I know the thought of having to hire new staff makes you squirm. After all I’m sure you’ve heard them, the horror stories of employees running a muck, going rogue or worse yet those that have gone to the dark side completely. If you’re in business for yourself, no doubt you’ve experienced a few of these choice delights of being an employer. I know we have.
The truth-is hiring the right staff is one of the most pivotal decisions you’ll ever make as an entrepreneur. If you get it right, your new staff will save you time, make you money and help you scale your business to greater heights. If you get it wrong however, trusting your business into the wrong hands can feel somewhat like Q handing James Bond the keys to his latest car. I’m sure we’ve seen enough 007 to know how that is going to turn out.
Hiring Staff – rainmakerS OR troublemakerS
If we have clearly established exactly the type of person we want to hire, the position we want them to fill and the skills that are needed in order for them to properly perform their functions, then we will have a better chance of ensuring the candidate we hire fits our need.
The problem is, in the hustle and bustle of daily business life, most entrepreneurs tend to hire out of desperation rather than deliberation.
So rather than have you struggle on working it out a piece at a time, we thought we would share with you our system for hiring, maintaining and developing star players for your team.
After all that’s what you really need. No coach in history looked at their team roster and said, “What I really need is some people to fill out the ranks and punch a time card.” No! Every coach tends to build his team around star players and performance athletes who can drive a successful team to greatness.
So here’s the process
Hiring The Right Staff
Step One: Start With The Need
This is where you, as the entrepreneur need to look at your organisation and diagnose the issue. Ask yourself, “What is it that I really need?”
Are you having issues handling customer service? Perhaps you need perhaps you need more customer service representatives.
Are sales flagging? Perhaps your sales force needs to be reinvigorated, retrained or retrenched. If your sales force is healthy and well but you simply want to grow, perhaps all you need are more salesman like the ones you already have.
If your back office is a jungle and you’re finding it difficult to get the data and reports you need, or you are finding your organisation unable to deliver as it should, then perhaps you need to revisit or expand your back office staff.
Whatever your issue is, the key is to identify it and work out exactly what you need in order to fix it. Sometimes you will need to hire anew, sometimes you’ll simply need to up skill or retrain your existing staff.
One pitfall to avoid is hiring to fix a symptom rather than the underlying problem. For example, if your back office is a mess due to poor internal policy and procedures (common in new start ups) than hiring a new staff member won’t fix the problem. You will simply be adding another moving part to the mess. If you fixed your underlying issue first you might find your efficiency grows and the new hire is not even necessary.
So always look for the root problem, not just the surface issue. Sometimes these issues are like icebergs. Most of the problem is out of sight below the surface of the water.
When it comes to hiring new staff, we always identify the role that we want them to perform first. This allows us to write the perfect ad. Naturally the perfect ad will be the key to hiring the right staff
Step 2: Writing the Perfect Ad for hiring new staff
Just as the right bait is essential to catching the right fish, crafting the right ad is the key to hiring the right staff, particularly if you want to hire capable staff rather than casual headaches waiting to happen. Using the information we’ve set out in step one above, we want to prepare an ad that speaks specifically to your requirements.
Use adjectives that clearly describe the type of individual you are seeking to attract. I often include words like enthusiastic, diligent, high achiever, conscientious, organised, excellent team member etc. For sales positions I often use terminology like tireless, or performance athlete. The reason we use these key terms is they serve as a filter. By setting a high standard, the lazy or unqualified applicant will see them and often simply not bother to submit a resume. This saves us time later when we are filtering through the resumes searching for our golden applicants.
In the current job market things are intensely competitive often you can get hundreds if not thousands of applicants for a single position. So rather than get swamped with unqualified applicants who will waste your time and energy in the sorting stage, you can discourage those who don’t meet your criteria from even applying.
This also has the polarizing effect of attracting those who do meet the requirements and will actually entice them because it portrays your workplace as the type of environment that they will enjoy and will thrive in.
Ensure your ad is distributed through all of the relevant channels. There are many highly effective websites such as Seek.com that will help you get great circulation for relatively limited cost.
Build a hook into your ad
Always ensure that you add specific directions in your ad asking applicants to do something in particular. I call these hooks. These hooks will help you identify employees who can read and follow directions (both relatively important skills in most fields). Any applicants that ignore the hooks or simply don’t follow the directions in their application can then be discarded immediately.
For example, recently we helped one of our clients hire a new bookkeeper. Using all the techniques we’ve described above we set out a careful advertisement. In the ad we placed several hooks indicating that the business used a particular accounting package, (Xero). Then further down the ad we asked any applicants to ensure their cover letter spoke specifically to their knowledge and expertise in Xero. It wasn’t a subtle hook.
Over the days that followed we received dozens and dozens of resumes. Using our hook I was able to quickly and efficiently sort through them. More than half included no reference to Xero whatsoever. These were swiftly discarded as it was a key proficiency for the job we were hiring for. In less than an hour I was able to take more than fifty potential candidates and narrow it down to the four people we would interview.
