What should you pay senior hires to attract top talent without overextending yourself?

In so many of my clients, they go on a limb, they make a senior hire that they feel like they really can’t afford. And when they’re like watching the person like a hawk, like you better not screw this up. That is a lot of pressure for you. It’s a lot of pressure for that team member. It makes it really hard to onboard because you feel like you don’t have time to really do it. They got to be delivering immediately.

I think we’ve got to wrestle with that. Welcome to Leading Small Teams, a Real Talk podcast tackling the ins and outs of leading teams in the modern workplace. I’m Leah Garvin, your host. With a decade of experience driving team operations in companies like Google, Apple, and Microsoft, bringing you insider strategies to make you a more confident and effective leader. From delegating to feedback to avoiding micromanaging and more, this podcast gives you the tools to empower your team, scale yourself as a leader, and grow your business.

Whether you are managing a team of one or 100, everyone is welcome to hang out with Leading Small Teams. Hiring is one of the biggest challenges that we face as a leader. Whether we are hiring our senior role like to really help us grow and scale our business, or we’re hiring a VA to really get some of our time back, or anything in the middle. It is one of those things that there’s no guarantees around because we’re dealing with people.

We are dealing with the ups and downs and intricacies of their personalities and if people show up well in an interview and really actually are the same when they start, that’s always a question. But we have to hire folks if we want to grow our team and we want to scale our businesses. So it’s one of those things that I wouldn’t say is like eating our broccoli or eating our veggies as a leader because I think it’s actually, well, I love veggies, so maybe it is that.

It is one of those things that has the potential to allow you to reach infinite growth with your business, infinite customers and results and revenue and profitability. Hiring is the way that you do that. Now, okay, in this modern world there’s probably a lot you can do with automation and AI and agents, so I’m not telling you that’s not part of it. But scaling yourself and your business and why you’re listening to this show is because people come into play for part of that.

Now, in future episodes I will talk about kind of figuring out delegating work or hiring between person and automations and agents. I think there’s a lot of really interesting stuff being done in that space. I also am a little bit terrified of a lot of it too as I’ve talked about on this show. I think I’m a little bit more on hesitating to fully hand over entire roles to automation because I think there’s still a lot of value in the human piece.

But alas, it is here, and so we will talk about it. Today, however, I want to talk about that really tough situation when you’re trying to hire a seasoned person, a senior person to take on a role, and the goal is that this person, let’s say it’s a COO or maybe a director, they’re going to head up marketing or really build out your sales team or be that manager kind of so that you can be stepping out of the weeds a bit.

You want to hire this senior person, and they recognize it’s a senior role. It’s got a senior title, a lot of responsibility, but you’re a small business. You have maybe 10 employees or between full-time, part-time contract, you have 10, 15 people, and this person wants that Fortune 500 salary. So this person at that director level or VP level wants $200,000 or $300,000. And you’re thinking, well, they have a great resume, and they have a great track record, and I know I need someone to join my company in order to grow to the goals that I have, but do I do this or not?

And this is a question I get from leaders all of the time because it is something that’s really, really, you know, we’re wrestling with. Like, I don’t want to stifle my own growth, and I don’t want to get in my own way, but I also don’t know, like, is this fair to be asking? Now, first and foremost, I think what you are offering someone, it might be composed of many different things. It might be composed of a salary.

There might be bonus. There’s the benefits. There’s all sorts of things in there. And so as you’re thinking about how to really be rewarding and kind of incentivizing someone to be joining your company, I would just say to not get locked into the one number and to be talking about it from a broader perspective, right? So that is one thing I think we can already just be doing, like, hey, what is actually the value that you get by being in this company?

Now, for small businesses, the biggest value is that someone gets so much more scope than they would have at a Fortune 500. So let’s say you are running a clothing brand, and you are hiring someone to be, you know, designing, you know, heading up design or creative direction. Or let’s say you’re hiring a, you know, a creative director, and you run an agency, graphic design agency, or a branding company or something like that, where you’re hiring someone to be really a creative leader.

