From Resume to Retention: Engineering Hiring as a Strategic Advantage
Solving CTOs Engineering Hiring Challenges
👋🏻 Welcome to Lead and Scale, the newsletter for CTOs and leaders navigating the complexities of scale-ups. Last week, in Your First 60 days as a CTO, I mentioned how you would probably face significant hiring challenges. Today, we'll explore the most critical ones, and how you can address them to build a stronger technical organization.
My first experience in hiring at scale was a nightmare. We just started the hyper growth phase, didn't have a HR department yet, and most developers considered cryptocurrencies to be an unreliable market to work in.
As a first-time VP of Engineering, I didn't have an established process. What I did was sending cold emails on LinkedIn, and doing the screening process by myself. I used the VP title as an ego booster to facilitate initial contact, then had my engineering leads impress the candidates during technical interviews.
Even worse, as we multiplied the number of engineers in the company by 5 in just a few months, this ad-hoc process created more problems than it solved, from onboarding bottlenecks to inconsistent hiring standards.
Today, we'll explore the most critical hiring challenges I've faced in the past, and how you can address them to build a stronger technical organization.
You Don't See Hiring as a Global Strategy
Unless you have a strong HR team, there's a chance you don't see hiring as a global strategy. Most startups and scale-ups I've met considered hiring simply as bringing someone onto the company's payroll.
Hiring goes far beyond convincing someone to join your company. It starts when you decide to open a position and ends when the engineer leaves the company.
As a CTO, it's your responsibility to build a consistent hiring strategy that ensures proper alignment across your engineering teams. Here are the essential components to optimize the hiring experience:
A hiring roadmap: What, when, and where.
A well-documented process: All stakeholders follow scripted interviews and align on standards.
A documented onboarding program: Enable objective progress assessment, and know when to part ways.
A transparent career path: Provide perspective to strengthen retention.
An effective offboarding process: focus on the handover and backfill more than on closing someone's accounts.
💡 Tip: create a salary grid. Not everyone is comfortable talking about money. Having a salary grid ensures fairness between candidates while aligning compensation with impact and seniority.
Your Hiring Roadmap is not Aligned with the Business
Every year, around September, you establish a hiring budget, stating which kind of engineers you'll need to add, in which team, at a given salary, and when you'll need them. Then, expect both HR and finance to religiously stick to the plan for the year to come.
Unless you're in a corporation with long-term visibility, you're doing it wrong. This isn't building a hiring roadmap—at best, you're trying to guess what the company will look like in 3, 6, 9, 12, and 15 months from now.
To build an effective hiring roadmap, you need to talk to the business first, then answer the following questions:
What is the target growth, per quarter?
How does this growth translate to new users, markets, and product requirements?
Where do you urgently need to hire to address current engineering gaps and backfills?
Do you already have engineers who can transition to teams that need additional headcount most?
Now, you're ready to translate your business needs into hiring targets:
Be generic: Assign new headcount and expected seniority levels to teams without specifying particular roles or technologies. "5 mid-level engineers in the backend team" gives you much more flexibility than "5 mid-level Django developers."
Reforecast monthly: Compare your current numbers with business performance and adjust hiring targets accordingly. If you need additional budget, request it, this often means your company is growing faster than expected.
Timelines matter: Depending on your location, expect 4-6 months between publishing a job description and onboarding a new hire, plus an additional 3-4 months for onboarding and ramp-up.
Remain flexible: Don't stick to the plan simply because "you'll lose this quarter's budget" as this creates more problems than it solves. Remember that "premature optimization is the root of all evil."
Your Hiring Workflow Makes Candidates Run Away
Building a hiring workflow is challenging. It needs to be complete enough to properly assess the candidate's skillset and culture fit, while being short enough to prevent candidates from running away screaming. Even though we've seen a shift in developers' hiring market since 2024, good candidates remain rare and know their value.
I've seen several mistakes during engineering hiring processes that drove candidates away, with dropout rates approaching 80%:
Your interview process is too long: Keep it short. You're not Google or a secret service requiring 8 interviews over 3 months, including meetings with company co-founders. Unless you're hiring for a leadership position or in a startup with fewer than 50 people, please avoid this one, it's cringe.
You give senior engineers the same technical tests as junior applicants.
Your technical test needs your candidates to take 3 days off to complete.
You ask basic technical questions to senior engineers.
You bring 10 people to interview the candidate. That's not a job interview; that's a trial.
You're being too vague whenever the candidate asks questions, especially about compensation, work/life balance, and legacy code.
