The good news is that you want to leverage the time, talents, treasures, intellectual property, networks, etc. of other people to help grow your business. The bad news is that very few of us have a 100% success rate at hiring. In fact, most of the business owners and entrepreneurs I know have plenty of war stories to share of bad hires (also known as “Dumb Tax”).
So, if you’d like to make better choices moving forward in order that you can get the right people on your team—people who can help accelerate the growth of your business rather than detract from it, you’ll definitely want to avoid the following five hiring mistakes.
Mistake #1: Not Being Clear on the Position and Your Expectations
What seems so obvious rarely is. It would seem obvious that before someone would set out to hire another person for a position that they’d have a job description created for that position with clear expectations of not only what kind of person they’re looking for, but what kinds of performance standards that person will be expected to meet. Unfortunately, that rarely happens.
Frequently I’ll hear a small business owner say something like, “I need to hire a _______,” or, “Do you know someone who could do _______?” When I ask, “Do you have a job description?” Usually all I hear are crickets. It’s shocking.
When I follow-up with, “Do you have clear performance standards for that position (i.e. what are your expectations for successful performance)?” I usually get a sheepish, “No.” So my recommendation to you is don’t be that person. Get very clear on exactly what you want that person in that position to do, what kind of person you’re looking for and what your expectations are for them to be successful.
Why? Because you can’t hire right if you’re not clear on the target. Unfortunately, since most business owners and entrepreneurs aren’t clear before they hire someone, they tend to have poor hiring records (and either put up with a poor performer or keep playing the hire and fire game until they find the right fit).
Mistake #2: Letting Personal Preferences and Biases Affect the Decision-Making Process
We all have them. The problem comes in not acknowledging them. For example, let’s say you have a personal preference toward hiring a certain gender for a position (for ex. a woman as a receptionist or a man for a corporate sales executive position). If that’s true, you may overlook a better qualified person for that position simply because they don’t fit with your personal preference.
Likewise, let’s say you have a personal bias toward people with well-developed vocabularies who have strong social skills (i.e. maybe someone like you). If that’s true, you may have a hard time seeing a better qualified candidate who may not be as cogent or extroverted.
We all have preferences and biases, which is why it’s not only wise to be aware of your own biases and preferences, but also to involve others in the hiring process. For example, you don’t have to be a Fortune 500 company to do tandem interviews. You can use a spouse, a friend, a fellow business owner, a consultant or a fellow employee (or two). You simply need to engage more people than you because all of us have blind spots. Getting hiring right is too important to do on your own.
Mistake #3 – Hiring Someone Who Doesn’t Fit Your Culture
Every business has a culture. Unfortunately, for most small businesses, it’s not intentionally designed. It tends to be organic and it usually grows out of the personal preferences and behaviors of the founder/business owner. If the founder is a free-wheeling anything goes kind of person, that tends to create the culture. If the founder is a traditional top-down, command and control kind of person, that tends to create the culture. If the owner is a stickler for metrics and measuring everything, that tends to be the culture.
The good news is that all kinds of companies grow with all kinds of cultures. There isn’t one perfect culture (though there are some culture drivers that can speed up growth—see my book, “Breaking Through Plateaus”). So, my point isn’t to say, “You need to have a certain culture.” My point is to say, “Whatever your culture is, be clear about it and hire accordingly.”
For example, let’s say you have a culture where everyone does everything (i.e. even you do your own admin tasks). To get to the next level, you think, “I ought to hire someone who’s managed a sales force at a Fortune 500 company.” So, you go out and hire a very expensive sales executive to be the leader of your sales team … of four people. Chances are, you’re going to have a culture problem.
He (to avoid the he/she issue) will probably struggle with not having an admin. He’ll probably struggle with doing his own research. He’ll probably want to outsource a lot of things to outside vendors and consultants, etc. Why? Because he just spent the last twenty years of his life in a large multi-national company where that was the way they got work done. Unfortunately for you, it’s a culture mismatch.
Mistake #4: Deciding Too Quickly (or Taking the First Person)
Let’s be honest, your plate is already full. Like most business owners and entrepreneurs you’re not wasting your day playing Angry Birds or posting on Facebook. You’ve got a to do list of 837 things on it. The last thing you want to do is spend weeks/months looking for the right person—especially because work is falling through the cracks everyday that position isn’t filled.
So, what most business owners and entrepreneurs do is they tend to hire the first person who’s in the ball park. “Joe’s not perfect, but he’ll be good enough. We can train him and he’ll do fine.”
Unfortunately, the cost of a mis-hire is astronomical. Depending on the position, typical HR estimates are that the costs of a mis-hire are 2X to 5X of someone’s annual salary (i.e. it’s not just a few thousand dollars). The cost of a mis-hire isn’t just about the salary, it’s also about the time spent to rehire, the onboarding and training costs, the HR costs, the paperwork and admin costs, the amount of time it requires from you (and others) times your hourly rates, it’s the severance costs, it’s the cost of lost opportunities, etc. When you add it all up, it’s huge. Plus, there are the emotional costs related to having to fire someone and the impact that has on your team, etc.
That is why so many of us who’ve done this for a long time all say the same thing, “Hire slow, fire fast.” Don’t hire fast. It always costs more than you think when you hire the wrong person. And never forget, “80% of managing is hiring right.”
Mistake #5: Not Having a Formal Process
This one flows out of #4. One of the reasons why so many small business owners and entrepreneurs hire too quickly and make so many bad hiring choices is because they don’t have a formal process in place. In general, a typical interview “process” is an interview or two (usually with someone they know or someone who they know knows) and based on how the interviewer feels at the time of the interview, they’ll offer that person a job. Now, technically, that’s a process—just not a good one or a very formal one.
Instead, you should lay out a process with a series of checks and balances. To help you get started thinking about a more formal process, here are some questions you might want to think through.
- How will you develop the job description?
- What metrics and expectations will there be?
- How will you notify people about the opening?
- How will you sort through and pre-qualify who you’ll spend time with?
- Will there be an application?
- Do you need them to take any third-party tests before the interview process?
- What will your interview process be?
- Will you have others engaged in the interviews or not?
- Will you use the same list of questions with each candidate or not?
- Will you have them demonstrate their skill set or not?
- When will you do background checks? Education checks? Drug checks?
- Who will call the references?
- Will you have the candidate set up the reference checks or will you do that? Etc.
Once you start thinking through the process, hopefully, you’ll be motivated to put a system in place that you think will give you the best shot at creating a process that will result in you hiring the best qualified person for the position you’re seeking to fill.
So, if you want to do a better job of hiring more A players, make sure you avoid these five mistakes by
- Creating a job description and scorecard that clearly states what the person will do and what your expectations of their performance will be
- Putting your personal preferences and biases aside as much as possible and making sure you engage others in the interviewing process
- Only hiring people who fit your culture
- Being willing to wait until the right candidate appears (i.e. Hiring slow)
- Designing a formal hiring process that you (and your company) use consistently
If you do those five things, you’ll avoid the five common mistakes I listed above and increase your probability of hiring the perfect person for the position the first time out
To your accelerated success!
P.S. If you have some other classic hiring mistakes you’d like to add, make sure you add them in the comments section below (or click here >> if you’re reading this by RSS or email)