An Article by Patrick Sutton, partner of O’KellySutton in the Sunday Business Post 17th November 2013,
Recruiting your first employee can be an onerous task, fraught with difficulties and costly. You are effectively doubling your workforce something you’ll probably never do again. Some important matters to remember along the way are outlined herein.
Set out in writing the job specification and person specification before starting the search process. If possible do not interview on your own, get a friend or family member to sit in on the interviews with you. Prepare your interview questions in advance of the interviews. Where appropriate get the individuals shortlisted to sit behavioural evaluation tests such as Predictive Index. Request the shortlisted candidates to give a formal presentation on what they can bring to the job and the business. Before you offer the job check out the references.
With regard the pay scale, research the industry standards taking into account experience, skills, age and track record. Where possible the salary should in some way be linked to performance with appropriate recognition and rewards structures.
Ensure there is a signed employment contract in place. All correspondence’s, supporting paperwork, assessments, and references should be placed in an employee file and kept safely.
On appointment plan out and agree with the employee what his/her role and duties will be. Ensure the employee is given adequate resources and tools to do the job. Start as you mean to go on and put a performance measurement system in place to gauge employee results. It can be as simple as reporting the previous days/weeks actual sales versus target. Don’t just expect the employee to automatically hit the ground running. Remember ongoing communication with the employee is critical giving feedback on tasks well done and tasks not well done.
Best results are seen where the Business Owner shows real leadership and motivational attributes. There may be an increased level of pressure on you with the new hire so It’s important to understand how to manage stress levels, and develop a ‘feel good’ organisation and culture. You’ll need to develop a sense of vision, strategy and purpose in the running of the business particularly as you grow the employee numbers. Don’t automatically expect to retain staff just because you pay them their wages. They must have fulfillment a sense of purpose and believe the business has a future.
Research is widely available for established companies which shows over 50% of new hires fail within 18 months. 90% of the time new hires fail due to attitudinal / motivational reasons with only 10% of the time due to a lack of skill. The fail percentages are quite a bit higher for start-ups.
Make sure your finances are in order so that you will be able to pay the wages and taxes as they fall due. Keep your Bank and Accountant up top speed as to what is going on with the business. You may need a temporary overdraft to fund the expansion until cash starts to flow in from the new hire.
Finally, if the new hire is not working out do not be slow to make the hard decision, to cut your losses and start again. Best of luck and enjoy the journey. Patrick Sutton, O’KellySutton Chartered Accountants and Business Advisors, Kildare, Sutton@okellysutton.ie,