Micrel, the Silicon Valley company I founded and led for 37 years, had the lowest employee turnover rate in the American semiconductor industry, and the highest rate of boomerang (returning) employees. I personally have hired hundreds of people and Micrel hired thousands.
Hiring the right employee matters more than most other decisions you or your management team will make. A bad hire can be downright destructive to a company. A desperation hire likely produces lackluster results. But a great hire will lift your sprits as well as your profits.Knowing how to hire is as important as knowing your marketing, knowing how to innovate and knowing how to manage corporate cash (a topic I discuss at length in my book Tough Things First). The key to having low turnover as well as high-performing employees is in the methods that you use in selecting and interviewing candidates.
Start with knowing the role
Young companies often do not think through what they need in each role. This may be due in part to the ever shifting nature of startups; but not establishing the essential duties, and thus the critical capabilities of an employee, is suicidal.
Start with knowing exactly what you want in a hire, and writing a well-defined job description.
This includes both education and experience, and it may include specific knowledge, industry contacts, personality profiles and more. It is better to be too detailed than not detailed enough.
Engage many people, especially from outside the department
A few blind men may not be able to know they are touching an elephant, but by collaborating they could likely document the specimen completely.
Leaving hiring selection to a small number of people is the same situation. Everyone perceives things differently, and everyone sees different aspects of a candidate. Only by having an appropriate number of interviewers and a rational method of discussing and scoring the candidate can great hiring decisions be made.
Interview teams should consist of six people, with at least half being from outside the group for which the individual is being interviewed. That last point is significant. Most employees will have to work across departmental or team boundaries. What someone outside the group sees is something people within the group likely will not.
Imagine you are hiring a new systems software developer – and über geek. Other systems programmers and the department head will get the quirks common to this type of genius, and overlook things that might cause problems with applications developers, system admins and others outside his group.
Selecting the six interviewers is very important and needs to ensure that people with the right disciplines have a chance to interview the prospective employee. There is little use in having our systems programmer chat with anyone in the accounts payable section; but not having him or her interviewed by the head of product support could be a deadly mistake.
Allow the candidate to open up
Where and how the interview is conducted affects the accuracy of the interviews.
Find a quiet and private location. Job interviews are stressful enough. Inducing loads of distractions and being subjected to roving onlookers doesn’t relax anyone. Easing the candidate gives them a chance to have a personal interview process and, if the interviewers are warm and inviting, to open up about goals, experiences and even personal drawbacks.
Every interviewer should start by saying how much they appreciate having the candidate interviewing with your company.
After all, they likely have alternatives. They decided your company was worth considering, just as you decided the candidate was. This mutual vote of confidence is a good start, and should be acknowledged.
Next, shut up. During the interview, let the prospective employee do most of the talking while you do most of the listening. Your mission is to find out as much as possible about the candidate, and you cannot do this if your mouth is engaged.
The more comfortable the candidate feels while talking with you not only enhances your chances of getting the information that you need, but also the chances of the candidate wanting to join your team.
Learning what is important
Learning what a candidate knows is almost as important as learning who they are. This goes back to making the candidate comfortable and letting them speak.
By asking difficult questions, you will make them feel uncomfortable and not expose their truest personality. You can also achieve this by monopolising the conversation, coming to the interview with a less than positive attitude, or even by bad-mouthing the candidate’s current employer. Instead, by being welcoming, warm, and mostly quiet, you quickly discover what kind of a person they are. You get an idea of whether they will match your company’s culture, be agreeable to other employees and meet your expectations.
Among the things you should watch for during an interview, some of the most important are:
Money Talk: If the prospective employee focuses on compensation, that is a red flag. Everyone needs money, and there is no shame in discussing compensation. But a candidate fixated on rewards is not going to be fixated on providing value.
