How to Know if You're Actually Ready to Hire (Not Just Overwhelmed)

There seems to be some uncertainty amongst many small organisations about when the right time to hire a new person is. I wanted to share my views on how to know. I’ve spent quite some time studying systems, organisational structures, and design, and together with my experience working at small companies, I have opinions. Below is the framework I wish more new founders used before hiring.

Why hiring isn’t always the answer

It might feel that the most obvious reason to hire is when you or your team start to feel overwhelmed, work doesn't get done on time for several months in a row, and/or people are constantly mentioning unreasonable workload and expectations.

Or is it?

Not necessarily, and here is why: adding a new person doesn't guarantee that the overwhelm will disappear. According to Brooks’s Law, each new hire not only increases capacity, but also makes the overall system more complicated. Each time you hire someone new, you can expect additional points of communication, meetings, management, onboarding, decision-making, risk of work duplication, coordination overhead, and handoffs.

Have you heard of Dunbar's number? It's an idea that humans have a cognitive limit on the number of meaningful social relationships they can maintain. And while Dunbar's research has nothing to do with organisational design, it gives quite a useful way of thinking about why companies become so much more complicated as they grow.

A 5-person company isn't simply a smaller version of a 50-person company. This is because at 5 people, everyone knows what everyone else is doing, context travels easily and informally, it's easy to have direct conversations with each other, overhear things, and you don't need anything complex to manage anything. At 15 people, things start to get complicated. At 50, you can't expect people to know who is doing what, how, when, and why anymore. It gets more and more complicated as the company grows, and you need to start building complex systems, just to function and communicate properly. That includes proper documentation, processes, communication systems and channels, decision-making frameworks, knowledge management, etc. Now, to be clear, I’m not saying that a company becomes complicated once it hits a particular number of people. All organisations are different, but if you've worked in companies of different sizes, you'll see that the more people work there, the more complex systems and processes you need to follow.

So hiring a new person is not just about gaining more capacity. It can make things unexpectedly more complicated. Some small companies realise this after the fact, when they notice that everything that worked quite well before suddenly no longer works, and everyone is frustrated.

So before hiring a new person, identify the organisational problem you're aiming to solve. Is the problem more work that's increasing? Is it capacity? Capability? Coordination? If your problem isn't capacity or capability, then hiring is probably not the right decision yet.

To put it simply, you can think about it this way:

Capacity problem → probably hire
Capability problem → hire/train/partner
Coordination problem → redesign how work flows and how people coordinate
Process problem → simplify, automate, or even eliminate
Knowledge problem → document/educate/train
Ownership problem → clarify decision rights

If you decided that you definitely need to hire because it’s related to capacity and/or capability, then read on.

Purpose → Money → Organisational Map

The ideal way to start this process is with purpose. What is this organisation here to do? Who is it for? What do you want it to make possible? And, importantly, what do you not want it to become?

You're most likely not just designing a company that can do more work, but something that can fulfil its purpose in a way that makes sense. So the structure, roles, and work should all support that purpose.

The trick here is to imagine your company fully realised. The version of it that does what you set out to do, at the scale you want it to reach. If you expect to grow to thousands of employees, though, then scale it back to something you can realistically envision from where you're right now, without going fully into a fantasy world, where you're just guessing. In this case, you can envision where you see your company in the next 3 to 5 years, for example.

Once you know the purpose, you can start thinking about what the organisation needs to make it financially viable. And it needs to be done early. Before you start panicking that you don't have time to think, do, or play around.

Then think about where the money is coming from. The answers will dictate the entire shape of your organisation, because every box you draw is a commitment you make to pay for it.

Let's do some very basic maths here quickly: say you have a 20-person education business, and you pay an average of £65,000/year per person (incl. taxes, pensions, tools, etc.). That's £1.3 million a year in people costs alone. You also don't want people costs eating everything you earn. So let's say you aim for them to sit at around two-thirds of revenue, leaving room for software, office costs and actual profit. You've just committed to finding around £2 million a year. That's about £100,000 of revenue per employee.

Your organisational map can look very different depending on your model, and three education companies of the same size can look nothing like each other.

For example: if you're selling to individuals, then your organisational map will be dominated by marketing and teaching as you'll need to refill the entire customer base every single year (e.g., 1,300 new people every year paying for a £1,500 course).

