3 Tips for Owning Your Company's Most Important Decision: Hiring
Entrepreneur's New Year’s Guide
The one thing the best companies in the world get is that their people are their most important assets. That rings especially true in a service-based business. At the end of every workday, your assets leave the worksite, and they return the next day. If your product is delivered or executed by people, then it's common logic to assume that your people are your most important asset.
Some of the largest challenges at Practice Makes Perfect have been addressed by bringing the entire team together and brainstorming solutions. I don’t think there is a single organizational problem that can’t be solved if you have enough smart and committed people sitting at the table. Knowing that the biggest and most important decision you can make is hiring the right people means that all CEOs should be prioritizing their time to make the right hires.
Unfortunately, operating a business often gets in the way of desired priorities. So how do you own your company’s most important decision without having to vet every single candidate? Here’s three things I’ve done at Practice Makes Perfect:
1. Clearly articulate your company values.
This is one of the most important things you can do, especially when you have a small team! The values, and more importantly, the behaviors that define your values will say a lot to a prospective employee about your company. I’ve had friends apply and choose not to apply to a company based on their values. So pay special attention to creating the things that are important to you in the workplace.
2. Play an integral role in designing the hiring process.
This is your opportunity to create the hurdles that will keep “bad fits” from joining your team. Though it is important to play a large role, make sure you’re not the sole voice in the design. The process you create will dictate how the interviews are conducted, what your team members will be looking for in potential employees and save you from interviewing every single candidate. People should only be able to get into your company by getting through the process you designed. The only exception we make is for people who have interned with us before. At that point, we’ve had enough time to evaluate whether or not they’d be a good cultural fit for our organization.
3. Make the final decision on all hires. No exceptions.
No ifs, ands, or buts. There is research that shows that a bad hire can cost as much as 15 times their base salary. Not to mention that one really good hire often produces more value than three mediocre hires. That means getting it wrong can be costly and getting it right can actually be lucrative for your business. For every hire, we have put together a hiring committee of four people. We appoint a head of the committee that assembles a hiring packet for every candidate that they think should be hired. I get a hiring packet for every potential hire and within a few minutes I can get a sense of the candidate and their abilities.
Letting your teammates know that you will be involved in every single hire sends the message that it is really important to you. I know when I worked at other companies, when I knew or thought something was important to my boss, I wanted to make sure that I did the best job I possibly could with it. More importantly, it means that you’re likely to get people who are better fits for your company.