There's no defined leader in the interview process.
I personally value a short, 3 steps hiring process, over a maximum timespan of a week.
A screening call: The recruiting team assesses the candidate's basic skillset and culture fit. This requires having a technical recruiter who can determine if the candidate's answers match the expected technical knowledge.
A technical test or use case: For senior engineers, I prefer a collaborative (digital) whiteboard session where the candidate works with two future colleagues on solving realistic problems. This approach helps candidates feel they're already part of the team.
A deep-dive technical interview: Conducted with two engineers and a tech lead. This step isn't necessary if the candidate went through in the collaborative whiteboard session, but it's great for junior and mid-level engineers.
The reason I include 2-3 people in each interview is simple: it makes identifying red flags, debriefing, and decision-making more effective.
💡 Tip: Track at which stage of your hiring process candidates decide to withdraw or stop showing up for interviews. This data will help you identify and fix problematic areas.
Your Hiring Standards are too Low, or too High
Finding the right balance between hiring the first candidate who agrees to interview and holding out for only top-tier engineers is challenging. Companies often face a discrepancy between their ideal candidates, their budget constraints, and the actual skills required for the role.
You don't need rocket scientists to build a simple application the same way you won't trust a group of juniors to send you to Mars.
Consequences of standards that are too low can be devastating for a company:
You'll accumulate technical debt and make poor architectural decisions.
High performers' morale will decline until they eventually leave.
Knowledge gaps will slow down team progress.
Complex technical initiatives become impossible to execute.
You'll need to double down on management.
On the other hand, setting standards too high will impact your growth:
You'll struggle to fill open positions, creating severe hiring bottlenecks with direct impact on delivery timelines.
Your unrealistic expectations will lead to engineer burnout.
You'll miss high-potential candidates, negatively affecting your team composition and diversity.
So how can you find the right balance?
Instead of searching exclusively for top-notch engineers with perfect skill matches, focus on candidates with high potential. These individuals learn quickly, demonstrate enthusiasm for growth, and adapt more easily in fast-moving environments.
Implement regular calibration of your standards against current and expected outcomes. Don't fall into the trap of raising standards when outcomes aren't being met. First assess the root causes: throwing more people at problems rarely solves them.
Create a tiered hiring approach: not every role requires a senior engineer with a PhD. Develop personas for each type of position you need to fill, and evaluate these personas against your company's actual needs.
💡 Tip: Technical skills aren't the only criteria worth considering. Balance technical requirements with cultural fit and collaborative abilities.
You Have Too Many Juniors for Not Enough Seniors
Most startups make the same mistake: they save on salaries by hiring interns and juniors until they find PMF, then continue this strategy “because it worked until now.” As a result, you'll face a situation with an overwhelming number of junior engineers, while most seniors are those who started their careers within the company.
Your team members lack the experience to deliver high-quality code, fast. People with at one other work experience have seen different approaches and will likely achieve desired results more efficiently.
Teams composed primarily of juniors and employees whose only experience is within the company often develop a "We've always done it this way" bias.
There's a shortage of tech leads and experienced middle managers, meaning no one is available to teach juniors good engineering practices or mentor them.
To address these challenges, here's a simple strategy:
Develop internal talent: Identify people with tech-lead or management potential and mentor them before hiring externals who don't understand the company's internals. Once you've promoted a few people, you can start looking for external leaders.
Get hands-on with engineering practices: Establish processes, deploy tools, and conduct code reviews to raise quality standards.
Create a training program: Fill the skills and experience gaps by helping your engineers develop the capabilities they lack. Don’t hesitate to hire an external company to help you.
Balance your hiring: Start recruiting for senior roles to achieve the right junior-to-senior ratio.
Your company can't deal with underperformers (and slackers)
Firing people is extremely unpleasant, but it's part of a CTO's job. So I had to address it.
Keeping underperformers (or slackers) indefinitely is the best way to pull down an entire company, and many companies, especially young or small ones, don't know how or don't want to deal with this challenge.
Here are a few common (and terrible) reasons I've seen companies use to avoid letting underperformers go, putting the entire organization at risk:
"Hiring engineers is hard/expensive/takes too much time, and we're not sure we'll find a replacement": Keeping underperformers will drive your best engineers away.
"Firing someone will destroy the company's morale": Actually, letting an underperformer or a slacker go will most likely improve the team's morale by eliminating resentment.
