Your Growth Can Depend on It

Most small business owners will agree the quality of the people they hire is critical and can help make or break their company. It however, is not an easy task to find and hire the right person, particularly if you have a limited budget. Here are some things to think about to make it a more successful process. First there is no magical formula, but I believe the entrepreneur running the company should be fully involved in the process.

HIRING

Before you begin to look for the right hire for your company, ask yourself a few questions:

1. What is important to the success of your company? Whatever your answer, your hire should possess the qualities or skills that can lead to your success.
2. What will the person’s responsibilities be, whom will they report to, and how will their performance be measured?
3. What authorities will your hire be given? You can’t really hold them responsible for an activity or project unless they have the authority to carry it out. Many entrepreneurs have difficulty giving up authority. They need to learn to do so to grow and to accelerate their employees’ growth.

WHEN TO HIRE

1. When you can afford to.
2. When certain skills are required for the company to advance. These skills can be knowledge or relationship related.
3. When you have explored the feasibility of outsourcing the functions or skills needed.
4. When you as the CEO don’t have the time to do the important things critical for the company’s success.
5. Make sure your company’s sales surge, which normally initiates the hiring process, is not a temporary blip. I would rather wait and have everyone work overtime and pay bonuses before I make permanent hires and discover the sales gains are temporary.

HOW TO HIRE

Your choice is to use a headhunter, which has an expense tied to it, or do it yourself. I would explore the headhunter’s cost, expertise, reputation, and guarantee. If you do it yourself, here are some thoughts:

1. CEO should be involved. If you already have other people in your employ, use at least one other in the process, depending on the position you are hiring for.
2. Ask for and check references. This may seem to be a waste of time as you figure the person will only give you sterling references. This is not necessary true. Some of the people you call may not want to answer your questions for fear of being sued. I would describe the responsibilities of the potential hire and ask the references if this is a good match, based on their experiences with the person. Listen carefully to the answers and non-answers.
3. Look for upbeat, positive people, collaborative, have desire to learn. They can be smarter than you and different than you.
4. Do more than one interview with the promising candidates.

This will correct for a good or bad day on your part as well as the prospect’s.

MOTIVATE

One of the most expensive costs you will incur is a high employee turnover. So, once you hire someone you want to motivate them to be happy and proud to work for you, which will help maximize their contribution to the company. Here are some things to think about in this vain.

1. Praise people for jobs well done. Many people are quick to criticize for a poor job but never praise for good performance. It is important to do so as most people do not have money as their main goal in their job. They want to feel they contribute to the company.
2. Teach. Good employees want to improve and learn. When your company is small, the CEO should be involved to some extent in teaching everyone on some level. It can be about your company’s products, the industry, certain skills, how to learn, working with others, etc. You might send some to seminars or encourage them to take some evening courses. Pay for these if possible.
3. Communicate. Each employee should be updated on the company’s goals and the current status in achieving them. They should have their individual goals and know how they advance the company ones. A big part of communicating is the desire to LISTEN to employees’ questions, concerns, and suggestions. You don’t have to agree with them. Listening takes some effort as there is never enough time in the day of a Small Business owner.
4. Specify Rules. People want rules in their life. They should be told what the company expects of them. Ethics, treatment of customers, civility with each other, no office politics, acceptance of gifts from suppliers, etc.
5. Create an Environment where creativity and innovation can flourish. Don’t say you have an open door policy if you don’t practice it. The company founder needs to work at convincing employees to be honest and speak up with their ideas and problems. Their natural inclination is not to. Everyone in the company has something to contribute including the receptionist who I like to call the “Director of First Impressions.” You might think of periodic off-site meetings on a non-work day, where everyone can listen and participate. A rough agenda should be created and distributed in advance. A Christmas party could be good but can backfire if alcohol is served. Maybe a Thanksgiving party or a celebration dinner of landing a new big account or achieving a goal All these and other get togethers build a high morale and encourage people to work together as a team.
6. Promote from within. This should not be a hard and fast rule, but if all things were equal, I would always go with a current employee for a promotion.
7. Compensation. This is always a tricky issue as everyone always seems to know their co-workers salary. Also, young companies in many instances can’t afford competitive salaries. However, if you have a proven star in your company and you feel they are important to your future, approach them before they ask you for a raise and offer them what they are worth. It could be in cash, new benefits, or stock options.

FIRING

I always found the act of firing someone was worse than a root canal session with my dentist. When I interviewed 27 Entrepreneurs and asked each one what they would do differently in their successful business climb, a majority said they would fire people sooner than they did. Most employees know who of their fellow workers should be terminated. It is not a pleasant task to fire someone yet it is important that it be done or you will begin to lose your good people and decrease the productivity of most of your work force.

I would talk to someone who was doing a poor job before firing them and point out your problem with them and even offer some advice on how they could rectify their situation. If they can’t, then you must fire them without further ado.

You also might seek the advice of an attorney on the proper steps to take before terminating someone to avoid being successfully sued. We are a litigious society.

I’m sure there are many other suggestions or considerations in the hiring and firing process. The ones offered here are from my personal experience to get you thinking about an important aspect of your business growth that you will sooner or later have to deal with.