Thoughts On Hiring Employees

Nov 29, 2009

As a small business owner, whether you are growing or have lost staff, you are often under pressure to fill a position. I know I am. Under that pressure, and with plenty of other issues to take care of, we can tend to hire quickly out of convenience rather than taking the time to find the right person for the right reason.

It’s a delicate situation, and one I’m facing right now. In this article, I’ll talk about some of the considerations I take when searching to fill a position.

Jobs and Careers

First, let me say that I think a great deal of scrutiny has to be put into the interview. The goal of that scrutiny is to differentiate between someone who is looking for a job and someone who is looking for a career. Those are two very different things.

With a job oriented person, you can only expect a 9-to-5 work ethic, without passion or dedication to the industry, much less your particular company.

I think the career oriented person takes you down a completely different path. But, to find that person, you have to avoid hiring someone because it’s fast and convenient to do so. You have to avoid those scenarios like the plague because they will come back and bite you, and they have bitten me many a time. Whether it’s a cheap employee or an expensive employee, they must be good and good employees are not that convenient to find.

I’m lucky; half of my roster has been with me for 15 years, but it’s the growth that I’m having right now that I’m having a tough time filling. Growth presents those challenges because there’s a necessity that has come up that wasn’t there before.

It’s tempting to simply hire the next applicant, but remember, the wrong person can just kill you in the eyes of the public. Whether you’re a manufacturer or a tuner, expertise is critical. Consumers and business partners don’t care what your internal structures and struggles are. Whether they’re handling your accounting issues, technical questions or sales inquiries, the people you hire had better know what they’re talking about.

Interviewing

When talking to a potential hire, the very first question is, “Do you want a job or a career?” You have to link that question to age because there’s a huge difference in the circumstances employees of different ages are likely to find themselves in.

If they’re young and have a family, then they’re likely going to go through struggles with their wife, and other family pressures can take away from their ability to really learn. That’s important to consider, because a new employee is going to have a ramp-up time (learning curve), and that ramp-up time requires extra-curricular activity. If they’re too young and too light-footed, they’re going to want to spend every spare minute at the bar or mountain biking or whatever. They won’t really know what kind of commitment you’re looking for, and they won’t know how to gauge it.

If they are right in the throws of a starting and taking care of a young family, as a business owner, you have to be able to forecast the limited extra curricular time that they will have. However, they might also be more career driven.

Pay Expectations

Career driven is what you want, but you have to carefully consider you company’s salary policies along with the skill, experience and attitude you’re looking for in an employee. In today’s day and age, one of the biggest problems for the candidates out there for employment is their pay expectations. The cost of education has gotten so high that the educators themselves are feeding the students a prophecy of a $60,000-a-year earning as they exit school. So, many young people think, “I’m only one year into my 30-year career, and I should earn $60,000.”

They’re dreaming of their Hummers and jet skis that they want to put in their driveway. And all of us old folks here that have had to do it and scratch through and earn our way our to the top, it’s tough to really level the playing field as you’ve got a senior staff in the company.

Facing these situations, you need to educate the potential hire or current employee that more cash doesn’t necessarily mean a better livelihood at home. You need to convince them to buy into your company’s ideals, and if you can, you’ll have a much better employee.

Livelihood

As a small business owner, you’re going to be subjected to countless different scenarios by your employees. Sooner or later, you’re going to have a situation which I’ve just gone through where I had a key member of my staff, who wasn’t soliciting or looking for work, receive an offer. It was much more revenue for him and his family, and so he was forced to consider it.

Now, no employer wants to be pushed into a pay raise. They want to offer it and scale it, and especially if it pushes you outside your salary cap, you have to decide how you’ll manage it.

My personal findings for the last 16 years, the last five years and the last two especially-because it’s changed all along that timeline-is that it’s cheaper to invest in the right employee and keep them happy than trying to re-train and re-orient yourself with a new employee. The downtime for productivity in the shop, the overall net cost to the business (because of a drop in quality, a drop in production, whatever it may be), there’s a cost associated with all of that you can’t forecast.

I really thought it would be impossible to replace that key member because he got an offer that I couldn’t match because of our salary cap. But, I explained to him that if he jumped into this higher realm, which would have been the highest paid salary bracket for the industry, that employer would be looking to get a maximum return on their investment in him. That means that he wouldn’t have time to spend with his family, think about school for the kids and run errands at lunch. They’d have him behind a welding mask all day, every day, trying to get that hourly payment out of him.

That’s a good example of why, when you’re hiring, you need to separate career people from job people. A career-oriented person would buy into such a structure. A little bit of flexibility at the workplace is worthwhile to them. That helps them to manage their busy lives. They can manage their family better, whether it’s dropping or picking up kids from daycare, buying groceries or running other errands.

All of that versus a job-oriented person who just wants to get in and out with maximum dollar for his time spent. You need to find a way in your hiring practices to separate one from the other. You don’t want a water-cooler situation where the two ideals are being mixed. They’re two very different sets of goals that we’re talking about.

Return On Investment

Employees are your most valuable and trickiest asset to manage and grow. If you put money in the stock exchange, you can factor an average rate of 12 percent growth-with a couple of hiccups along the way-but you can always factor in an average.

There’s no way to do that with employees. You’ve got a mixed bag, and you need to identify the mix at the point of hiring, and then reevaluate the mix as the company goes through its growth stages.

You hire a guy when he’s 29, and then 10 years go by. Did he buy his house? Does he have one or more children? What are his stress levels? The rewards he needs have changed, but probably, the pay scale on the job hasn’t much.

Do you keep investing in him because he’s steady and constant? If you don’t check in on him, you’re leaving him open to prey from other companies. They might look at him and say, “He’s one of the staples that grew that company. What could he bring to us?”

Competition will hire out of your company, and then they’ll cash in on the skill of labor that you invested in over years. Also, there’s no chance to reinvest in short order to maintain the quality and the demand that the customer and the consumer have grown to expect.

That’s a problem that I have in my sales department right now. I’ve been interviewing up the wazoo, and I’m finding so many people in their early 20s to mid-20s. But, I’m looking for that right mix, somebody who’s going to give this company some time.

It’s not worth hiring someone from whom you can’t count on getting at least two years. If you don’t think there’s a possibility for a long-term relationship between their career and your business, don’t hire them. You don’t want someone that wants to travel and fly around or just isn’t sure what career path they want to follow.

The Team

When you do find the qualities you’re looking for, you have to be able to show employees and prospective employees what your company offers outside of dollars. If you only talk about dollars and hours put in, you’re only going to get hours put into the dollars offered.

I think that is something that the biggest organizations in the world can’t lose touch with. They can’t lose touch that it still takes a team. And a team isn’t a payroll digit. A team isn’t some nominal individual. It’s all a group, and if that’s something that you believe in, then that’s something that you have to sell first and foremost.