When I started my first business almost ten years ago, my definition of success was how big my company could be in terms of staff. The more people I employed, the more successful I felt I would be.
Many businesses and many failures later I now understand that success has many definitions, but the least effective is how many people you employ. One of the most effective is profit. Profit and cash flow should dominate any small business’s definition of success.
In my experience, the more staff I hired, the more complicated my business became and the more difficult it became to be profitable.
Of course this isn’t a one-size fits all rule. Often an increase in staff can alleviate pressure, increase sales and make your organisation feel more whole. Context always needs to be applied, so lets apply some context.
Push To Breaking Point
In one of my businesses, I recall hiring a staff member five months after launching. We’d just signed a huge client, were set to travel abroad for a month and needed someone to hold the fort while we were away. This was a mistake.
Five months into any business you barely know what your name is, let alone how sustainable your growth is, where your major revenue streams are, or how you work with your co-founder. In hindsight, this first hire put unnecessary stress on our business too early.
What we should have done was work harder. When you think you can’t work any more, work harder. If we’d worked to breaking point and then considered hiring, we would’ve had a better understanding of our business, clients, product and each other.
Advice from the trenches: If you’re just starting out, give a lot of thought to your first hire. Who’s it going to be? What skills should they have? What type of person are they, and what will they become in your organisation? Are you hiring the best possible individual?
Hire the Right People
People often say that you should trust your gut with hiring – fantastic advice but not always easy to stick to. If you’re looking to hire quickly, then it’s going to be hard to only hire people that your gut says you should.
Advice from the trenches: When hiring, I like to ask very specific questions that tell me if they’re my kind of person and if they’re going to gel with the company ethos.
Ensuring your team works well together, fits together and understands one another is imperative to the survival of your business. Always hire the right fit, do not compromise.
Hire Slowly, Fire Quickly
Making sure you’re hiring the right people is even more crucial in South Africa where labour laws are not in favour of the employer. It’s extremely difficult to fire people. There are hoops to jump through, checks and balances and then there is the CCMA to contend with if you make any mistakes.
Advice from the trenches: This is why it is very important to not rush the recruitment and hiring processes. Hire slowly, take care, be thorough and don’t rush the ‘getting to know you’ phase of the process. It can take months of maneuvering to remove a bad egg from the team in the correct and bureaucratic way.
Ask The Right Questions
We’ve heard about Google, Microsoft and other cutting edge firms asking ludicrous interview questions to ‘understand the thinking process of the candidate’.
Personally I think this methodology doesn’t really apply to small businesses. You need to understand every person coming into your organisation and if you’re asking vague and arbitrary questions that you don’t really understand, then how do you know where they fit in?
I like to ask the following standard questions:
- What was your favourite thing about your last job? This gives insight into what the person likes to do, what types of activities they enjoy and if they’ll fit the company needs.
- Who was your least favourite person at your last job? This allows me to see where they fit into a hierarchy. Was their favourite person their boss, their co-workers, the lunch lady?
- 3. Do you have any side projects? I love to understand what my team does in their spare time and want them to engage in things other than their job. This often helps me understand if they’re self-starters and can maintain a side project or if they do the bare minimum to keep themselves engaged in their work.
It’s important to remember that people lead to processes. When there are just two of you, you might not have to worry about leave, work hours, breaks, holidays and the rest of the complications.
When you’ve got a team the complication and responsibility is exponential – once you’ve got people on your books you become responsible for their livelihoods.