new employee

5 Interview Questions Every Small Business Owner Should Ask

James Clear — Sun, 04 Sep 2011 20:51:05 +0000

Link:

http://www.openforum.com/articles/5-interview-questions-every-small-business-own...

Hiring is one of the most important and critical tasks for any small business owner. After all, your business is only as good as your people.

But how do you know who the good people are? And how do you determine which candidates will perform to your expectations? Anyone can put on a good show for a few hours during an interview. What you want are people who will still be good in a few months.

Nothing is certain, of course, but the five questions below will help you see deeper into the candidate's mind and make the decision that is best for your business.

1. Give an example of a time when you had to make a quick decision.

Small businesses are, by definition, small. That means that everyone has to share the responsibility. You need employees who can take initiative when necessary and make a decision when it needs to be made. This question forces candidates to demonstrate that they have had to deal with these make-a-call-and-make-it-now circumstances.

2. Give an example of a time when you exceeded expectations.

This question gives the candidate a chance to brag about their accomplishments, but the real value can be found in analyzing their approach and thought processes.

Some candidates exceed expectations because little is expected of them in the first place. Others exceed expectations because they understand the root causes of a problem and the nature of the circumstances ... and then they take action based on those understandings.

You'll know if you’ve found the latter based on how the candidate describes the problems faced and their approach to the situation.

3. Convince me that you can adapt to a wide range of people, situations and environments.

The goal of this question is two-fold.

First, employees that can adapt to a variety of circumstances are crucial in a small business environment. At some point, it's very likely that they will be asked to do something that is outside their normal job description. Employees have to be OK with that and capable of handling such a change.

Additionally, you are asking them to convince you of something. This will give you an insight into how persuasive the candidate can be. Persuasion is critical in small business. In many situations, you are competing against businesses with more money, more resources, and more contacts. If you can't be persuasive, then you will lose.

4. What have you done that demonstrates initiative and willingness to work?

In all likelihood, your employees will be trained on-the-job. It is important to hire individuals that take action and aren't afraid to get into the thick of things. There are few rotational leadership programs or well-organized training courses in small business. Employees need to be ready to jump in and willing to work through the sticking points when they come along.

Moreover, running a successful small business is all about trust. You need employees that you can depend on and believe in, even when you aren't around. If you fill your office with individuals that are self-motivated and take action, then you can be sure that business is moving forward.

5. Why should we hire you?

In a small business environment, candidates will have to prove themselves over and over again. Give them a chance to prove themselves right away!

This question is the perfect way to open things up and allow the candidate to show you what they bring to the table. It's also an opportunity for them to display talents that you might not have thought to ask about during the interview.

Sometimes the most compelling qualities are hidden within our stories. A good hiring manager can pull those stories out as the conversation progresses and this question helps to accomplish that.

This article is from James Clear of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Hiring the Best: Go Beyond Asking Questions in an Interview

Thursday Bram — Fri, 03 Jun 2011 23:54:31 +0000

Link:

http://www.openforum.com/articles/hiring-the-best-go-beyond-asking-questions-in-...

Finding the perfect employee for your business can be difficult. Depending on the size of your business, you may not have a separate human resources department. You may also have limited resources you can commit to a search for job applicants.

Contrast that with the exhaustive process (and extensive resources) used by online footwear retailer Zappos. At Zappos, hiring is just the beginning. From there, new employees go through a four-week training program and then spend two weeks on the customer service lines, no matter what position they’re hired for. Zappos has become well known for this process, as well as a special offer the company makes to each new hire after the first week of training. If new hires agree to quit immediately, they can walk away with $2,000 in their pockets.

The entire on-boarding process ensures that new employees are just as dedicated to Zappos as employees who have been with the company for years. But it’s probably not a practical option for smaller businesses. Nevertheless, innovative small businesses can go beyond the standard interview routine to find the right employees.

Dig Deeper than the Interview

Interviews are a mainstay of the hiring process. They provide a way to get to know an applicant, but they don't say much about how well the candidate will perform nor how she'll fit in with you and the rest of the team.

To help her get a better sense of applicants, Alicia Vargo of Pampered Passions uses card, board, and strategy games.

“I don’t play an entire game of chess with an applicant," she says, "you can imagine how time consuming this would be – however I sit down and either play gin rummy or chess with our applicants. Of course, they look at me quite strange.”

Despite the odd looks, Vargo’s method gets results.

“When I sat down with one applicant, she was quite competitive, and frustrated with her mistakes. She was concerned about winning the game, and winning only. She was quite insecure at the same time about her strategies. Ultimately she was throwing her hands in the air, could not believe she was making the decisions she was making on the board, and gave up after about ten moves. She had mentioned that she was an excellent chess player prior to me taking out the game."