Once we have our candidates, it’s time to meet and interview them
Step 3: Interviewing New Staff
There are many keys to conducting an effective job interview. Remember the purpose of this interview isn’t to intimidate the applicant sitting in front of you. Rather you want to compare each of the applicants to the outline you prepared at step one and ascertain who will be the best fit for your company. Both skills and personality become important considerations. You want to use this interview to learn what you could not from the resume.
Remember some people naturally interview better than others, and it will be your job to discern who is truly capable of performing the role best and not simply who was the most conversational in their interview.
For this reason I always try to set my applicants at ease so that they relax a little and are more conversational. This way I can easily ask my questions and gain the insights I need. It is a lot easier to get the answers you need having a conversation rather than trying to interrogate a hostile suspect.
I always ask the following questions:
To start with, I asked the employee to tell me a little bit about themselves. The purpose of this is to catch anything that I may not have learnt through the resume. Things like why they left their last job might give me valuable insights into their plans or what they are looking for. This also helps put them at ease so that the rest of the interview goes more smoothly. ‘Tell me a little about yourself,’ is the interviewing equivalent of a soft pitch. It’s easy for them to take a swing at it.
Two, if we haven’t already covered it, I ask why they left their previous job or why they are looking for a new job. You will be amazed how often this will reveal ideal candidates or disqualify the wrong candidate simply because by their response.
Three, I always ask where they see themselves in five years. This will help you in the sense that you will know how they see themselves in their ideal future. Example if in five years they see themselves backpacking overseas, you may or may not want to hire them simply because you will be looking to replace them again 6,12 or 18 months from now.
Four, now that we’ve eased into the interview I will ask them a series of detailed questions about the job being advertised. For example if the job requires a particular set of core skills like our bookkeeping example, than these would be detailed bookkeeping questions. If I were hiring them as a builder they are be questions about the building code or other key details that would help me determine if they indeed have the experience they are claiming or if they are pretending
You’ll be surprised by the amount of staff who are perfectly capable of interviewing with you, who appear to be exactly what you need and then when you hire them they are woefully under prepared relative to the image they gave you.
In the early days we have had people we’ve hired as in-house accountants based on the experience on their resume, only to discover that they didn’t understand the fundamentals of accounting. Their five years in an accounting practice had been purely in an administrative capacity and they had long since forgotten any study they had done.
Asking these discerning questions will help you identify who is truly prepared and able to do the job and who is pretending.
For our accounting staff we always ask a question that rotates around a basic piece of Australian tax law called Division 7A. Anyone who does business accounting on a daily basis should be familiar with it and should be able to identify and fix the problem we give them with relative ease. Funnily enough 70% of the applicants we interview are incapable of identifying that it is a Division 7 problem at all, let alone suggest a working solution to solve it. This single question has been priceless for us in helping us assess the best applicants while dismissing the others.
Whatever your need, whatever industry your business is in, come up with a series of questions that will help you qualify your perfect candidate. If you’re struggling, tell yourself, “My ideal candidate could answer this question…” Then write down the question or questions.
Last, I always confirm that their availability will meet our needs, both in terms of time in the office on a regular basis and for their start date. I don’t know how many times I’ve interviewed a great candidate, only to discover they are about to depart for a several month vacation overseas. Alternatively they might well be stuck at their current job for a month or more meaning you’ll have to take that into account in your planning.
Once I have asked all of my questions, I am willing to take questions from the candidate. Sure, if they throw them out early in the interview, I’m happy to answer them but I don’t intentionally open that door until now.
The reason being I don’t want them to control the interview. I want to control and steer it, to ensure the crucial questions above get asked and answered. I also don’t want to waste time talking about remuneration and pay when they may not be qualified at all. I raise the pay discussion at the end of the interview once I am comfortable that I understand their abilities.
In a job interview I pay little heed to things like university degrees. Studies have shown that almost 30% of resumes and training found on resumes are actually fake. I place far greater emphasis on the skills needed to do the job than other educational accomplishments.
When conducting your job interviews, organise them all for the same day. Ideally one after the other. This way candidates can see those coming before and after them as they come and go from the office. This will improve your negotiating position before the negotiation even begins.
Often employees or prospective employees will attempt to negotiate a higher wage before they’ve even started. Don’t entertain this. Candidates try it often and yet in many hires, I have found that employees who push for this higher pay from the outset often under perform.
Giving employee a pay rise before they even begin sends the wrong message. It also irritates your existing staff who will undoubtedly find out about it. Long before you decide to give them a pay rise, you need to have them begin the work, and ascertain that they are as skilled and talented as they are asserting. With the exception of one staff member, I’ve only ever been disappointed by hiring someone who insisted on a pay rise before they began.
Step 4: Post Interview Process
Once you’ve identified your most likely candidate or two. It is time to begin the negotiations. If you have a clear winner start with them and call them to fine-tune the terms of their employment, start date etc. The terms you agree to should be documented in their employment contract.
