Financial Fiix

Interviewing and hiring the right candidates will help avoid job turnover and expand your company

Sponsored by Vantage West.
                   

Congratulations! Your ingenuity and hard work have proven so successful, you are ready to expand your workforce so you can continue to grow your business.

Whether you are considering hiring your first employee or adding to existing staff, there are several guidelines that will help make the decision process easier. 

Your backlog threatens to disrupt the flow of business. In some businesses, a certain amount of backlog represents job security. As long as you are able to deliver to your customers at the agreed upon time, there isn’t a problem. But, if you are missing deadlines and finding yourself simply maintaining your business rather than growing it, it is time to hire before you risk losing customers.

You can clearly define the positions. The first step is to list the tasks your new hires will undertake. If this will be your first employee, begin with the most repetitive duties. Answering the telephone, handling incoming and outgoing mail, responding to email, managing social media engagement, filing, and communicating with vendors are examples of routine office procedures. A product manufacturer may have a more immediate need to hire someone to help with production.

Once the list of duties is complete, the desired skill set of the employee will emerge. Calculate the number of hours needed to accomplish the requisite daily work to determine whether you need to fill a full-time position, or hire a part-time employee or temporary worker, or possibly expand your workforce by several additional team members.

Income and payroll numbers warrant additional headcount. For manufacturers, payroll should represent no more than 30 percent of your company’s gross income. Service businesses can successfully operate with higher payroll costs because they do not have the expense of materials. But, it is recommended service enterprises stay below 50 percent of gross income. Applying this rule will also help answer the question of which person you should hire. Individuals with a wide range of knowledge, abilities, and experience, along with those who have highly specialized backgrounds, offer a high level of efficiency but command higher salaries. 

Entrepreneurs tend to admire those they consider smarter than themselves. Surrounding yourself with people smarter than you is a common business mantra. Bear in mind, the most skilled and intelligent people may not be the most practical choices for the position you are offering, either financially or collaboratively. In addition to the ability to perform the duties of the job, the new employee will need to fit in with the office culture, have a good work ethic, and display passion for their work. 

You are prepared to invest time and resources in hiring additional staff. There is time spent identifying the scope of the position, reading resumes, interviewing candidates, and money spent on posting the job. After the person is hired, they will need to be trained. It is important to give every step in the process serious consideration since you want someone who will fit in well with other employees. Avoiding job turnover will help preserve precious resources and create a knowledgeable, competent staff that will help your company expand faster.

In the end, there are several factors that go into moving forward with your decision to grow your employee base.  The decision is unique to each business, but hopefully these tips will help you make the best decision for your small business.  

 For more insights from Vantage West, visit their blog at:  http://blog.vantagewest.org

Rene Almazan is a senior vice president for Vantage West Credit Union, a $1.7-billion financial institution in Arizona, which serves a growing membership of more than 145,000 via branches across Arizona and online channels, as well. Vantage West offers consumer and business banking services, and is federally insured by NCUA. vantagewest.org