If you're selling to organisations, then it may need to be dominated by sales and account management, and maybe even a finance department as you'll need to do the invoicing, chasing, forecasting, contract writing, etc. You'll need fewer clients paying much larger sums for the courses each year, but you'll need to invest much more time to land and keep them.

If you're selling a self-serve product, then your organisational map may be dominated by content production and engineering, as you'll need to acquire a lot of customers and keep creating new courses to retain existing customers.

Another question to ask yourself is whether your delivery grows each time revenue does. If it does, growing gets you more money, but the workload never gets easier. Every extra £100,000 of revenue needs another slice of a person to deliver it, so your margin stays exactly the same. You've probably seen companies that are always busy, constantly hiring, and somehow no better off. That's why. And it's why hiring doesn't really fix it. And there is another related trap - if you suddenly get more revenue than expected and have no capacity to deliver, you may hire a new person, but then have nowhere to put that person after the delivery happens.

The situation for charities and non-profits is a little different, and, I believe, more complicated. Charities and non-profits are not created to generate revenue; they exist to solve very specific problems. As such, most grants are given to projects solving these problems specifically, not everything else is needed in between, like finance, ops, or HR. So you'll need to work out which of your boxes you can legally fund through grants, and how much unrestricted income you'd need to cover the rest. Then design the fundraising side of the organisation to go and get it.

In short, know the purpose, gain clarity on where you expect your money to be coming from and how much. Then, start drawing your organisational map. I'm using "organisational map" rather than "org chart" here, because an org chart usually shows people and reporting lines, and I'm aware that it won't work for everyone. I'm more interested in mapping it more broadly: the functions, roles, areas of ownership and connections that need to exist for the organisation to work well. In some organisations, that will eventually look like a traditional hierarchy and thus an org chart. In others, it might be a much flatter structure, with people holding multiple roles or teams sharing responsibility.

Quick definitions: a function is a piece of work that has to happen for your organisation to do what it's trying to do, no matter who's doing it, how many people are doing it, or what you decide to call their job title. For example, sales, finance, product, customer support. Roles, on the other hand, are how you package that work into a coherent set of responsibilities that someone can actually own and understand. One person might hold one role, several roles might sit together in one job, or a role might be shared across several people. The important thing is that the work and ownership are clear, not what you call the person doing it.

So consider first every function, every role, and every area of ownership you think will need to be filled for your envisioned company to function well. Not just who is doing it today, but what needs to exist for the company to work the way you want it to work. The perfect version and the perfect team. Attach the total budget you can afford to each function/role and check that it aligns with the money you expect to secure.

Then write your name and your teammates' names against the functions and roles that are currently covered by someone, formally or informally, and leave the rest blank. Don't worry about reporting lines or job titles yet. The aim is to see what is covered, what isn't, and where ownership currently sits. This will be your hiring roadmap, showing you not just where the next hire should go, but where all your hires should eventually go - in what order, at what stage of growth, and for what reason. This will also help you ask whether the function/role needs a person now or whether it will only need one later.

How AI can help you stress-test your thinking:

After you’ve done your initial thinking, and if you don’t have anyone with experience to talk with, you can use AI to help you with this process. Start with your company’s current state and your vision, then let AI help you build out the full picture.

AI prompt - Step 1: Pressure-test the money

This prompt will stop you from designing a company you can’t afford. Do the rough maths yourself first, then use it to check whether the model can actually produce that number.

"Here's how my organisation is funded: [describe your model, who pays you or funds you, how much, and how often. If you're a charity, split this into restricted and unrestricted income]. I want to get to [X] people. Work out with me what revenue that headcount would require if people costs sit at around [two-thirds] of revenue, and what income per employee would need to be, and how much of my funding is actually allowed to pay for staff outside project delivery. Is that realistic, and what would have to be true for it to work? Then tell me which parts of my delivery grow every time my revenue grows, and which don't."

AI prompt - Step 2: Map the whole company

Draw your own organisational map before you ask for one, otherwise, you'll just adopt whatever the AI gives you, and it might not be the one you actually want. Then compare, and pay attention to what it included that you forgot. If it missed something you have, just tell it. Try to come to an agreement on the most credible map.