The lead who hired them refuses to admit they didn't make a perfect match: When this happens, run away, you're in a toxic environment
"They used to be a top performer and have given the company a lot, so we don't want to be harsh": Sometimes, employees are lost for your company, and helping them transition elsewhere benefits everyone. Better to recognize this before it damages both parties.
Your Company Has a High Turnover Rate
Turnover is a necessary part of a company's journey, and engineer turnover is typically higher than in any other sector.
In Europe, the turnover rate for software engineers is 21%, which is slightly lower than the US, where the Bureau of Labor Statistics reports an average of 57.3%.¹
Things get worse after a merger or acquisition:
47% of key employees depart within a year of a merger or acquisition, 45% of software developers stay in their positions for only 1-2 years, while 69% remain for less than 2 years. Finally, 75% of acquired employees leave within the first three years post-M&A.²
If your company has an alarming rate of turnover, you're likely facing one of these fundamental issues:
1. Lack of engaging work, purpose, or growth opportunities
This is often the most straightforward issue to address. Make sure to alternate between BAU and R&D projects when possible. Delegate new technology exploration, and partner with HR to build transparent career paths.
2. Toxic environment, micromanagement, or harassment
This represents a systemic issue that must be addressed at the company level. Engage HR to assess the problem and implement solutions for quick wins. If HR prefers to maintain the status quo, hire an external firm to audit the company, or consider your own exit strategy.
3. Compensation issues
In my career, I've observed three distinct compensation problems:
Below the market compensation, with no other benefits: If you can't pay people what they're worth and can't offer alternatives (like innovative projects or QOL advantages), they'll leave.
No compensation alignment: Discrepancies in pay for same-level roles are the best way to make the lower-paid employees to leave, while the top paid become dissatisfied when they don't get a significant raise. Fix this by aligning compensation with impact and seniority.
Stagnant compensation: I once worked for a company that only gave raises when employees received promotions or changed roles. While understandable in a struggling startup, this becomes problematic in a company experiencing hypergrowth.
💡 Tip: Conduct exit interviews consistently—they reveal problems that might otherwise remain hidden.
Your Team has a Single Point of Failure
Twelve years ago, my former company was audited before an acquisition. The auditor bluntly told management:
If this guy runs under a bus, you're dead.
We had maintained the same single point of failure for years, with management accepting the risk.
How to identify a SPOF in your company:
They're the only one who knows how to run critical parts of the system.
You need to call them during their vacation to solve urgent problems.
They're too busy performing their SPOF's responsibilities to document processes or train others.
The official org chart shows which team they belong to, but in practice, they operate independently.
The day they announce their resignation, the whole company gets in crisis mode.
How to fix SPOF situations:
Some people become SPOFs deliberately, whether they're control freaks or trying to secure their position. They consistently find reasons to work alone and avoid sharing knowledge or code. Then, you don't (only) have a SPOF; you're held hostage by an employee.
Other people become SPOFs unintentionally, overwhelmed by workload until they don't realize they're putting both the company and themselves at risk. The first thing they need is a capable manager to help them recognize the situation and offload them from part of the burden.
Once you've identified the nature of your SPOF problem, take these actions:
Assign documentation to a newcomer: Have someone new to the topic document the processes. Don't assign this to the SPOF themselves, they'll leave gaps and shortcuts where knowledge is assumed. You want to ensure a newcomer could take over this part of your stack with minimal handover.
Automate repetitive processes: I've noticed that SPOFs often perform the same manual tasks repeatedly. Much of their time could be freed through automation, but they're too overwhelmed to step back and identify improvement opportunities. If they don't automate as a fear to step out of their comfort zone by taking over new topics, you have a deeper issue to address: this employee might not be at the right place.
Integrate the SPOF into a proper team: Most SPOFs are isolated or isolate themselves to maintain control. Deliberately integrating them into a broader team can both help them grow and allow you to better assess the situation.
When addressing SPOF issues, bringing in new talent isn't always the right thing to do. When possible, I prefer involving existing employees who already understand adjacent systems and have trust from other engineers, their ramp-up will be faster.
💡 Tip: when adding a SPOF to a new team is impossible, introducing a dose of pair programming is a good way to break their isolation and begin distributing knowledge.
This list of hiring challenges you can face as a new CTO is far from exhaustive. Reviewing all of them would require me to write a book, so I had to choose the ones I've encountered most frequently. If there's a topic you'd like me to address in a future issue, please drop me a message or leave a comment.
Thank you for reading. See you next Tuesday, when we'll talk about The False Promises (and Opportunities) of No-Code Apps and AI Code Generators.