Outbound Attitude: What did the candidate think of their prior employer and job? If they disliked their employer or the type of work that they were doing, this may be a problem. The main reason employees leave or search for another job is that they did not like their immediate supervisor. But this dislike may be the employee’s perception or poor people skills. Otherwise, liking their immediate supervisor is a positive.
Dress for no Success: How an employee came dressed for the interview may tell much. The goal is to see if the way they dress is comparable with what you expect, because you are a product of your corporate and group cultures. The systems programmer discussed above might set off warning bells if he did show up in a suit and tie, as would a potential CFO arriving in sneakers and blue jeans.
And the judges score his performance as …
Micrel used a 10-point rating scale for each of the categories we applied to a candidate. Your company should have a different set of criteria, but following the Micrel model is a great start.
We scored people on appearance, personality, written skills, technical expertise in the job being considered, cultural fit, verbal skills, an “overall” rating, and finally if the interviewer would consider the candidate for the hire (even if the interviewer was outside of the target department).
At Micrel, we looked for a composite score of seven or higher to even consider the employee. If the primary interviewer – the likely boss – would not consider the candidate for the hire, the prospective employee was not picked unless the application was kicked up to the next level and the decision was made there (very rare and under unusual circumstances). Otherwise, at least four out of the six people doing the interviewing had to agree to hire the candidate and the candidate’s composite score had to be seven or higher.
Knowing what you cannot know
There are some things you cannot tell in an interview, and that is why references are required.
A friend of mine once built a technical support team from the ground up. All the new employees were brilliant and outlasted my friend, with the exception of one fellow.
During the interview cycle, the candidate impressed interviewers. He was a solid personality fit, a good cultural match, and showed great drive. He also ended up being a chronic alcoholic who missed work after each of his only two pay cheques. None of this was even remotely apparent during interviews.
Reference checks are mandatory and the employee should supply at least three qualified references, not including their own family or friends; and these people must be technically within the area being considered.
Where possible, find two other references that a candidate did not list, be they former co-workers, bosses or even found with a deep scan of the employee’s social media accounts.
Hire above the wire
If you are lucky, you will have multiple, highly qualified candidates from which to choose. But sometimes you do not. Avoid succumbing to the temptation to hire less than the best.
An employee who doesn’t meet the minimum requirements, who doesn’t fit the culture, who leaves interviewers feeling flat, will only slow down your company. Leave slots unfilled until the right person arrives.
This article was originally posted here on Entrepreneur.com.
3 Pragmatic Tips For Start-Ups Making Those Critical Initial Hires
One survey found that the third leading cause of failure by startups studied was that they hadn’t built the right team from the beginning.
Nearly every business is guilty of making a less-than-stellar hiring decision at one point or another. A whopping 95 percent of companies surveyed by Brandon Hall Group for its Talent Acquisition study have admitted to this mistake.
While a bad hire can potentially slow down growth at any company, it can actually have a fatal effect on a startup. According to a report by CB Insights, the third leading cause of failure by startups studied was that they hadn’t built the right team from the beginning.
Creating a strong team means that each new hire (or promotion) must be made strategically and with great care, as the margin for error can oftentimes be quite small. Here are three tips to help you build a pool of talent that brings your start-up to the next level.
Define your company culture first
Startups, by definition, are small operations. They may even comprise just one person, so there might not be much of a company “culture” in place just yet. But when your culture does form, it will be a combination of your organisation’s values, beliefs and behaviours that have developed over time. The process of figuring out what this means for your new company makes that first hire that much more important.
Before you start looking for a new addition to your company, then, take the time to define your business’s values first. What mindsets and characteristics are needed to fuel your mission?
Peter Holten Muhlmann, CEO of Trustpilot, one of the world’s largest online review platforms, explained to me via email how his company does this:
“All your hires need to imbibe the company culture, the value of your brand and ultimately transfer it to your product,” Muhlmann wrote, “so that it is obvious to your customers what you stand for. A strong, value-based work culture built on integrity will raise the bar for your hires down the line for years to come.”