"I run a [describe your company: what you do, how many people, what stage you're at, your revenue/funding and current costs]. Here's what we're trying to become: [describe your full vision]. Help me build a complete organisational map for the company I'm becoming. Not just what exists today, but every function and role that needs to exist when we're fully operational. For each one, give me a plain-language description of what it owns and why it’s important. Then tell me whether it realistically needs a full-time person, could be outsourced, could be handled by better systems or automation, or is a coordination problem that hiring wouldn't fix. Map functions and roles, not job titles. Then attach an estimated annual cost to each function/role (whatever you decide to use), total it up, and tell me whether that total is affordable against the revenue I said I could reach."

AI prompt - Step 3: Find the gaps

Again, do this one yourself first. You know your team's strengths and weaknesses, and all the context AI doesn't have, so your version will catch things that AI’s version can’t.

"Here's what we have today: [describe your current team and what each person covers. Write names against every box someone is already covering, formally or informally, including yourself, and leave the rest blank]. Which of the blank boxes, and which of the boxes I'm covering myself, are the highest risk for a company at our stage? Which ones, if left as they are, will most limit our growth or cause the most problems? Sort them by risk, not by how uncomfortable they might feel to me."

Remember: a function or a role you’re covering badly in the evenings, because you don’t have the time, is probably a gap visible to everyone else except you.

AI prompt - Step 4: Decide what your next hire should be

Not every gap needs a hire. Use this prompt after you’re clear about the kind of problem you're actually trying to solve with your organisation.

"Given those gaps, what should our next hire address, and why that one before the others? For each gap, tell me whether it's a capacity problem, a capability problem, a coordination problem, a process problem, a knowledge problem or an ownership problem, and only recommend hiring for capacity and capability. For the rest, tell me what would fix it instead. And if no single function is big enough for a full-time person yet, tell me whether there's a collection of fragments from different functions that could be packaged into one sensible role."

I particularly like the last sentence in this prompt. When you're still small, you might not need someone full-time on one function yet. What you might need is a role that pulls a slice of work from a few different functions at once, none of which are big enough on their own to justify a specialist, and you might be better served by a generalist who can handle a wider variety of things and not mind it.

⚠️ Don’t let AI decide for you here; you know your company better. Take the advice and insight, but run it through your reality first, and adjust as needed.

Map the work (including the invisible stuff)

Let’s say you now have a pretty good idea about the person you need to hire. And let’s say you decided to hire someone into a specific function. The next step is to list every task, responsibility, and outcome that belongs to this function. Include the invisible things as well, such as the coordination, the communication, the judgment calls, and all the things that happen at odd hours because someone picks them up informally. Try to be as thorough as you can.

Useful questions to ask yourself:

• What is currently not getting done that should be?

• What is getting done badly or inconsistently?

• What falls through the cracks when everyone is busy?

• What would happen if this function simply didn’t exist?

• What do we actually need this new person to produce?

AI prompt:

“We’re a [describe company size and type]. The [function/roles] we’re looking at is [describe the function/roles]. Here’s everything we think needs to happen in this area: [provide a complete list]. What are we missing? What do companies at our stage typically underestimate about this function or these roles? What coordination, communication, judgement calls, or other tasks have we missed?”

If you decided against hiring into one whole function and instead designed one role pulling from several, map each fragment of that role separately.

I fully appreciate that clarity isn't a luxury that all organisations have. Some organisations are, in fact, built around work that involves a lot of uncertainty, making it nearly impossible to map the workflow down to individual tasks because nobody really knows the exact shape it will take. In this case, focus on designing the problem space, decision rights, and desired outcomes instead. You can determine the rest afterwards, after you have more clarity.

Eliminate the waste (before you hire)

If you’ve already spent a few years in your organisation, you’ve probably noticed that some work there exists out of habit, historical accident, or someone’s preference. What I mean by this is that probably not every task serves the organisation’s overall purpose. So, if you’re hiring someone to cover the existing tasks, check first whether that work should be done at all. When I was learning Lean principles in my Lean Six Sigma course, it talked a lot about unnecessary waste and identifying and eliminating non-value-adding work. So for each workflow you mapped, ask yourself:

• Does this produce a result that matters to the company’s purpose?

• Would a customer, team member, or the organisation notice if this stopped happening?

• Is there an active reason this still happens, beyond the fact that it's always been done this way?

