By Tim Smith, Executive Partner, Stratfield Consulting  

As business leaders, we’re often faced with a common dilemma: should we invest in upskilling our existing employees or hire externally to fill a critical role? Each approach has its benefits, challenges, and ideal scenarios. The decision isn’t always straightforward, but understanding when to upskill and when to hire can make a significant impact on your team’s success and culture. We believe that it’s critical to leverage both strategies for growing your team.   

The Case for Upskilling 

Upskilling involves investing in your current workforce to help them acquire new skills and take on greater responsibilities. It’s a strategy that promotes loyalty and preserves institutional knowledge, but it doesn’t always make sense when evaluating your current team.  

When Upskilling Makes Sense: 

1. You Have High-Potential Employees: If you have team members who are motivated and capable of growth, upskilling can prepare them to step into larger roles.  

2. The Role Requires Deep Institutional Knowledge: For positions where familiarity with company processes, culture, or history is critical, upskilling internal talent can ensure continuity.  

3. You Want to Strengthen Retention: Employees are more likely to stay with companies that invest in their growth. Upskilling demonstrates commitment to their long-term success.  

Challenges to Consider: 

1. Time Investment: Upskilling can take time, especially for highly technical roles. Can your team afford to wait? 

2. Skill Gaps: Some roles may require expertise that goes beyond what can realistically be developed internally. 

3. Executive Skillsets: Oftentimes, more senior roles require someone who has demonstrated past success in managing and building teams.  

The Case for Hiring Externally  

Hiring externally brings in fresh perspectives, new ideas, and specialized skills that your current team may lack. It’s a faster way to fill critical gaps and can inject energy and innovation into your organization.  

When Hiring Makes Sense:  

1. You Need Immediate Expertise: For highly technical or senior roles, hiring someone with the exact skill set can save time and ensure immediate impact.  

2. You’re Navigating Change: If your organization is undergoing a transformation, bringing in talent with experience in similar situations can accelerate success.  

3. Fresh Perspectives Are Needed: External hires can challenge the status quo and bring innovative ideas to the table.  

4. Internal Talent Isn’t Ready: When no one in your current workforce is ready to step into a role, hiring externally ensures you get the expertise you need without compromising quality.  

Challenges to Consider: 

1. Cultural Fit: New hires may take time to adjust to your company culture, and misalignment can lead to retention issues.  

2. Finding the Right Balance Ultimately, the decision between upskilling and hiring depends on your organization’s goals, timeline, and resources. Here’s a framework to help guide your decision: 

• Assess the Role’s Requirements: Is this a position where deep company knowledge is critical, or does it require niche skills that your team doesn’t currently possess? 

• Evaluate Your Internal Talent: Identify high-potential employees who could be upskilled to meet the role’s needs. 

• Consider the Timeline: If you need someone to hit the ground running immediately, hiring externally may be the better option. 

• Align with Long-Term Goals: Think about the role’s impact on your business strategy and whether an internal or external hire aligns best with your vision.  

The Bottom Line 

There’s no one-size-fits-all solution when it comes to upskilling versus hiring. Both approaches have their place in building a resilient, capable workforce. By carefully evaluating your needs and striking the right balance, you can create a strategy that empowers your team, supports your goals, and positions your organization for long-term success.  How does your organization approach the upskilling vs. hiring dilemma?