Smart hiring is the secret to the success of a small business, Ben Pike discovers
SMALLER businesses are sabotaging their chances of success by hiring the wrong personalities when building their enterprises.
Workers also can sabotage their careers if they seek work at a company where their ideals do not fit with the organisation’s outlook, although they can reap great rewards by working for the right small operator.
Small Business Australia says more than half of all failed hires at a small business result from the employer hiring someone whose personality does not fit in with the job or the company culture.
Executive director Bill Lang says the average small business has between two and three employees on the payroll so hiring people unsuited to those roles will have a big impact on the bottom line.
‘‘ The biggest mistake that first-time employers often make is hiring someone with the right skills who they think can hit the ground running but they have an issue with their attitude and values, which is difficult to change,’’ he says.
‘‘ Often when you can, dig up a person’s true personality through behavioural interview techniques. How is someone likely to behave in certain situations, especially the situations you will have in your work environment? And then you want to validate that when you ring up past employers and get references.’’
Lang adds that when an internal person is promoted within a larger business, employers generally can predict how they will perform in their new role with 80 to 90 per cent accuracy. But the performance predictors for an external hire are about 55 to 70 per cent accurate.
It means a self-employed operator can struggle to recruit well, as hiring internally is not an option.
But this is no reason for sole traders to throw their hands in the air and go it alone, as hiring staff can do wonders for business sustainability.
‘‘ If sole traders avoid hiring staff they loose out on larger contracts for their services,’’ Lang says.
‘‘ They miss out on increasing revenues and profitability. Because they stay as a oneperson operator they are not building a business that has any asset value.
‘‘ Taking on all the work
themselves can often also be very stressful.’’
It may seem that hiring staff brings a lot of risks but Lodestar Leaders director Paul Flanagan says there are plenty of places small business owners can go for help.
‘‘ It is good value for small business to belong to an industry and employer association because, for the fee they pay, they get employment and industrial relations advice about setting up contracts correctly,’’ he says.
‘‘ And if they are on good terms with experienced people in the industry who they are not in direct competition with, it’s worth networking with them to get advice.
‘‘ I find that the acronym AART (Achieve, Activities, Results and Tools) is a very helpful way of finding the right person for the job.’’
Becoming an employee of one of the 2.7 million small businesses in Australia also is a great opportunity to take a more central role at work.
This is especially true for people in the services sector, which comprises 85 per cent of the total small business contribution to industry.
‘‘ Small businesses have more flexibility and can be more creative with the job descriptions they offer prospective employees,’’ Flanagan says. ‘‘ A new employee may have additional skills in customer service or particular parts to their personality that are worth developing.