08
Mar
2020

Investing in Employees Is a Lot like Investing in Stocks: Follow These 3 Investment Tips

Right from hiring to employee development – the recruitment game can be quite complicated. To simplify the processes and understand the intricacies involved, try approaching this game as you would approach the stock market. Think about investing in employees the same way an investor would think about buying a stock. Here are 3 tips investors follow while investing in stocks. You can implement these tips in your hiring strategies and learn how to recruit effectively.

Tip 1: Buy low. Assess present value Vs. Future Value.  

While buying stocks, investors don’t care much about the value of the stock today. They buy the stock because of its potential to grow in the future. That’s exactly what you should do while hiring employees. Don’t worry about what they can do today; what the employee has to offer in a year or two is more important. When you hire at the low-end of the learning curve, you look at the potential rather than achievement. This is your “buying low.”

Look for candidates who are fast-learners with impressive decision-making and problem-solving skills. These are the employees who are more likely to excel in the future and eventually boost revenue. However, these traits aren’t always easy to assess and identify in employees. Therefore, you need strong recruitment strategies that include tests in the candidate screening process with a focus on the learning speed and analytical abilities. Thanks to technology, all these things can be easily done with the help of an applicant tracking system.

Tip 2: Patiently Hold the Stock. Determine Risk Vs. Reward

Investors do their homework before buying the stock. They are aware that it may take some time – even years for the value of the stock to rise up to its true value.

When you hire a person into a new role, they are at the bottom of their learning curve. You have identified their potential, but you need to give them time to grow. You need to be clear about what value the new employee will create for the organization. Help the new hire come up the learning curve with proper training and mentoring.

Once they have reached the tip of the learning curve, they become competent, confident, and increasingly valuable – the value that your organization can bank on.

Tip 3: Sell High. Figure Out Expected Return Vs. Required Return

When investors see that their stocks are performing better than its peers, they make a decision to sell the stocks at a much higher price. This decision could be tricky because if the investors don’t sell it at the right time, they may lose the gains.

So, as your new hires reach new levels of mastery, regular tasks become easy and boring. Before they become complacent, you may want to stir them up a bit. An important question to ask is, “Is this person ready to grow?” If they are, make a growth plan. Provide training to upskill them. Encourage them to take up new responsibilities or new assignments within your organization.

You can help them to take a new role, invite them to be mentors to apprentices in your organization. This is your “selling high”. You are coaching and mentoring valuable employees to new learning curves so that their value doesn’t stagnate or erode.

Your investment in learning and development of your employees is like interest on your money – it has a cumulative and compounding effect on the company’s investment. If you keep giving your employees new learning curves, they have something new to learn always. Therefore, they are more likely to continue adding value to your team in the future. 

Conclusion

At the end of the day, stocks and employees are investments. You’ve got to get both of these right to make a profit. By approaching your hiring strategies and employee learning and development the way an investor would approach the stock market, you’ll be better equipped for making wiser decisions and ending up with a portfolio of employees that can take your company to new heights.

Author Bio: Kelly Barcelos is a progressive digital marketing manager for Jobsoid – Applicant Tracking System. She is responsible for leading the content and social media teams at work. Her expertise and experience in the field of HR enables her to create value-driven content for her readers – both on Jobsoid’s blog and other guest blogs where she publishes content regularly.

You may also like...

Leave a Reply

Your email address will not be published. Required fields are marked *