Four Talent Systems Every Growing Business Needs (Before You Need More People)

Many founders believe growth creates hiring challenges.

The opposite is usually true.

Poor talent systems create growth challenges.

The companies that scale successfully don't just hire more people; they build systems that consistently attract, select, develop, and retain great talent.

Similar to a financial or sales system, a talent system is repeatable, documented, and scalable. Most importantly, it does not depend on a founder or executive to run.

The good news?

You don’t need a large HR department to build those systems.

You simply need to be intentional.

Every growing business should purposefully build four interconnected talent systems. When those systems work together, they produce the outcome every founder wants: retaining the right people.

System 1: Attraction

You compete for customers every day. You should compete just as intentionally for talent.

Don’t wait until you have an opening to start attracting talent.

Desirable employers are always building awareness.

Instead of asking, “How do we fill this job?”

Ask, “Why would someone want to work here?”

Just as you clarify why a customer would buy your product or service over a competitor’s, you need to clearly articulate why someone would work for you over anyone else.

Your employee value proposition (EVP) is the combination of all the benefits and opportunities you offer. People choose to work for you when their values, goals, and desires align with your organization’s EVP.

You should define your EVP so you can clearly explain who will thrive in your organization. You want to attract those people, and not others, to your opportunities.

Often, what you, the founder, and other executives think is attractive to employees is not what employees find most valuable.

When I joined NVR, executives believed that early-career talent chose the company for the autonomy they received early in their careers. But after interviewing new hires across the country, I heard something very different. It wasn’t independence that attracted them. It was the company's training program, which gave them the confidence to succeed once they were on their own. That insight completely changed how we talked about careers at NVR and dramatically improved our ability to attract the right candidates.

The operating system begins with attraction. This system consistently communicates your EVP to individuals with the skills that will benefit your organization. It includes:

• A clearly defined employer brand message based on your EVP.
• Employee stories that capture the authentic voice of the individuals currently benefiting from your environment.
• A career page highlighting career paths, benefits, your environment, your hiring process, and opportunities to connect with leaders.
• A presence on LinkedIn or other platforms where your target audience learns about careers.
• Thought leadership through conference presence, speaking engagements, webinars, blogs, and industry articles by founders and other executives.

Potential future employees should know your company and what it is like to work there before they ever see a job posting. With a properly developed and executed talent attraction strategy, you will have a robust pipeline of the right talent actively waiting for the right opportunity. They already know you, what you stand for, and why they’d want to work there.

System 2: Selection

A strong talent attraction system fills your pipeline with interested candidates. The next challenge is determining which of those candidates are most likely to succeed.

Selection is where organizations make their first critical decisions, and often their costliest mistakes.

The interview process should predict success, not just identify likable candidates.

Many founders hire based on:

• Chemistry
• Gut instinct
• Shared backgrounds or interests

Unfortunately, that approach leads to hiring homogeneous teams. This approach also does not guarantee that the individuals can actually perform in their jobs or will stay with the organization long-term.

According to Gallup, the cost to replace an employee is between 50% and 200% of their salary. A “gut-feel” selection approach can be costly for a scaling business.

With a talent selection system based on skills and competencies, you can quickly identify the best-fit candidates and reduce turnover. When my electronics manufacturing client implemented this approach, they reduced their time-to-hire by 50% and their first-year turnover rate by 25% in less than one year.

Skills help someone do the job. Competencies determine how they perform it.

For example, a marketing manager role requires the ability to develop marketing strategies. If the role requires working in a large team and directly with a client, the competency of collaboration is also required. A candidate could be highly skilled at marketing strategy but not competent at collaboration, and therefore not a fit for this specific role.

An effective talent selection system contains:

• Defined competencies and skills for each role
• A structured interview process with defined questions and trained interviewers
• Consistent evaluation criteria
• A process for evaluating candidates for long-term success

Done well, this system reduces poor hiring outcomes, improves retention, and removes gut-feel from the process.

System 3: Onboarding

Selecting the right person is only half the job. Your next challenge is ensuring that person becomes a successful employee.

Hiring doesn’t end when someone accepts your offer.

Many organizations spend weeks or months recruiting someone…

…and then spend 30 minutes welcoming them.

Your onboarding process tells employees whether the promises you made during recruiting were real.

The height of a new hire’s excitement comes right after they accept the job, yet many organizations fail to capitalize on that excitement and momentum.

A recent BambooHR study found that 44% of new hires had regrets or second thoughts about their decision within their first week on the job. A robust onboarding system will significantly reduce new hire regret and turnover.

After a new hire accepts their offer, the company sends links to benefits documents and information about where to show up on their first day. They offer a brief orientation, give them their computer equipment, and send them on their way.

When you lose the opportunity to capitalize on the new hire’s excitement, the operating system begins to fail before the employee has even started contributing.

A winning onboarding system capitalizes on new-hire commitment, delivers on recruitment promises, and fosters long-term engagement.

The onboarding component of the operating system contains:

• Preboarding: Regular engagement from offer acceptance through Day 1
• First-day experience: Robust welcome day with executive, manager, and peer engagement
• First-week plan: Introductions to key staff; systems enablement; goal-setting
• First 90 days expectations: Key milestones and regular feedback; clear manager and employee expectations

System 4: Growth & Development

A successful onboarding process helps employees become productive. A development system helps them continue growing long after their first 90 days.

People stay where they can grow.

Organizations without plans to develop employees’ skills and careers will suffer from disengagement, burnout, and turnover.

Development opportunities traditionally include structured training programs, defined career paths, and leadership development. However, employee growth can take many forms, including:

• Stretch assignments
• Coaching
• Mentoring
• Job rotation
• Career conversations

Growth isn’t always promotion and is rarely linear. Employees advance in their careers through a combination of opportunities and learning modalities. To keep them motivated and engaged, offer a variety of methods to expand their capabilities.

Create a growth and development system within your organization that reflects your values, uses available resources, and adapts as it evolves.

Executives often think that development requires large budgets. In reality, the most impactful development usually occurs in conversations between managers and employees.

Development is a retention tool.

Employees don’t stay simply because they have a job. They stay because they continue to see a future.

Create a system focused on employee retention. As your business grows, formal programs may not be necessary. Your management team, however, is the key to providing employee development.

Properly trained managers provide and manage stretch assignments and regular career conversations to increase skill development and employee engagement.

They mentor more junior staff to develop competencies and build effectiveness.

Managers rotate top employees into new roles to provide workforce flexibility, increase employee knowledge about the company’s products and services, improve succession planning, and spark innovation.

Build a development system that measures managers' success, not just employees' growth.

The Outcome: Retention

Every promise made during attraction, and every experience employees have during selection, onboarding, and development either strengthens or weakens retention.

Retention isn’t a separate talent system to build. It’s the outcome of getting the first four systems right.

Like an operating system, your talent systems are almost invisible when they’re working well. But when they fail, every part of the organization feels the impact.

That’s why the most successful founders don’t wait for turnover reports to tell them something is wrong. They regularly evaluate the health of each talent system before people issues become costly business problems. Evaluate these four talent systems now because every growing organization eventually reaches the point where talent is either its greatest accelerator or its greatest constraint.

The difference is in the systems you build before growth demands them.