In your team, in your business, that person gets to run the entire department. That person gets to be the, like, thought leader. They get to have their ideas. Yeah, maybe you’re going to have some oversight, but this person’s level of ownership and leadership they get to have is, I don’t know, 10 to 100 times bigger than they would have at a large corporate company. Now, I worked at Apple in the design human interface design team. This is really the central design team in all of Apple.

It creates iPhone, Mac. It creates, you know, Siri, watch. All of the core visual experiences are done in that design team. You hire a senior level designer, especially an art director or design lead. Yeah, that person’s going to be making $200,000, $300,000 plus at Apple. That person, the level of ownership they have is going to be for, like, 1% what you would be able to offer this person in your role. Now, if that person wants that $200,000, $300,000, they can take that skill to Apple or somewhere else and work there.

It’s an incredible place to work, and it’s also a place where if you are working in a large organization like that, there’s reviews and approvals and meetings and all sorts of stuff that they may or may not want to deal with. If you’re anything like me, you’ve had those nights where you wake up at three in the morning wondering, gosh, are people working on the right things? Or what’s the status of that project? And obviously, you can’t email folks at that time.

But the tools you’re using, ClickUp or Asana or Slack, it’s just too detailed. You need a bird’s eye view. Enter the snippets template. At the end of each week, your team member fills out the highlights from the week, any places they’re stuck, and the top parties for next week. So you’re never wondering, are folks working on the right things? Are there things that they haven’t brought up that really should be on my radar? And most importantly, what wins can we celebrate as a team?

Grab your copy at liagarver.com slash snippets. What I want you to think about, though, as a leader is you, as a small business owner, as an agency, as a, you know, whatever you are, aren’t trying to go head to head with Apple to say that you are going to be giving that person that same, you know, like sort of compensation expectation. You didn’t say that. So the person putting that on you is actually sort of a misunderstanding of actually what the job scope is, in my opinion.

Right? You’re not saying, hey, you know, you’re saying to them, if you want to take this over the other job that you had available to yourself, it is because you want X, Y, Z. It’s because you want that scope. It’s because you want to be a leader. It’s because you want to have the autonomy with decision making. It’s because you don’t want to have a million approvals. It’s because you want to be able to X, Y, Z.

And it’s, yes, it is great if you want to work in a fortune 500 company and have whatever. That’s a choice. But the choice is the team members. It’s not for you to try to match that. And this is a strong opinion I have. You know, I have made moves in my own career where I took a lateral move, pay wise, or even left, you know, went from one role to another where I had less money but more ownership because I chose that I wanted that for myself.

Now, it wasn’t the company’s job to make that up to me. Like, I made the choice to change roles. So when you’re feeling like, ah, I don’t want to lose this person. I, you know, I really, I need them. But this, I really worry about you deciding that this one person, first of all, is the only person in the whole world that could do this job because it’s really not the case usually. And two, that you are setting up a dynamic with this team member that they can ask for something that you’re really on a limb about, and you’re stretched, and you’re agreeing to it, and you are setting yourself up to, like, be like, every freaking move that person makes, it better be right because I’m, like, breaking the bank to pay for them.

The expectation you have when you get in that situation becomes very high. It becomes very tense, very stressful. I’ve seen it in so many of my clients. They go on a limb. They make a senior hire that they feel like they really can’t afford. And when they’re, like, watching the person like a hawk, like, you better not screw this up. That is a lot of pressure for you. It’s a lot of pressure for that team member.

It makes it really hard to onboard because you feel like you don’t have time to really do it. They got to be delivering immediately. I think we, we’ve got to wrestle with that. You’ve got to think about what is your appetite? What is your risk tolerance? Now, I’m going to say something that kind of contradicts this just to be part of the conversation because it’s real talk, and we talk about all the things we got to talk about.

