When to hire… and fire

by Mackenzie McCarty26 Dec 2011

Hiring – and occasionally firing – can be critical decisions for small broking businesses looking to maximise growth. How can you make the right decisions?

“The biggest cost for many small businesses is staffing, so the hiring decision is crucial.”
That’s the advice from Kellie Rigg, general manager of HR consulting at recruitment agency Randstad, who, as an organisational psychologist, is in a good position to know just how important the hiring decision – and at times firing – can be to a growing businesses.
Speaking with Australian Broker, Rigg said that small businesses need a more robust approach overall to recruitment – precisely because of the impact it will have.

1) Understand your business: The first step in hiring a new candidate is to understand the culture of your own business, and the types of skills, abilities and behaviours you need from the new individual in order for them to be successful. According to Randstad’s Kellie Rigg, this is something that businesses often don’t take time to do. “Often, they just jump in there and say I need to hire somebody, and don’t take the time to understand what they need to be successful within that role.” Rigg said that businesses should look at their top performers and assess the value they bring as well as their behaviours, and review what has been successful in the past. “It also comes back to looking at what types of clients they will be dealing with, and the experience they need – you need to target what they need to define success.”

2) Ensure recruitment rigour: Don’t default back to the “coffee and a chat” when it comes to interviews and recruitment. That’s the message from Randstad’s Rigg, who argues that a rigorous recruitment process is crucial to getting the right candidate in the door. “It’s about getting a better understanding of their skills and abilities, and also what transferable skills they have from previous roles,” she said. Rigg said this ideally should include “multiple methodologies”, including techniques such as psychometric assessment. “The aim of recruitment is to build a picture of who this person is, so you need to get as much data as you can get, including referees”. Part of this  is articulating clearly to the candidate what the role will be like, Rigg says.

3) Don’t stop there: The recruitment process doesn’t stop when someone has been hired and is sitting in the chair. It includes the crucial induction process; bringing someone into the business and setting them up effectively for success. “Make sure you have a well-structured first 90 days, so the candidate can learn all the skills they need to learn during that period, and you get them engaged and up and running,” Rigg says.

The other side

While finding the right candidates in the beginning is ideal, when you do make a mistake, knowing when to let someone go can be just as important to your business.

1) Follow a process: Letting someone go needs to be all about process, which means first understanding candidate performance and what is not working for the business. “A lot of small businesses don’t have key measurables like KPIs, which can be valuable in gathering data about whether the person is doing, or not doing their job,” Rigg says. If an issue has been recognised – and the business is doing everything possible to ensure the candidate is successful in their role – then it can be possible to coach, manage and turn the candidate’s behaviour around as a last resort. “We use performance enhancement plans. We say here’s your current performance, here’s where we would like it to be, and let’s work together to achieve that,” she said. In the end, it is about clear, open communication with the employee. “They have to know why they are or are not performing. They should know they haven’t been hitting targets, rather than just sitting them down and saying ‘Ok, you’re out’,” she says.

2) Avoid the negatives: If a candidate needs to be let go, Rigg says that as long as it is performance-based, it could end up having positive benefits on the business. “If you do have someone not performing or who is a negative influence, you could actually find that benefits other employees, who no longer have that negative influence.” However, Rigg says that such an event needs to be handled with care, as it could end up having negative effects on the workplace. “If it is a shock, it could have negative effects on other employees, if it is not clear, or they can’t see what the reason is.”

3) Consider flexibility: “Small businesses need to be agile and flexible, and staffing models need to be able to respond and react to that,” says Rigg. In a market that can be uncertain, Rigg said that contractors could be used to create a flexible working team, enabling easy adaptation to seasonal workflows. “If you have got work that is not consistent, and you are a little unsure about what the future holds, it could be an option,” she says. Rigg says the downside is they may not be as committed.

Firing is hard, not firing harder

The Selector Group’s Ian Jordan is no stranger to the “challenging” task of having to let staff go, although if it does happen again, the business may be more prepared for it.
“It’s happened a few times in our journey over three years, and there is no reason it couldn’t happen again, it’s just that now our radar is finer tuned to pick it up sooner,” he said.
By ‘it’, Jordan is referring to hiring someone who ends up not being a good cultural fit within the business, to the detriment of both the business itself, and the staff member themselves. Dealing decisively with the situation can be hard on all concerned.
“In some ways, it’s quite easy to say the person is just not fitting in with the business ideals, and where we want it to go, but on the other side of the coin, they might be quite competent or a nice person, so from an emotional point of view it is difficult for all parties concerned,” he said. “However, in the longer term, both you and them are better off,” he said.
Jordan said before letting individuals go, the business went through a process of close monitoring of team ceilings, how the team behaved when that person is around, as well as individual counselling, by communicating closely about any issues with the job.
Jordan says the experience has informed a more robust recruitment approach in future.
“Each time, there is a bit of a lesson learned, so your questioning techniques are more refined,” he explained. “You actually end up hiring a little bit slower; there is no rush to bring someone on, because in the past when we’ve come across someone with a good skills set, we may have said bring them on, without considering the deeper issues,” he said.