This CEO should know. Trustpilot employs more than 600 employees of 40 different nationalities across its seven global offices. If there is one thing he has ingrained in the workplace culture, he said, it’s that the success of his company – and the online review space in general – is completely dependent upon transparency and authenticity.
This is part of the reason why the Trustpilot platform remains “open,” meaning that its reviews aren’t moderated and brands can’t suppress negative reviews. It’s also why the task of maintaining Trustpilot’s core values and honest consumer feedback belongs not just to the company’s “compliance department,” but to every employee.
For your start-up, you should set objectives for short-term and long-term strategies to build the culture you want. This is why you should define values from the beginning, then use that knowledge to guide your hiring decision. The alignment of values must take place before new employees are brought on board.
Outline job roles and personality preferences
By the time start-up owners realise they need to hire someone, they’ll often be experiencing an overwhelming workload. With such a full plate, you may find it tough to know exactly which roles and responsibilities need to be filled. Since most new launches have not had the time or pressing need to clearly define job roles or organisational structure, it is important that entrepreneurs do so before bringing on a new hire.
Checking off technical skills needed is easy enough, but finding someone with the necessary soft skills to excel in the position is what really matters. Some 93 percent of employers surveyed by Wonderlic for its Hard Facts About Soft Skills report emphasised that they considered interpersonal skills and critical thinking vital to look for in a new hire. However, finding that perfect cocktail of hard and soft skills can be a challenge.
Big data technology has a solution, of course. AI-powered recruitment solutions like Harver can do wonders to eliminate the guesswork when it comes to making that initial hire. The system measures both aptitude and attitude by using big data to scour through candidates’ profiles and match their skill level to job descriptions. From there, it uses machine learning to evaluate the person’s soft skills, problem-solving abilities and alignment with the company’s values.
This leads to more informed hiring decisions and a vastly improved likelihood of finding the right matches. As Harver’s CEO Barend Raaff explained to me via email,
“The costs involved with replacing employees can be huge,” he wrote. “We believe that a new hire should fit two categories: skill match and personality match. Aligning both these elements is the key to making informed hiring decisions and reducing turnover.”
Take a step back and critically examine why you need to bring on a new hire. What responsibilities will he or she have? Why those responsibilities? And what skills will be necessary to fulfill this role? Failing to define these criteria will make it more difficult to find the perfect fit. So establish the personality and skillset you need, right from the beginning.
Understand How to Develop Talent, Not Just Find It
Unless you have a huge budget to hire someone with years of experience, one of your greatest challenges in hiring, as a start-up, is being able to spot potential. Furthermore, start-up leaders must understand how to properly develop the people they actually bring on board.
When you bring on younger talent with less experience, make it a point to check in and monitor that person’s development. A performance-management system like 15five can make it easier to accurately assess employee engagement across the board. The tool uses quick surveys to acquire feedback and keep up on issues like morale and performance.
Along the way to reaching your milestones, you can set goals and priorities, along with recognition systems. 15five opens up channels for employees to share their thoughts and suggestions with upper level management.
Overall, job stagnation is one of the top reasons why employees leave a position, according to Glassdoor.
Entrepreneurs thrive on growth and improvement. If you can commit to promoting these goals for your start-up, its outlook will only grow brighter as time goes on.
So, don’t fall victim to making a hasty hiring decision you’ll later regret. Setting a clear vision and defining important requirements is the way to identifying the perfect candidate; enacting a system that continues talent development is the way to keep that talent long-term.
This article was originally posted here on Entrepreneur.com.
5 Skills Every Marketer Should Have On Their Resume When Applying To Start-Ups
Wow them with skill sets businesses need to get started.