We also have to take risks when it comes to hiring. There are no guarantees. Someone reached out once. They’re like, hey, Leah, we want you to come in and help us, you know, map out our process for hiring team members to guarantee they will work out. And I was like, no can do. This is humans. We can’t guarantee anything with humans. I said, I can come in and I can map out airtight process so that you have de-risked it as much as you can on your end, and we designed that, and their next three hires were phenomenal, so win.

But I said to them, we can’t guarantee that you will, like, love this person forever or that they’ll deliver on things as the job evolves and as the market changes. Like, that’s not realistic. So I’m saying it, and it might hit hard, like, there are no guarantees with people, and so that’s a risk in and of itself with hiring. The other risk is really when we want to grow, when we want to hit that next level, we will have to leap and the net will appear sort of thing with big hires, with big moves.

And I have a client that recently hired a senior role to kind of move into this, like, president role over their company, and she was game-changing with a matter of weeks, had up-leveled their way their team was tracking work, was measuring, was driving their strategy, was measuring all their metrics. She had transformed it, and the team was so excited about that, not threatened, the team member, she was such a great fit that everyone was really receptive, they wanted to learn from her, and this CEO said, oh my gosh, like, this was literally the best move we had ever made.

And she took a risk, she went on a limb, the person is very expensive. So it’s not a yes or no, it’s thinking to yourself, what is my risk tolerance, what appetite do I have for this? Is it a role that we have no competencies in this, and so we really need this person to come and, like, build it from the ground up? That might be kind of closer to garnering that that fortune 500 salary, maybe it is.

But what else can you be offering that person? Because one thing that you can offer, you know, as a small business, you can offer all sorts of things, right? Scope, leadership opportunities, you can offer them equity, you can pay for performance, you can have commission, I don’t know what it is. But think about your business, you have so many levers outside of salary that you are going to be committing to on an annual basis, and I think where we can get stuck is we look at a number, we look at our P&L, and we’re like, well, I can’t do this, what if this, what if that?

We’re going to need these senior people to unlock wherever our business goes. But at the same time, we want to be deciding that, we want to be saying, what am I willing to invest? What can I sustain? What can I sustain on a year that’s, like, flat, or actually not growing, right? What can I sustain long term so that I don’t have to lay off other folks? And so if someone comes in, they go, I can only do this if I get, you know, 200 grand and 500,000 stock or something that you’re like, what?

If you can’t do it, there’s a misunderstanding of what is, what is the growth path and what is the compensation would be at a small business or a startup? And that’s okay. Again, I said it, I think there’s a, you know, there’s not like an infinite amount of people that can do every role, but to not get fixated on one person that had some good, you got a good interview, you think they’re going to be great, they have a good track record, like they’re the only person in the universe that can do this thing for you.

Because when you sign up for that, and then you feel like you really got overextended on the salary, and then you’re a little bit feeling buyer’s remorse, like that cycle’s no way out. No good. Okay. So we want to avoid that. And that actually takes some self-awareness. Takes thinking about, okay, what do I need to talk about? What goals do I need to set with this person so that I feel comfortable? What metrics of success? What am I talking about?

Like, how do, how am I measuring their outcomes? Those are the kinds of things you want to figure out when you go on a limb. Okay. So lots to think about here. This is one of those that I think it’s a lot dependent on your team, but it’s about, you know, thinking about what, where am I in this? How am I really making sure that the full, full suite of value and options, the full kind of spread is laid out so that we’re really being clear what you get when you join this company.

It is not only about dollars. Dollars are important and I want you to be paying your folks well, always. That is always my goal. And I think we can get really stuck on that and we don’t paint the full picture about what our company offers. All right. See you next time. Thanks for tuning in. And I hope this podcast makes leading your team feel just a little bit easier. If you liked this episode, check out my most popular tool for staying in the know of what your team’s working on without having to micromanage at liagarva.com slash snippets.

And if you’re looking for more support for yourself as a leader or for the team you’re managing, don’t hesitate to reach out at liagarva.com. See you next time.