Hiring new staff will always have an element of risk. The business fundamentals that have enabled the hire can change (like with the pandemic) and there’s the inherent risk of that staff member itself. Will they have the skills to do a good job?
With the unemployment rate at historic lows, for SME owners, the risk they take on increases. Open positions cost money in more ways than one — increased burdens on existing staff, the opportunity cost of not pursuing value-adding services or projects.
Historically low unemployment makes for fierce competition between employers. There’s nothing wrong with competition — but it should also be fair. The reality is it’s anything but that; bigger companies can often offer more pay, and better work conditions. I do not envy anyone who is looking to hire and grow an SME in today’s environment. The odds are stacked against you.
But hire you must, so, you end up doing what I call ‘hope hiring’. You create a list of the skills you think are needed to get the job done, and when someone ticks those boxes you give them an offer and hope it works out.
I’ve done my fair share of ‘hope hiring’, having helped build Xero’s business for nine years in Australia and now joining Compono to start that thrilling journey once again. I know how painful it can be when a hire doesn’t work out. From simple incompetence to those who seemingly set out to create discord wherever they go, I’ve seen it all.
The next stage in your hiring journey will then be to come up with your own method for sorting the wheat from the chaff — somewhat infamously, my ‘coffee cup test’ made headlines around the world. It was a simple concept, all I did was take the time to notice what they did with their coffee cup after the interview. Was it left on the table for others to clean up, or did they bin it themselves on the way out?
I had noticed, over the years, that what really made someone good wasn’t the skills they brought to the table. It was the attitude they had towards work and towards others. If they had the right attitude but not the skills, this was often fixed quite quickly either through on-the-job training or additional courses.
The inverse — right skills, wrong attitude — was almost always impossible to fix. You cannot teach attitude, only skills.
What doesn’t get a lot of attention is my view today that my ‘coffee cup test’ back then was employer voodoo. It didn’t hugely decrease the bad hires, it just made me feel a bit better in the moment about a hiring decision.
Many of the ‘bad hires’ I made went on to do great things – my organisation just wasn’t the right fit for them, and vice versa.
What I was missing, and what most employers miss (large or small), is that the hiring process needs to involve some introspection.
What sort of person thrives in your company? What are they going to be motivated by? What can you offer them that speaks to that motivation?
Only then, when you can answer these introspective questions, can you build a better recruitment process. Sure, if the answer to the above question is purely ‘money motivated’ you’ll struggle against bigger employers who can simply outbid you in the war for talent.
There are however many other types of people out there who are motivated by other things. An obvious example is the rise of remote work creating a whole new class of worker, and enabling many more people to potentially take on work than pre-pandemic. Many talented people struggle to find employment because of a need for wheelchair access, are located remotely or have routines that mean they need to work atypical hours. Giving them a stable, career-building job opportunity can be incredibly rewarding for both parties.
Tapping into that job talent pool will often require some changes within your own organisation, which brings us back to the point of introspection. If we’re looking for a long-term hire, can we offer a remote worker a stable environment that’s digitally-savvy enough to not isolate them? Do we have a culture where we’re competitive or collaborative? How would a remote worker fit into that mix?
Like many things in life, the first step to winning the war on talent is to look within ourselves. If you can get that bit right the results will surely follow.
Trent Innes is the CEO at Compono, non-executive director at Uptick, board observer at Mr Yum, a former managing director at Xero, and an investor and scale-up advisor.
