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Your employees among your most important assets, but hiring and keeping the right group of employees can be challenging for small businesses. The cost of hiring, training, and retaining employees can add up. For example, the entire interview process takes an average of 24 days, and the average cost of a bad hire equals 30% of that employee’s first year potential earnings. Small- and mid-sized companies spend $1,888 on training and development, on average, per employee. The average cost of employee turnover is 33% of the worker’s annual salary. Regardless of your size, developing your team requires being strategic in how you recruit, select, on-board, train, and retain employees. A well-planned hiring process ensures you have the right employee who fits your business. The better the hiring process, the greater the likelihood that your employees will stay with your business.
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Strategic hiring
Each time you seek a new hire, it’s a big investment. You want to hire someone who is the best fit without the risk of losing a new person within a couple of months because the screening process was flawed. Hiring is not a particularly thrilling process; it’s a lot like dating – You have to kiss a lot of frog candidates before you find your new hire prince or princess.
A strategic and well-planned hiring process ensures you have the right employee who fits your business. The better the hiring process goes, the greater the likelihood that your employees will stay with your business. Your hiring process should include: detailed application, background checks, past employer reference checks, drug testing (if necessary), and interview.
Here are some tips on how to hire the right person for your small business (Read more in this blog post on How to Hire the Right Person(s) for Your Small Business)
- Have good job descriptions
- Every job should have a specific job description that clearly outlines the tasks necessary for the position. A written job description will eliminate confusion while ensuring that each member of your team is qualified for the position they hold.
- This job description will be an important starting point for creating a job ad when you need to fill the position.
- The written job description should include both the skills and training needed by the employee.
- Write a compelling job description and attention-grabbing job ad
- Create a compelling job description. Start by brainstorming what makes the job and your business different. Consider the employees you already have and how another person will ideally mesh with them.
- Use this job description to create the job ad. Then make the ad attention-grabbing and interesting. This will help your ad stand out and attract qualified candidates who are in better alignment with your values, and will save you time by heading off the people who aren’t the right fit. (Here are some tips for crafting highly effective job ads).
- Post your job ad in the right places to get it in front of the right candidates
- One good way to find competent applicants for the job is through online sites such as Craigslist, Facebook. They are inexpensive and may provide access to a larger pool of potential employees.
- You may also consider websites such as Indeed, LinkedIn, Glassdoor, Monster, and CareerBuilder, which have big applicant pools and a better system put in place for finding the best candidate for the job.
- Share the job ad on every social media outlet where you have a presence.
- Heavily recruit amongst your immediate social and professional networks. There’s a good chance your peers will be able to refer you to a good match.
- Share the job opening with community colleges and universities in your area.
- Interview candidates strategically to avoid hiring mistakes
- Before interviewing applicants, have a set of questions in mind. These questions must be applicable to all and related to the job at hand. Use these questions to guide you during your interviews so you don’t get distracted.
- Know exactly what you want from your future employees and be prepared to explain it. Interviews are a two-way street and your applicant will ask questions to gain clarification about the job.
- Be honest without being harsh. You can be direct with your applicants without sounding too harsh. If their answer to one of your questions worries you, tell them about your concerns and ask them to elaborate. Interviews are structured to prevent distractions and straying from the topic, but if an applicant has a unique point of view on certain matters, it is something worth listening to.
- Onboarding
- Now that you have a new hire, it’s time to properly onboard them. Efficient onboarding results in increased productivity, company loyalty, and job satisfaction.
- During orientation, new hires should be informed about the rules and regulations, from dress codes to facility rules to attendance policies. Consider giving employees a written handbook of all rules, regulations, benefits, and more if there is a lot to cover.
- Employee documents: As much as we hate paperwork, all documentation for your new employee must be filed and completed.
- Define a training or learning period where new employees can learn the ropes and when they’re allowed to be slower and make mistakes. Employees who get the full brunt of their work duties from day one tend to experience more stress compared to employees who undergo a training period. If possible, assign either yourself or a senior employee as a guide to new hire.
- Create short-term goals and milestones for your new employees. This means setting a standard on their work performance as time goes by. For example, during training, you may excuse blatant mistakes and low output, but three months from now, you may shoot for a greater amount of work to be done. Discuss these goals with your new employee.
Training
Even the best employees aren’t as likely to succeed if they don’t have proper training. Employee training is an effective way to teach new employees and develop existing workers.
- An employee development plan will make your business more resilient and move your business closer to its long term goals.
- In-house training might include learning company policies, understanding standard operation procedures, becoming familiar with disaster preparedness activities, etc.
- External training may be available to help your employees and businesses maintain efficiency, stay on top of trends, etc.
- By providing increased opportunities for employee training, you will not only contribute to the success of your organization but also the personal development of each team member.
Retaining employees
Attracting quality employees is one thing. Keeping them is another. Employee retention involves keeping employees satisfied, which can be through pay, incentives, and employee morale. The same approaches to retain employees also make your business attractive to new employees. Small businesses can be creative in using incentives to boost employee morale and keep them invested in being part of your team such as through flexible work hours, seasonal work opportunities, work from home options, non-traditional compensation such as housing or transportation stipends, etc.
- Have good job descriptions
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Question 1 of 7
1. Question
Do you have enough staff for normal operations under regular working conditions?
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Question 2 of 7
2. Question
Does your business struggle to hire employees?
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Question 3 of 7
3. Question
Does your business struggle to ensure employees have the right skills for their jobs?
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Question 4 of 7
4. Question
Does your business struggle to retain employees?
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Question 5 of 7
5. Question
Does your business have a strategic hiring process?
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Question 6 of 7
6. Question
Do you have access to an adequately trained workforce?
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Question 7 of 7
7. Question
Do your employees have reliable transportation to and from work?