Hiring the Right Employees

 A business is only as good as the people in it. Therefore, to effectively manage your business, you must take the time to find and hire the right employees.

This Guide discusses the process of staffing a business: setting the personnel policies, determining what skill and abilities are needed, finding applicants, developing application forms, and interviewing prospective employees.

Staffing is of critical importance to businesses of all shapes and sizes. All firms take the same risk in hiring a new employee. However, the smaller the firm, the less it is able to afford the time and costs involved in hiring and then firing, the wrong employee.

Bigger companies have developed effective hiring techniques and procedures to lessen this risk. If you, the owner-manager of a small to medium firm, are going to effectively manage your operation, you too must apply some of these staffing techniques.

Setting Personnel Policies

First of all, know yourself. Know what business you are in. Know your own personal abilities and weaknesses, and try to anticipate how you will deal with the situations that you expect to arise in the daily operation of your business.

Then, formulate your policies in writing. Include all matters that would effect employees, such as wages, promotions, vacations, time off, grievances, fringe benefits, and even retirement policies.

Employment and training procedures must be established so that you have a better chance of getting the job done the way you want it done. You might want to consider the way you want it done. You might want to consider written policy decisions for the following areas.

Hours

Consider here the number of hours to be worked per week, the number of days per week, evening and holiday work, and the time and method of payment for both regular and overtime work. Unnecessary payment of overtime at premium rates is a source of needless expense. By planning ahead, you may be able to organize your employee's work to keep overtime to a minimum. When peak periods do occur, you can often handle them by using part-time help paid at regular rates.

Compensation

The bulk of your employees' earnings should come from a base salary competitive with the pay offered by other similar local firms. It may be possible to supplement the base salary with some form of incentive, such as a small commission or quota bonus plan. Try to relate the incentive to both your goals and the goals of your employees. Whatever plan you use, be sure each employee understands it completely.

Fringe Benefits

You may consider offering your employees discounts on merchandise, free life insurance, health insurance, pension plan, and tuition payments at schools and colleges. You might also look into joining with other merchants in a group disability plan and a group workers' compensation plan. Such a plan could mean a considerable savings in your premium costs.

Vacations

How long will vacations be? Will you specify the time of the year they may be taken? With or without pay?

Time Off

Will you allow employees time off for personal needs, emergencies in the family, holidays, special days such as election day, Saturday or Sunday holidays?

Training

You must make sure that each employee is given adequate training for the job. In the smaller firm, the training responsibility normally falls to the owner-manager. But, if you have supervisors, each one should recognize the importance of being a good teacher and should schedule time to teach new people.

Retirement

What are your plans for retirement age benefits such as Social Security, pension plans, and annuity plan insurance?

Grievances

You may expect conflicts with your employees without regard for the quality of the employment you offer. The best course of action is to plan for them and establish a procedure for handling grievances. Consider the employee's rights to demand review, and establish provisions for third party arbitration.

Promotion

You will want to consider such promotion matters as normal increases of wages and salaries, changes of job titles, and the effect your store's growth will have on this area.

Personnel Review

Will you periodically review your employee's performance? If so, what factors will you consider? Will you make salary adjustments, training recommendations?

Termination

Even though this is a distasteful matter to many managers, it would be wise to have a written policy on such matters as layoffs, seniority rights, severance pay, and the conditions warranting summary discharge.

When you have developed your personnel policies, write down the policy on all matters which affect your employees and give each one a copy. Matters such as the following should be standardized and not left to the whim of a supervisor: hours of work, time recordkeeping, paid holidays, vacations, deportment and dress regulations, wage payments, system, overtime, separation procedure, severance pay, pension and retirement plan, hospitalization and medical care benefits, and grievance procedure.

Determining Needed Skills and Abilities

The trick is getting the right person for the job is in deciding what kind of skill is needed to perform the job. Once you know what it takes to do the job, you can match the applicant's skills and experience to the job's requirements.

The first step in analyzing a job is to describe it. Suppose, as a busy owner-manager, you decide to hire someone to relieve you of some of your duties. Look at the many functions you perform and decide what your stronger and weaker areas are.

Further suppose that you have decided that you will need help in the office. The phone is always ringing. Letter which need answering are piling up. Merchandise must be ordered.

Once you have a job description on paper, decide what skills the person must have to fill the job. What is the lowest level of skill you will accept? In this example, let us assume that you decide initially to hire a secretary, but discover that secretaries are scarce and expensive. Moreover, in your area, stenographers are almost as hard to find and nearly as expensive as secretaries.

