together option. Not even 6 months ago I would have been indifferent to this. Basically, the pros of being able throw the net wider and the fact that a lot of people (particularly designers) like to lock themselves away (and therefore potentially make the position more appealing), meant that we tended to err towards people home working. However, my mind has definitely changed on this lately. Our development team have demonstrated that working together brings huge productivity benefits in that people constantly share problems and help each other out. This has worked out so well that we have moved the design team over to a similar model.
Ok, moving on to who to take on – taking on freelancers can often mean the difference between being able to deliver a job or not. However, they are expensive and will badly erode your bottom line if you do it all the time. So, ask yourself – if I had an employee instead of a freelancer over the past X months, how much would I have saved?
Employees are a responsibility though and need looking after. One thing we have learned over the years is that happy staff make for more productive and more effective staff.
With regard to finding staff, there are a number of options:
- Employment agencies – these can be good and are often the quickest way to find suitable staff. But… they add a huge cost to the whole process.
- Websites like ThinkVitamin or 37 Signals can be a very good way of finding the right people too. However, this has been very hit and miss for us.
- Ex-colleagues are often an excellent bet as you know them well. I guess on this one – don’t be afraid to ask.
- And, of course, advertise on your own site.
Finally, how do we decide when to take someone new on? Well, we don’t really have a set method! Usually we start to notice that workloads are getting beyond the point of just ‘busy’ and we wrangle over whether we need permanent or freelance help. Often a new client or job will tip the balance.