In this competitive job market, an organisation has increasingly found a need to innovate in order to attract and retain talent. One such strategy that has seen the light of day within recent times has been collateral hiring, otherwise termed lateral hiring. This type of hiring pools experienced professionals from other companies and industries and, yet again, fills the core positions within an organization. But when is the right time to bring such a strategy? This paper looks at the best timing and conditions for implementing a collateral hiring program, the benefits of the strategy, and considerations.
What is Collateral Hiring?
Collateral hiring, also referred to as lateral hiring, involves hiring experienced professionals outside an organisation into mid-management and senior positions. Unlike in traditional hiring, which is primarily focused on entry-level positions within the organisation, lateral hiring introduces different experiences and ideas of fresh talent.
There are several advantages to using a collateral hiring strategy for an organization. These are diversity of skill sets and experiences, new thinking, and creative ideas because more and possibly brilliant ideas tend to come about when different people work together. Focussing is quicker, hence more productive. More industrial knowledge and contacts eventually achieve more. It is also an improvement on a talent retention strategy.
Rapid growth and expansion
One of the best times to consider the collateral hiring strategy is during periods of growth and expansion. Often in rapid-growth companies, the need to quickly fill strategic positions with seasoned professionals who can run on the blocks the day they join is required. Lateral hiring can be a good fit for bringing the right talent to support this kind of growth.
During such stages, organisations generally lack an in-house talent pool to help them survive the growth curve. Companies can fill the lacunas of their needs through an outside experience or professional rather than through an in-house talent pool. This is because it presents the advantage of responding to changes in markets, introducing new products, or entering new regions timelier and effectively.
Skill Gaps and Technological Advancement
The best time to choose a collateral hiring strategy is also when an organisation identifies a skill gap within its workforce or when there are technological advancements in the industry. With new technologies surfacing and industries changing, organisations could realise a need for apt skills to keep the business competitive.
In such scenarios, lateral hiring can provide entry points for professionals who specialise in specific areas of skills and knowledge. They can fill immediate gaps and, in addition, train existing employees, enriching the general talent retention strategy of the organisation.
Organisational Restructuring
A major change in the organisation, like restructuring or perhaps a change in strategic direction, can be an occasion to pursue collateral hiring. Organisational change always creates new roles or requires new skill sets not available in-house.
An organisation would readily embrace new structures and strategies resulting from industry disruption and competition through hiring experienced professionals from other companies or industries. That’s where the laterals would be called on to help smooth over any transition issues, giving the organisation a chance to get moving.
Industry disruption and competition
It is worthwhile to implement a collateral hiring strategy at times of industry disruption or increased competition for the organization. It is then that talent from the competitors and related industries provides valuable insights into the prevailing trends of markets, customer preferences, and innovative practices.
This can infuse new ideas and industry experience that helps organisations outpace the curve and respond more nimbly to shifts in marketplace needs. In addition, lateral hires bring valuable networks and relationships that can bring considerable benefits to the organisation in a wide variety of ways.
Succession Planning and Leadership Development
A retention policy must be part of succession and leadership development planning; such organisations should look into a collateral hiring strategy. They can bring fresh leadership styles, diversified viewpoints, and new ways of solving problems by recruiting mature professionals from the outside.
These laterals can also serve as mentors to the veteran employees; therefore, they can add to the succession pool of the organization. Additionally, they are able to fill crucial leadership positions at a time when the internal talent may not be mature enough to take on responsibility for the role.
Cultural Fit and Integration
Though the time is now ripe to follow this collateral hiring, there is an undeniable strong side to this in the form of cultural fit and assimilation. Therefore, for smooth and sustainable integration, lateral hires must reflect the values and work culture of the organisation.
To do that, organisations have to let employees know about company culture and values at the hiring processes, have great onboarding programs for the lateral hires, work towards collaboration between existing and new employees, and allow mentoring so that lateral hires fit in the organisation.
Cost and Compensation
Collateral hiring has a cost mainly in the form of employee compensation and benefits. The specialist might demand an advance salary or package compared to an internal hire or first-time appointment.
The cost should then be offset by the opportunity part of the experience brought into the organization. The investment needs to work within the confines of an organisation’s budget and be aligned with the overall long-term financial goals.
Conclusion
So, we can say that a collateral hiring strategy stands as an excellent methodology by which organisations can enhance their talent pool, drive innovation, and maintain competitiveness in the dynamic business environment today. Such a strategy would typically be best implemented during times such as growth, when certain skills gaps arise, organisational change, disruptions in the industry, or in preparation for succession planning.
However, it needs to be done judiciously and with consideration of the cultural fit, associated costs, and effects on the already employed people. By timing, for example, the application of a collateral hiring strategy and controls in potential challenges, an organisation can leverage the approach and have long-term success in building a diverse, talented workforce, thus supporting a rich talent retention strategy.