Editor's note: This article was excerpted from Managing a Small Business Made Easy , which is a guide to the essential elements--including human resources, customer service, advertising, finances and advisors--you need to be successful.
I was working late one night to complete an important project for our company, a medium-sized manufacturer of agricultural and industrial equipment. It happened to be a Saturday night and the second and third shifts were not working. The plant covered over 500,000 square feet and was equipped with all types of machinery, including huge 2,000- and 3,000-ton vertical presses that stood more than 20 feet high. During the day, when all of the workers were there, the noise and activity level in the plant was very high.
This particular night, I had to go across the plant to a supervisor's office to collect some reports that were vital to our project. The plant was completely dark, except for a few safety lights glowing at the end of some of the long bays. I turned on the lights to illuminate my way and was suddenly struck by the eerie silence. It was almost deathlike. Here was this huge facility and millions of dollars' worth of equipment, but without people it was a useless collection of idle assets, worth only their price at auction. People, working diligently, were the pulse, the heart of this plant. Without people, there was no activity, no life!
Finding the "Right Stuff"
How many times have we tried so hard to match the skills of a candidate to the demands of the open position that the most important characteristics of a person have been relegated to lesser importance or forgotten entirely?
The key to a person's worth (the "right stuff") is integrity, honesty, intelligence, the ability to communicate, and the ability and willingness to learn. Technical skills are important, but without the key ingredients, the technical skills of the applicant may be irrelevant.
Finding the candidate with the "right stuff" is not an easy task, but then my grandmother, after several years of urging, finally convinced me that anything that is worthwhile is difficult and requires considerable effort.
There are several roads to successful hiring:
1. Personal knowledge of a candidate. The best candidates are usually not hunting for a job. They may be people employed by one of your customers, people in competing companies, people in the same industry but not in the same line of business, or people in other industries who have exhibited the talents necessary for the job. More important, do you or one of your key associates personally know the candidates? If so, you may begin to pursue them, but with a few admonitions.
If the selected candidate works for a customer, it's a good plan to contact the customer and let him know that his employee is a candidate for your position. I once hired one of my best customer's top men, believing that I would lose the customer. I decided it was worth the risk. I did lose the customer, but not forever. The man I hired is now successfully running the business from which I retired. It was well worth it!
People with the "right stuff" are absolutely essential to the future success of your business! A compromise in this area has come back to hurt many businesses: it typically involves terminating the "compromise" and repeating the hiring process. What's worse is that these "compromises" do poor work, cause internal problems, and end up costing the company in many ways.
Depending upon your relationship with a competitor who has a potential candidate, you may wish to treat that competitor much the same as recommended for your customer. The same may be said for candidates working for one of your suppliers.
2. A valued friend knows the candidate personally. This is the next best thing to knowing the candidate yourself. A referral from a friend, a business associate or a present employee whose judgment you respect is a valid basis for pursuing a candidate. Note that your friend must be more than a golfing buddy; you must respect his judgment as you would a trusted associate.
3. "Pay the price." If the first two approaches don't provide a candidate, the next best avenue to the "right stuff" is a toll road. A search firm or a highly reputed employment agency is a good but expensive route (often in the area of 30 percent of the employee's starting annual compensation). Keep in mind, however, the value of an outstanding employee. It far surpasses the fee you may have to pay. Your agreement with the search firm or agency should include the right to reimbursement if the hired candidate doesn't work out within a reasonable time period, perhaps six months and sometimes longer. This may be negotiable with each individual firm. This avenue is most often appropriate for higher-level positions and not entry-level jobs.
The search firm or agency should do all preliminary screening, which often includes intelligence, personality, aptitude and skills testing, the cost of which should be included in their fee. (Note: These efforts do not test judgment; you must do this yourself.) In addition, you should expect the firm to provide you with at least three good, qualified candidates who meet the requirements you specify when you contract with the firm.
4. Hire a temporary employee from an agency. It's quite common to contract for a temporary employee only to find that the temp is the right person for the job on a permanent basis and may be available. In this case, you should be prepared to pay a fee to the temp agency. This is a reasonably good way to hire clerical and lower-level technical personnel and it keeps your business moving while you're continuing your search.
5. Advertise in the right places. Although we have not found many "right places to advertise," they may include trade or industry magazines that you're reasonably sure are read by the candidates you're seeking. Sometimes the local newspaper can be a good source for candidates, but be prepared to kiss a lot of toads to find the prince. Likewise, some have reported success with national publications such as The Wall Street Journal and the National Employment Weekly, and others report good results by advertising on the internet. Choose the outlets best for you. Remember: If you hire an out-of-town candidate, you will be expected to pay for moving expenses!
The hiring of a candidate assumes that you have carefully and thoroughly considered your own employees as a source. You must not overlook current employee candidates! Study the background and work history of those who might qualify. You may not be aware or have forgotten that one of them has all of the qualities that you are hunting for in the new position.
Many businesses post job openings on the employee bulletin boards. I believe this is a good practice.