Capability and Capacity

When I was discussing the challenges of growing our business and hiring people, I said that our priority was to build the capability first and we can build the capacity later on. When I thought about this statement more, I realised that many organisations go through this challenge. Very often we have to take decision about hiring people in a given budget.

For example, the question that I was trying to address was whether to hire 2 people at entry level skills versus hire only 1 at an expert level.

With 2 people, it lowers our risk of failure (seemingly), it also allows us to regulate the cash flow.

On the other hand hiring one expert and having a cash outflow equivalent of two, increases the risks, if things don’t work out.

However the key question for me was more about capability vs. capacity. 1 expert gives us capability and 2 entry level skills gives us capacity. Based on the current needs I decided to go for ‘capability’ building.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: