Build vs Buy Talent: Cost the Hire and Mentor Work

Put Both Candidates on the Same Cost Basis

The model's Tier 1 salary is $50,000 a year. Applying its US burden multiplier gives $50,000 × 1.25 = $62,500. Tier 2 pay is $62,000 × 1.25 = $77,500, so the annual difference is $77,500 minus $62,500 = $15,000.

Burden is the modeled employer cost above salary, including payroll taxes, benefits, and insurance. Recruiting and training sit outside that multiplier. Keep them visible when comparing the first year rather than assuming loaded pay covers the whole commitment.

For an illustrative comparison, use those role salaries and the model's allowances for each hire. It budgets $5,000 for hiring and $2,500 per person annually for training. Adding the same allowances to both roles gives the following subtotals.

The $70,000 and $85,000 results are calculated subtotals, not independent model assumptions. They exclude any remaining commitments particular to your plan. Equal allowances leave the difference at $15,000; actual offers and support requirements can change it.

Before adding another onboarding line, check what the $5,000 hiring allowance already covers. Its model definition includes onboarding lost time. Replace an allowance with the relevant actual commitments when available and avoid charging for the same effort twice.

Describe the Work Before the Development Plan

Use the current queue and scheduled work to identify the capability missing from the roster. Specify which tasks the new hire must perform independently and which can be supervised. A development route is useful only if someone still owns the work while the learner develops.

The model directs work to the cheapest resource capable of doing it. Capability is part of that instruction. A lower-paid person who cannot yet own the required task leaves an assignment for someone else as well as a training commitment.

Use a relevant practical exercise to assess each candidate. Ask how they would investigate the problem and when they would seek help. Record what the result demonstrates rather than substituting a previous employer's name for evidence.

Calculate the Mentor's Available-Hour Cost

Name the mentor and protect the review time in the work plan. State what that person will stop doing or who will take it. A calendar cannot clone your senior technician.

For a hypothetical Tier 2 mentor, use the model's $62,000 salary, 1.25 US burden, and 1,660 available hours a year. The allocation is $62,000 × 1.25 ÷ 1,660 = about $46.69 per available hour. Multiply your own planned mentor hours by that rate to value the payroll capacity assigned to teaching.

This is an allocation across available hours, not a productive service-hour cost or an extra wage payment. It doesn't establish the revenue that would otherwise have been earned. Compare the allocated amount with the $15,000 role-pay difference while keeping those different meanings visible.

Existing payroll already funds the mentor's salary. If the plan requires paid cover or external instruction, budget that new cash commitment separately. Don't add the original salary again simply because some of its hours now go to teaching.

Record the learner's practice and supervised tasks separately from independent work. Experienced hires may need instruction on your stack and methods too. Price the actual gaps for each person instead of assuming only the junior will need a reviewer.

Approve Capability With Evidence

Use the standard stack as the base for the development plan, as the model requires. Identify the task the learner must demonstrate and the person authorized to approve independent work. A course can support that preparation without proving the person is ready to make a client change alone.

If a supervised exercise needs prompting, record what help was needed. Teach that part and check it again before changing the approval boundary. The model sets no universal duration for turning a junior into a Tier 2 technician.

I don't buy a growth hack that calls an unassigned review task a training plan. The mentor needs an actual assignment and the authority to stop unsafe work. Keep that responsibility visible when delivery gets busy.

Test the Choice Against the Board

What does this do to the board on Monday morning? With a junior, show who is available to review the work when it arrives. With an experienced hire, show which cases they can own and which responsibilities remain with the current team.

ExecSignal Advisory recommends examining recurring gross profit and fully loaded role cost instead of using recurring revenue alone as the hiring trigger. That is its published advice. Check the contribution available after existing delivery costs alongside the actual payments and cover your proposed hire requires.

My view is that the decision should start with the funded service need rather than the cheapest assumed first-year total. Training can be the right route when suitable work and teaching capacity exist. If you need independent delivery before you can develop it, assess and price someone who can demonstrate that capability.

• The service lead specifies the missing work and the capability required to own it.
• The hiring owner compares actual offers with burden and the commitments outside it.
• The mentor estimates practice and review hours and identifies the work being displaced.
• The technical lead defines the evidence and approval boundary for independent delivery.
• The owner confirms funding and any additional cover before making the offer.

Keep the selected candidate's first tasks and named reviewer with the hiring decision. Update the plan when demonstrated capability changes, rather than assuming the calendar has removed the need for supervision. The offer should fund a workable assignment, including the work of teaching it.