The field of marketing is incredibly broad and encompasses a wide variety of skill sets, from SEO and coding to website design and social media. Furthermore, marketing for a start-up business is much different than marketing for a traditional, corporate company. When start-ups look to hire a marketer, they’re going to look for different skills than a traditional company might need. The stakes are much higher when adding a new member to a one or two person team, as opposed to a large marketing team of 10 or 20 people. Considering 90 percent of all startups fail, the pressure is on to find someone who can wear multiple hats – and wear them well.
Startups typically have minimal resources to devote to marketing, and yet their marketing plan could make the difference between the success and failure of the business. Because of this, they’re going to look for someone who is energetic, creative, willing to learn through trial and error, and someone who can work independently. In addition to these personality traits, it helps to have some marketing skills that are specific to start-ups.
Below we’ve compiled a list of five skills that every marketer should have on their resume if they’re interested in applying to start-ups.
1. Knowledge of SEO and content creation
If you’re a writer, good at content creation and familiar with SEO, you’re golden to a start-up. Start-ups especially need help creating an online presence, and you can assist them in this by blogging and creating video content, as well as creating SEO goals and tracking your progress. Content creation is what’s going to make a start-up stand out to a customer, and consistent, valuable content will help create and maintain a lasting relationship with an audience. Some people would say that writing skills are even more important than industry knowledge because of this (but we can’t deny that it’s obviously ideal if you have both).
SEO is also imperative to a start-up, but it’s complex and requires a lot of time, so most small business owners need help in this area. Any knowledge of SEO strategies you have will be valuable to a start-up, and the good thing about this is that it’s easy to learn on your own.
2. Basic coding skills
You’ll be even more valuable to a start-up if you’re familiar with SEO strategies and have some basic coding skills. These two things typically go hand in hand, and oftentimes they’re lacking in the skill set of a startup business owner. Coding can help streamline a lot of processes, which is essential for a start-up that doesn’t have a large team or budget to work with. Don’t be turned off by the word coding. No one’s expecting you to be an expert. Some simple knowledge of HTML and CSS is sufficient and valuable for WordPress, email marketing, social media and more – and both these things are easy to learn.
There’s a ton of resources available on coding. It just requires some time to learn, and time is something that most start-ups don’t have. So if you come into the picture with this knowledge already, you’ll be sure to impress.
3. Data analysis experience
If there’s one thing that start-ups are swimming in, it’s data. Every day there is new technology being developed that produces large amounts of data faster than ever, and this is great, providing you know how to analyse and use this data to make good business decisions. Start-ups need a point person for data because it’s such a complex and time-consuming area of business. So much of a start-up’s marketing strategy comes down to trial and error, so show them you know how to create and run A/B test campaigns on your own.
Data is the core of content marketing, and companies are getting much better about using the data from clicks, conversions, keywords and more in order to track their progress, so show business owners that you not only know how to gather the data, you can make sense of it as well. I can almost guarantee it will be a huge weight off their shoulders and an invaluable skill.
4. Social media marketing
Social media is the place to get the word out about a new business, so knowledge of all the different social platforms is imperative. Many start-ups don’t have someone dedicated to social media, so it falls on the marketer. And keep in mind, many don’t see social media to be as time consuming as it really is. You should be familiar with the major ones like Facebook, Twitter and Instagram, and know how to tailor a marketing strategy for each site.
In addition, it’s helpful to know the niche sites that are specific to the start-up for which you’ll be working. Do your research ahead of time; do they have a large presence on Pinterest or LinkedIn? If they are not present on social media, can you suggest a platform that will work well for them?
The best way to show off your social media skills is to have an online presence yourself, so if you’re going to be talking about LinkedIn, make sure you have a great profile to use as an example. And if you’ve helped other businesses market themselves socially, make sure you include any tips and strategies that have worked well for you in the past. Case studies speak volumes, so don’t be afraid to brag a little (or a lot). This article will give you some tips on how to best optimise Instagram for SEO. You’ll be sure to impress during an interview.
