How to Hire for Your Small Business | Tory Burch Foundation
Build my team
When and How to Hire New Employees
Signs it’s time to grow your team, and advice for doing it well.
Link copied to clipboard
Determining when to add to your team is one of the most important decisions a founder makes. Hire Breakthrough founder Kimone Napier led a webinar designed to help our founder community know when to start looking for new employees, develop a hiring strategy and ask the right questions.
When to know it’s time to hire.
Growing your team is about preserving yourself as well as your company. “If you can’t take a break or vacation, that usually leads to burnout. And that’s really why, typically, a lot of businesses close within the first five years of business,” cautioned Napier. Her rule of thumb is to begin your candidate search before your business reaches a major period of growth. You want to begin hiring before you are truly desperate, so you can make the best decision for your company.
Signs of growth that need additional support can include being forced to turn down opportunities due to bandwidth. You may also notice that your customers’ experience is suffering or your sales are stagnant. Many entrepreneurs are good at teaching themselves new skills, but if Googling to learn something is taking up significant time, that’s another sign you should start thinking about a new hire. Lastly, if you’re ready to add a new revenue stream, you will need new help to stay on top of everything.
Create your recruitment strategy.
“You need to hire in a way that’s going to help you to generate revenue, but you’ve got to give yourself time in order to do it,” explained Napier. She helps entrepreneurs and other leaders create their hiring strategies using five steps: clarify, attract, simplify, analyze, and engage.
Napier advises founders to budget at least 42 days or 1,680 hours for their full search. Most businesses spend $7,000 to $10,000 on hiring a new team member, so budget for that, too.
Clarify
Founders and managers need to have a clear understanding of what they’re hiring someone to do and the company’s mission, values and culture. Track your or your team members’ time to account for how long projects take, so you can begin to understand how to craft the new role. Take the time to talk with your current employees to get help with the job’s title and any additional duties you may have missed.
Job seekers are more discerning than ever about the jobs they take; having a clear mission can help your company stand out in a crowded marketplace or job board. Take stock of where you want your business to be in the next two, five or ten years. “They want to know where they can envision themselves in the future,” Napier said.
Attract
Create a job description that contains the duties and values you clarified in the first step. Your description should also include the role your open role would be reporting to, timezone requirements if the position is remote and the pay. Even if your state doesn’t require you to list salary requirements, being transparent will keep you from spending time on a candidate who ultimately turns down an offer because the pay doesn’t align with their needs or years of experience.
Be as detailed as possible about the tools or platforms someone will need in this new job. Either a candidate will come with those skills, or they have a chance to show how their interest and initiative by researching them before they get to an interview.
A complete job description also needs to include benefits. While it’s often difficult for very small companies to offer the kind of health and retirement benefits major corporations do, founders can get creative about what they can give employees. Things like free lunch on Fridays or covering exercise plans can make a difference to applicants.
Simplify
There are so many places to advertise an open job that it can be easy to get overwhelmed. Napier recommends posting the role in three to four places to begin. Remember, posting and managing ads on various job boards require time and money; budget accordingly. Also, let your network know that you have an open role, including professional groups, former colleagues and alumni associations. “Candidates are all around you,” she said. “I want to stress that.” Ultimately, you have to create a customized approach that is manageable for you and allows you to reach candidates where they’re most likely to be.
Next, identify the top skills or qualities you want in your new employee so you have an easier time going through the applications and deciding who to interview.
Once you’ve posted your job description, decide which questions to ask all your candidates. Not only does this simplify the interviewing process, it helps mitigate bias by measuring all applicants against the same criteria. If you have other team members, consider making them part of the interview panel and use a scorecard. These steps can also reduce bias. Napier favors situational questions because answers to them allow you to see how people approach problems. Ask, “When was a time you met a challenge?” or “what would you do in a certain situation?” Beware of asking illegal interview questions, like ones about military service, marital status, race, religion and citizenship.
After an interview, many employers assign an assessment to get a clearer understanding of an employees’ skills. Recruitment experts suggest that if you decide to make a test part of the interviewing process, you give candidates a clear understanding of the time they should spend on it (typically just a few hours). Be sure to leave yourself time to review their work.
Analyze
Review the information you’ve collected from candidates’ resumes, portfolios, interviews and assessment tests, if applicable. Measure that information against the criteria identified earlier.
Engage
At this point, you should be ready to extend an offer to someone. Congratulations! Welcome them with an offer and an attorney-reviewed contractor or employment agreement. Check your state’s guidelines for the forms you need to collect from them and the correct way to notify state agencies of their employment.
Smooth the transition.
Give your new employees set benchmarks for their first 30, 60 and 90 days in a role, and meet with them regularly to ensure they’re hitting them. “The biggest mistake that I see a lot of people make is that they will not have any of this, and the person starts to roll in it kind of like a deer in headlights,” warned Napier. Encourage their full participation in projects and idea sharing from the beginning. When employees feel like an important part of the team, they will do their best work and invest their efforts in your company for the long run.