Anything that received a “no” to these questions is a good candidate for elimination. There is absolutely no point in hiring someone to do this unnecessary work that shouldn’t exist in the first place. First, it’s expensive for you. Second, it’s demoralising for the person you hire. And the problem gets worse, because now you’ll have a person whose job depends on the unnecessary work continuing.

Adding a new stock (a person) to a system (your organisation) doesn’t fix structural problems in it. If the function is already broken, a new hire will inherit the broken function to produce work that is not actually needed. So eliminate what’s not needed first.

However, not every activity that doesn’t produce immediate output or is difficult to measure should be eliminated. Leave organisations human. Allow some work that exists there to create conditions for meaningful and valuable work to happen later. Group conversations, knowledge sharing, catch-up meetings… Don’t overoptimise or you’ll create a sterile environment that nobody enjoys working in.

Automate what you can

After you (hopefully) eliminate some of the tasks and workflows, check if any of the things that remain can be automated. Simply go through the remaining items and ask:

• Is this repetitive and rule-based? → Probably automatable

• Does it require consistent application of a known process? → Probably automatable

• Does it involve judgment, relationships, creativity, or accountability? → Probably requires a human, so check what human involvement is actually required

• Does it require someone to notice something unexpected and respond to it? → Probably requires a human, but AI can help, so check what human involvement is needed

Things that are commonly automatable right now:

• Scheduling and calendar management

• First-pass screening of applications

• Routine email sequences and follow-ups

• Data entry and reporting

• FAQ responses and first-line support

• Invoice generation and basic finance tracking

• Social media scheduling

• Meeting notes and summaries

Things that still require a human:

• Relationship building and trust

• Creative judgment and original thinking

• Navigating ambiguity and new situations

• Emotional intelligence and empathy in interactions

• Strategic decisions with real stakes

• Accountability for outcomes

• Values modelling

• Culture building

• Mentorship and coaching (AI can do it, but it’s not the same)

If you get stuck or have a lack of knowledge when it comes to certain functions/roles, you can, again, ask AI for help. It may have more details on what automation tools currently exist and how certain tasks could be automated that you may not yet be aware of.

AI prompt:

“Here are the tasks we’re considering hiring for: [full list]. Which of these could realistically be handled by automation or AI tools right now? For each one you flag, suggest the type of tool or approach that would handle it, and how much it could cost. I need you to leave me with a clear picture of what actually needs a human.”

Review the final list, make sure that things you decided are automatable are actually automatable for you at your current stage. Some things might be possible to automate, but you may currently not have enough time, money, or resources to get them set up in a way that would actually work properly.

Automation or AI delegation, even if possible, may not always be preferable either. It’s very much task-dependent. You’ll need to be strategic and consider how you’ll need to divide the labour if you decide to use AI in certain workflows.

Effective delegation consists of:

• Problem awareness - your expertise, understanding of goals, definition of success, and identification of labour needed. Start by analysing the workflows and categorising them into areas of:
  - simplicity (tasks that are straightforward but time-consuming),
  - uncertainty (creative spaces where you need a collaborative thinking partner),
  - ignorance (gaps where you lack data and need information retrieval), and
  - critical judgement (areas requiring human intuition and final decision-making);

• Platform awareness - AI fields evolve pretty much daily, so you’ll need to stay on top of the best available AI systems to do your work. Think: strengths, limitations, and trade-offs of different models (e.g., speed vs depth, accuracy vs creativity), so experiment;

• Task delegation - only when you understand the problem and the workflow it’s supposed to solve, consider how this can be divided between AI and an actual human. You can:
  - automate (hand over the whole workflow fully if outcomes are clear),
  - augment (collaborate with AI systems to create more value than working alone),
  - assign to agents (let AI handle routine ops independently), or
  - keep human (reserve exclusively for humans if tasks or workflows require critical judgement).

Design the human role

After eliminating what shouldn’t exist and automating what can be easily automated with the resources you have, what remains is the scope of the human role. The role should contain:

• Tasks and workflows that need human judgement, creativity and/or relationships

• Meaningful enough tasks and activities to constitute a real job, not a collection of leftovers that no one else wants to do

• A clear connection to the company’s purpose (not just its operations)

If what’s left after elimination and automation is too small to be a full role, you have three options:

• Combine it with another under-resourced function to create a coherent hybrid role

• Bring in a part-time or fractional person rather than a full-time hire

• Acknowledge that this function doesn’t need a dedicated person yet, and assign it as part of an existing role with proper time and priority

If what’s left is substantial and coherent, then congrats. You know exactly what you’re hiring for, and why.