5. Design skills
A start-up will need to develop not just their social media presence, but their brand as a whole, and this is where some design skills can come in handy. Most likely, they’ll still be working on their website, email design and internet marketing, so user accessibility is key. You can have the best business idea in the world, but if your website isn’t functional, you’re never going to succeed.
Take the time to learn WordPress backwards and forwards, as this is the preferred site for most start-ups. Familiarise yourself with the different templates (this is where some coding can also come in handy because even the best templates should be customised for each individual business) and create some example websites you can use to demonstrate your knowledge. Start-ups need to do more than just function; they need to look the part, and having some background in design can help them get that professional feel they’re striving to achieve.
This article was originally posted here on Entrepreneur.com.
Why You Should (Seriously) Stop Hiring People
Employing a whole bunch of people means you have a ‘real’ company, right? Wrong. The best thing you can do for your young company is to hire slowly… very slowly.
When does a start-up begin to feel like a proper business? For many people it comes down to two things: Renting a fancy office and hiring a whole bunch of people. And because these two things signify success in many peoples’ minds, founders tend to rush into them, hiring a bunch of employees and installing them in a freshly-painted office. However, according to Sam Altman, the president of Y Combinator, it’s the worst thing you can do as a founder.
“One of the weird things you’ll notice as you start a company, is that everyone will ask you how many employees you have. And this is the metric people use to judge how real your start-up is and how cool you are. And if you say you have a high number of employees, they’re really impressed. And if you say you have a low number of employees, then you sound like this little joke,” says Altman.
“But actually it sucks to have a lot of employees, and you should be proud of how few employees you have. Lots of employees end up with things like a high burn rate, meaning you’re losing a lot of money every month, complexity, slow decision-making, the list goes on and it’s nothing good.”
Growth is a good thing, of course, but the kind of growth is important to pay attention to. You want your sales to grow. You want your revenue to grow. You want your profits to grow. You don’t want your expenses to grow any more than is absolutely necessary to facilitate revenue and profit growth.
“You want to be proud of how much you can get done with a small numbers of employees. Many of the best YC companies have had a phenomenally small number of employees for their first year, sometimes none besides the founders. They really try to stay small as long as they possibly can. At the beginning, you should only hire when you desperately need to. Later, you should learn to hire fast and scale up the company, but in the early days, the goal should be not to hire,” says Altman.
“And one of the reasons this is so bad, is that the cost of getting an early hire wrong is really high. In fact, a lot of the companies that I’ve been very involved with, that have had a very bad early hire in the first three or so employees never recover, it just kills the company.
Early hires are tricky, argues Altman, because they are more like co-founders than employees. They will be entering the business when it is still young, so they need to be motivated by the same things that are motivating the founders.
If they need ‘management’ in the traditional sense, and if they care about things like working hours and number of leave days, they probably won’t work well in a start-up. So, when hiring an extra hand becomes an absolute must, you need to fight the urge to employ the first decent person you interview. Hold out for someone you could picture as your co-founder.
“Airbnb spent five months interviewing their first employee. And in their first year, they only hired two. Before they hired a single person, they wrote down a list of the culture values that they wanted any Airbnb employee to have. One of those was that you had to bleed Airbnb, and if you didn’t agree to that they just wouldn’t hire you. As an example of how intense Brian Chesky is — he’s the Airbnb CEO — he used to ask people if they would take the job if they got a medical diagnosis that they have one year left to live. Later he decided that that was a little bit too crazy and I think he relaxed it to ten years, but last I heard, he still asks that question,” says Altman.
Facebook’s Mark Zuckerberg was similarly careful about hiring in the early days. “Mark Zuckerberg once said that he tries to hire people that he’d be comfortable hanging with socially and that he’d be comfortable reporting to if the roles were reversed. This strikes me as a very good framework. You don’t have to be friends with everybody, but you should at least enjoy working with them. And if you don’t have that, you should at least deeply respect them. But again, if you don’t want to spend a lot of time around people you should trust your instincts about that,” says Altman.
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