Eventually, most small business owners face the challenge of hiring and retaining employees—and it’s often a time-consuming and stressful process.
Holly Nowak, President and Lead HR Developer of HMN Resources, LLC, is a small business owner and human resources professional with more than 20 years of experience. Her work covers areas like recruiting, retention, team effectiveness, organizational communications and compliance.
When our Business Advisory Services team asked for advice, here’s what she had to say about hiring great employees and how small business owners can create a culture of retention.
First and foremost, hire the right people
Hiring friends and family members simply because it’s easier is a mistake. “Businesses live or die in the hands of your people, especially when you’re in the startup phase or yours is a smaller business,” says Holly. “Not having the right talent in place can be disastrous.”
Instead, she advises, hire the best people you can. While this will vary based on what
you can afford and the pool of candidates in your industry and area, be clear
about your needs in terms of experience, education, skills and management level,
as well as what’s essential and what can be taught.
As she points out, too, many deficiencies can be uncovered in the interview
process. That’s why it’s important to have a defined process to identify needed
skill sets. Let candidates do most of the talking. Holly recommends that 80% of
the time they should be telling you about themselves, and 20% of the time you
can tell them about the business and your needs.
“Often, business owners spend too much time selling the business. Instead, let candidates
talk. It’ll reveal whether they understand the position and have the mindset that
fits your industry, stage of business and culture,” Holly explains. “This may
be your only real opportunity before you make a hiring decision. And follow up
Make retention a priority
Too often, small business owners leave it to new employees to figure out how to navigate the workplace. And while some can, for many employees, this leaves them feeling disoriented and disconnected.
“Retention begins the first day,” explains Holly. “Every position should begin with an orientation. People need to know who their internal resources are and where to go with questions. It’s also important to give them a sense of culture and expectations.”
Offering a day or so of training, even for a straightforward position in a small company, gives new employees psychological space to find their footing.
“It’s easier to get employees off to a good start than to go through the hiring process again,” Holly says.
Ask for feedback
When it comes to gauging employee satisfaction, many business owners overlook the obvious source—the employees. Ask what inspires or motivates them and if they understand how their work contributes to the organization’s success. Then, give all employees a line of sight to the impact their work has on the client experience, such as introducing them to
customers who use services or products.
“Try regular employee surveys, too,” Holly adds. “And when employees leave, do exit surveys. Sometimes, it’s for reasons beyond your control—a move out of town or to raise children, for example. But when people you’d like to stay end up leaving, it’s important to know why. Maybe they didn’t see opportunities for growth? What did they need that they didn’t
get with your company? Find out, and you may be able to address it before you
lose another good employee.”
Get creative and don’t offer anything that you can’t afford to implement
When it comes to retention, there are a lot of ways that small business owners can get creative without breaking the bank. Employee recognition programs, for example, can bring attention to great work through simple gifts or notes—even recognition at a company meeting can be significant, because the point is the recognition (not the award). Or write a
media release and send it to local publications. Whatever you do, make sure it
aligns with your company’s goals and upholds the brand.
“For some companies, it can be insightful to offer a list of potential benefits and recognition strategies and have employees rank them,” says Holly. “Just don’t include anything that you
can’t afford or don’t intend to offer.”
Always encourage and recognize excellence
“Often, the most meaningful thing you can do is understand your employees’ interests and see if there are roles and responsibilities within the company that they can take on,” Holly concludes.“If someone in production wants to learn sales, can you manage that, even if it’s just to shadow or build a mentoring opportunity? These don’t cost much, if anything, and are important to creating that line of sight of the impact of their work, which makes a tremendous difference in how valued your employees feel.”