Perhaps you could get by with a typist. Hiring a typist may be both easier and cheaper than hiring a secretary or stenographer. Many high schools students are well qualified as typists, and many are seeking part-time work.

One additional point: When you start to look for someone to fill your job, make sure you spell out just what you want. Imagine that an owner-manager advertised for a "sales clerk." What should the applicant be able to do? Just tally sales receipts accurately? Keep a customer list and occasionally promote your products to these people? Run the store while you are away? The job of "sales clerk" means different things to different people. Make sure you know what skills you need and what skills you can get by with, as determined by what kind of training you can give the employee.

Compare your financial plan periodically with real operations figures. With effective records you can accomplish this. Afterward,
where discrepancies show up you can take corrective action before it's too late. The right decisions for the ideal corrective
action depends upon your own knowledge of management methods in buying, pricing, selling, selecting and training staff, and
tackling other management problems.

You're thinking you can hire a bookkeeper or an Accountant to deal with the record keeping for you. Yes, you can. But remember two
very important details:

1. Supply the accountant with true input. If you buy something And do not record the amount in your organization checkbook, the
accountant can't enter it. Should you sell something for cash and do not record it, the accountant won't know about it. The
documents the accountant prepares will be no better than the information you provide.

2. Use the documents to make conclusions. If you moved to a doctor And he told you you were sick and needed certain medicine to
get well, you would follow his advice. Should you pay an accountant and he informs you your sales are down this season, do not
hide your head in the sand and pretend that the problem will go off. It won't.

Business Management Roll in Personnel Selection. If your business Will be large enough to require external assistance, an
important duty will be the selection and training of one or more workers. You may start out with family members or business
partners to help you. But when the business grows - as you hope it will - that the time will come when you must select and train
personnel.

Careful choice of employees is vital. To Pick the right Employees determine beforehand what you need each one to perform.

Then search for applicants to fill these particular needs. In a small Business you may need flexible employees who can shift from
task to task as needed. Include this in the description of all those tasks you wish to fill. At precisely the exact same time,
look ahead and organize your hiring to assure an organization of people capable of accomplishing every crucial function. At a
retail store, a salesperson may likewise do stock-keeping or bookkeeping at the outset, but as the company grows you will need
sales people, stock-keepers and bookkeepers.

When the job descriptions are written, line up applicants from whom To make a choice. Do not be swayed by clients who may suggest
relatives. In the event the candidate does not succeed, you might drop a customer as well as a worker. Some sources of possible
new employees are:

1. Recommendations by friends, business acquaintances. 2. Employment agencies. 3. Placement bureaus of top schools, business
schools, and colleges. 4. Trade and industrial institutions. 5. Help-wanted advertisements in local newspapers.

Your next job is to screen want ad responses and/or program Forms delivered by employment agencies. Some applicants will be
removed sight unseen. For each of those others, the application form or letter will act as a basis for the interview which should
be conducted privately. Put the applicant at ease by describing your business in general and the occupation in particular. As soon
as you've completed this, invite the applicant to speak. Picking the right individual is extremely important. Ask your questions
carefully to learn everything about the applicant that's pertinent to the job.

References are a must, and should be assessed before making a final decision. Check through an individual visit or a phone call
directly to the applicant's immediate former supervisor, whenever at all possible. Confirm that the information given you is
accurate. Consider, with conclusion, any negative comments you hear and what is not said.

Checking references can bring to light important information Which may save you money and potential inconvenience.

Personnel Training. A well-selected worker is only a potential Asset to your business. Whether he or she becomes a real asset
depends upon your training. Recall:

To allow sufficient time for training. Not to expect too much from The trainee in too short a time. To let the worker learn by
performing under real working conditions, with close oversight. To follow up on your training.

Check the worker's performance after he or she was at work For a moment. Re-explain important points and short cuts; bring the
employee up to date on new developments and invite inquiries. Training is an ongoing process which becomes constructive
supervision.

Personnel Supervision. Supervision is the next essential of employees control. Fantastic oversight will reduce the expense of
operating your company by cutting down on the amount of employee errors. If errors are corrected early, workers will find more
satisfaction out of their tasks and perform better.

Motivating Employees. Small businesses sometimes face particular Issues in motivating employees. In a large business, a good
employee can see An opportunity to progress into management. In a small business, You're the management. One thing you Might Wish
to Think about is to give great employees a Small share of their profits, either via part-ownership or even a profit-sharing plan.
Someone who has a"share of the activity" will be more Worried about helping to make a success of the business enterprise.

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