Every employee that works for you should have a contract specifying the particular circumstances of their employment. This contract should include all of the things you set out in the interview and subsequent discussion. It should cover everything from their rate of pay through to job functions, expected hours of employment, leave entitlements and any other entitlements they have us an employee. It should also include a disclosure form for pre-existing conditions be they medical or otherwise. These disclosure forms will help protect your business in the event of incidents that may occur in the future. Your lawyer can advise on the terms and conditions that best suit your business in its local legal jurisdiction. Needless to say these will protect you from many of the unsavoury experiences that might afflict a business owner.
It’s not uncommon for these negotiations to take a few days or even another meeting to nail down. Ensure that before the employee begins with you, that they have signed their employee contract and returned any necessary disclosure forms. Between the interview and the negotiation process I would normally call each of their referees and ask about their experience with your new potential employee. Don’t just do a surface check, ask detailed questions. If there are any gaps or anything suspicious poke a little harder and see what falls out. These references are provided by the candidate and so at times can be misleading, used properly these will help you identify that the candidate is in fact the person you should hire for the job.
Last but not least, if the prospective employee does come back for another meeting I normally ensure that it is at a time when our other staff will be working, available and in the office. I use this as an opportunity to have the prospective employee meet his or her future colleagues and get a sense from my existing employees if they’ll be able to work together. From time to time this has revealed potential issues before they’ve even occurred.
Step Five: Crossing the T’s and Dotting the i’s
When you hire a new employee, there are of course a number of obligations you have. These vary by jurisdiction and so you will find that some of the advice in the following paragraphs will be specific to Australia but the principles are adaptable no matter where you are in the world.
For each employee you will need to have:
A Tax File Number Declaration – This paperwork is available from the Australian Taxation Office or through your bookkeeping software. Every single employee hired must complete one of these and submit it through the necessary channel.
Superannuation Obligations – As an employer of staff you have an obligation to pay superannuation for your employees. Ensure that you complete a Super Choice Form for each employee with their relevant superannuation details. This way at the end of the quarter you can forward the funds to the right superannuation fund.
Work Cover – Every employee needs to be covered by work cover insurance. The only exception to this (and this varies from state to state) is the director of a company or the trustee of a trust. Workers compensation won’t cover the director but all other staff must be covered with the current policy. If you have any questions feel free to visit Worksafe Queensland (or in the state that you are resident in) they will help you understand your entitlement and ensure that you are adequately insured. This one is not optional ensure that you have it.
A Workplace – Set up the employee’s workstation. Make sure that everything the employee needs do their job is there and that they feel comfortable. Ensure that your employee knows that they can approach you should they have any issues to discuss. Take the time to make sure that your employee is sat down and given the necessary training that they need in order to perform their job properly. This includes training on software, systems, protocol and procedure.
Step 6: Ongoing Training
To ensure that your new employee is carrying out their role in the manner in which you hope and expect, you will need to set standards and expectations. If they deviate from the expectation ensure that you correct them. If you do not, you will send the message that it’s okay to do it wrong or to not do it as you’ve directed. Either of these will cultivate an attitude of ignoring your business’s core policy and procedures. This in turn will create a negative culture and one that will hinder you from systematising and scaling your business.
Remember your policy, procedures and systems are the key to effectively scaling your business. Ensure that your new employee is well versed in these and correct any issues that occur.
Where to from here?
There you have it. Our system for hiring the right staff. Star Players will help you scale your business. By doing their job properly Star Players alleviate the requirements on your time. This allows you to be able to progressively get rid of the day today chores of your business and focus your time and effort on the things that only you can do.
Scaling your business requires you to hire Star Players as the only truly limited resource you have is time. You can never get any more, each of us has 86,400 seconds in a day.
You can always find more leads, get more sales, cut your expenses, improve your cash flow but you cannot get more time unless you hire capable staff to do the tasks that you would have otherwise had to have done if they were not there. Every new entrepreneur in business starts out having given them self another job. Only this time they find rather than having one boss they have many (all of their clients and other stake holders).
Eventually each entrepreneur needs to grow and scale their way until they truly have a business that can run without them doing the day to day work. Scaling is the key to having the time to do the things you want and need to do.
Scaling your business turns it into a healthy passive income where you are no longer trading time for money. We’ve included below a copy of our How to Hire Star Players guide, all you need to do, is tell us where to send it and it’s yours. Make hiring staff a breeze in your business!
It details a number of checklists covering the principles we have talked about above and will help you overcome many of the issues you will face when hiring staff.
If you are just starting out in business consider checking out our article on The Essentials of Starting a New Business.
As always if you have any questions or comments feel free to connect with us. We can be reached through e-mail at firstname.lastname@example.org alternatively feel free to join our Master Your Business Community and discuss it with other talented like-minded entrepreneurs.
Until next time, happy hiring!