But now I want to briefly talk about meaning, as I think it’s important when designing human roles.

Years of research have shown that people find their work meaningful and fulfilling when they have autonomy, relatedness, and competence (Self-Determination Theory), so take this into account when you’re designing the role.

• Autonomy is the need to feel in control of our actions and decisions. People need to have enough freedom to choose how and when they work (so no micromanagement, excessive control, or forced structure - keep things supportive).

• Relatedness is the need to feel connected to others. Meaningful work should involve positive relationships, collaboration, and a sense of belonging with colleagues or a larger purpose. For example, maybe don’t promote/reward competition or anything that would negatively impact the relationships between your employees. Instead, let people focus on healthy collaboration, team goals, and mentorship.

• Competence is the need to feel effective and skilled. Help people master their tasks, see their progress, and receive timely feedback that helps them grow.

Then, there is a SMART Work Design model, developed by Prof. Sharon Parker. It highlights that in order to create a work environment that contributes to an organisation’s success, you should also make sure that the role is stimulating (involves varied, interesting, and meaningful tasks), allows mastery and autonomy, is relational (provides connection and support within the workplace), and has tolerable demands (isn't overwhelming, doesn't require work to be brought home, and has consistent expectations). This will keep your new hire engaged and satisfied as long as nothing else is getting in the way (such as leadership problems, culture, or lack of organisational hygiene).

Moreover, don’t just think about responsibilities. Think about decisions that your new person will have authority to make within their area of ownership without asking someone else. People who have lots of responsibility and little to no decision-making authority will create dependency and take away time from you and probably your team, which will reduce their effectiveness. For example, can they change the process? Can they reprioritise? Can they change timelines? Bring external support? Clarity about what someone actually owns (without needing to ask anyone else) matters greatly for effective work.

I’d also say that you should resist making the human role as efficient as possible. Not everything needs to be measured or have a number attached to it. This is absolutely demoralising, so if you’re already automating a reasonable chunk of work, let humans do human things. Leave space for flexibility, thinking, and relationship-building, but provide enough structure that the person doesn’t feel disoriented or confused about what’s expected of them. Role ambiguity and role conflict are not just mild irritations; research shows that they produce real, measurable psychological strain. So if you think it’s ok to give a new person some minimal guidance on the first day and then let them figure things out on their own, it isn’t.

Design the systems

This one might appear a bit extra for many, but if you have the luxury of time (or your team does), this can be very helpful for both the company and the new hire.

You’ll have an expectation of how certain things in the function or role you’re hiring for should be performed, and no matter who you hire, you’ll need to train someone up to meet your standards. The worst thing (and it’s sometimes inevitable due to lack of time and resources) is hiring someone into a function/role that has no systems or documented processes to run it. It will be stressful and disheartening for the hire most of the time, and they’ll spend more time trying to figure out how to survive in their new job than actually doing the work and bringing their best skills and talent that you hired them for.

Create something they can use to start with. Do it imperfectly. Do it quickly if you need to, but give them something. They can improve the systems and processes as they learn what works and what doesn’t, but don’t throw them into the deep end and expect them to swim. I hear the ‘sink or swim’ analogy in small business circles often, and I really don’t believe that’s a good approach unless you hire someone who is there to build every single bit from scratch, and that’s literally the strength you hired them for, and what drives them.

You’ll know you’re ready to hire (with confidence!), when you can clearly answer what specifically this new person will own that isn’t currently being owned well and why.

The framework: your hiring checklist

To summarise the essay, it looks pretty much like this:

Know your purpose → understand your financial model → map the whole organisation → map the work → eliminate what’s not essential → automate what you can → design a human role from what’s left (and try to make it meaningful) → design systems around the human role.

I know the essay was long (I feel it’s justified), but the main thing I want you to take from this is that hiring isn’t just about adding one extra person to your team. You need to design a system, even if it’s not yet perfect (which is hardly ever the case anyway). Start with clarity and resist hiring until you can answer what this new person will own and why it’s important for your organisation and its purpose.

Thank you for reading. I hope this was helpful!

Lina