You have a new business startup, and you need some employees to help your startup grow. You are over-run with work, and things are starting to take off. You might as well hire anyone because a “warm body” is better than nobody right?
Wrong. 100% wrong. The hiring of employees takes time and effort, and if done incorrectly can have a devastating cost on your business. Bad employees might do minimal work, which technically speaking is “some” work. However, the cost of hiring bad employees outweighs any work that they accomplish.
Impact on Your Business
First of all, employees that are negative, fail to hit deadlines, and are disengaged from the team can ruin your company’s culture. Especially if you are a startup and you are just beginning to build a culture or atmosphere. Negativity is contagious and so is disengagement from the team.
In a business, you need to build a culture of trust. In Patrick Lencioni’s book “The Five Dysfunctions of a Team” he outlines the necessary confidence that you must have in a business.
His main point is that your company can have more talent, technology, and funding than your opponents, but if you lack teamwork, you will never outperform them in sales.
Jorgen Sundberg, a favorite recruiter, puts the cost of adding an employee to the team for an average business at $240,000 according to Forbes.
That is a ton of money to be throwing away for a negative impact. Do not allow your employees to disengage from the team, disrespect leadership, or burn other employees.
Your business culture is of utmost importance, and just one detrimental hire can destroy the entire atmosphere of productivity.
Influence on Your Clients
Customer service is important. At your business, your clients and customers needs come first. They are incredibly vital to your company’s success. The moment that your business or firm stops prioritizing customer satisfaction, you can expect that at that moment, growth will begin to plummet.
Customers that are satisfied will continue to come back to your business. It’s incredibly difficult to gain new clients. On the other hand, it is relatively simple to keep old ones coming back for your services.
A bad hire will cost you customers, and if you are a startup or even an established business, you cannot afford to lose valuable customers.
Cost of Turnover
After putting up with a failing employee for months, you feel like you have no option but to send them packing. The problem is all of the time and resources that you have already wasted.
It takes a manager’s time to adequately train and instruct an employee to do their job correctly and efficiently. A new employee will mean that the manager is going to have to carve out more and more time to train the new employee, which in turn, makes the managerless efficient and productive.
The hiring process also costs your business. First, you have to put out the resources to search through applications and prospective hires, and then you have to go through the interview process and pay for insurance and possibly even relocation for the new hire.
The cost of going through two or three employees in a single calendar year can add up quickly. We recommend that you get it right the first time, and make sure you hire the right man or woman for the job. Here are two quick tips to help you in that area.
Cautious in the Process
Do not rush the hiring process. As you have already seen, it is far too costly to hire someone who does not accomplish what the position demands. Instead, take a careful look at the references and build a thorough interview process. Get to know the person you are interviewing and take a deep dive into their portfolio.
Try to interview multiple different candidates as it will help you to gauge various criteria that you are looking for in the potential hire.
Avoid the pitfalls of hiring too quickly at all costs. Remember, you might need a position filled ASAP, but it’s not as crucial as a finding the right person for the job.
It’s becoming more and more popular in the business world to have a trial period. The test period involves allowing the new hire to work for you for a specific time. When the trial period is up, the new employee should receive an evaluation from every member of the team. This way, you can accurately decide whether or not that is right for your business.
Those are our tips for a researched and thought-out hiring process. Always know and understand the cost of your employees. Hiring the right person can open up a wave of new growth, but the wrong hire can end up poisoning an otherwise successful business.