Form this experience, Vargo surmised a few things about the candidate:

She may be a perfectionist;
She may not be a team player;
She may give up in a challenging circumstance;
She may not be a problem solver;
She could not take the time to breathe through her frustrations.

The result? "She was not a candidate we hired," says Vargo.

The Handwriting on the Wall

Chess and board games aren't your only alternatives. While a variety of assessment tests have become commonplace in the hiring process, Sheila Lowe’s handwriting analysis stands out. Lowe provides employers with a deeper insight into the people that they may hire and her analysis has proven out for her clients. “I had provided an analysis of a woman who was applying for outside sales. In my report I noted that while she had many fine qualities for the job, her strong sensitivity gave her tendency to blow up at the slightest provocation. While not all my clients share with their applicants that their handwriting is being analyzed, this particular one did. He told the woman what my report had said and – she blew up.”

Lowe’s efforts provide employers with an additional layer of information about a candidate. “I never tell a client that they should or shouldn’t hire someone," she says, "but my analyses provide objective information (I never meet the applicants) that they can add to their impression in the interview, application, skill testing, background check. I’m not there to stop good people getting a job, but to help the employer make sound choices. In most cases, it’s not poor job skills that cause people to lose their job, it’s personality problems.”

Show, Don’t Tell

Many applicants will come to you with impressive resumes – but a resume doesn’t tell you how they really do their job and how they fit in with your team. Having a prospective employee actually get down in the trenches and do a trial project (paid, of course) can give you a much clearer picture of how they’ll actually work for your company.

Sara Sutton Fell is the CEO of the jobsite Flexjobs.com. Applicants to her company are asked to complete an exercise that shows how they would perform in the real world.

“One of the positions is a researcher role," Fell says, "so we gave the candidates similar guidelines that our current researchers have, and asked them to take a half hour and submit the results of the research guidelines. It gives us a great insight into (a) their current level of understanding of the job; (b) the quality of their work; and (c) in what areas they may need training. "

Because her current researchers are already experts, she includes them in the process, helping her "grade" candidate responses. “We had four candidates who just knocked the research component out of the park, with their submitted results being 100 percent usable and up to our current standards, with absolutely no training. The other submissions ranged on the spectrum, with about half of them ensuring their progress to the interview stage.”

Fell's process has resulted in positive responses from applicants, as a general rule. After all, many potential hires aren’t sure how a company really operates until they land the job and start work. The test offered a glimpse of what applicants were applying for. The insights that a work exercise such as Fell's research test provides can be beneficial to applicants as well as the companies interested in hiring them.

This article is from Thursday Bram of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

6 Steps to a Good Hire

Ken Kaufman — Sun, 13 Mar 2011 21:31:40 +0000

Link:

http://www.openforum.com/idea-hub/topics/managing/article/6-steps-to-a-good-hire...

Whether your business is growing, shrinking, or has leveled-out, knowing when to make changes to your employee head-count is never easy. To help you through the process, here are six steps to make sure you’re making the right decisions when it comes to your most complex, critical, and expensive resource – your people.

Step 1: Revenue per Employee

Before you consider making any changes to your staff, start by calculating your revenue per employee. In his OPEN Forum article, Mike Periu identifies revenue per employee as The Most Important Ratio for Your Business. Compare where you stand with your historical performance and with others in your industry. This metric, more than any other, will let you know when you should hire, fire, or hold.

Step 2: Consult Your Financial Model

If you don’t have a detailed, five-year financial model for your business, then you should create one. Whether you are putting your first financial plan in place or you have been using one for years, make sure it has a detailed staffing plan that correlates to your plans for growth. After all, the first or second largest expense in every business is people. That’s deserving of some detail, not a lump sum number lacking context and modeled assumptions.

Your financial model show a realistic revenue per employee number as your company grows, and it should also be well thought-out in terms of the mix of employees between the core activities of your business – marketing, sales, operations, customer service, accounting/finance, human resources, legal, quality, R&D, and so on. When deciding to hire or fire, the financial and operational ramifications can be answered if you keep your five-year financial plan up-to-date and consult it before you take action.

Step 3: Consider All Other Alternatives

Employees are fixed costs, but they are so much more complex than all of the other expenses in a business. You build relationships with your employees and invest a great deal of time in trying to help them be successful in your organization. If you’re thinking about hiring, remember the last time you had to let someone go. Terminating an employee is never an easy job, especially when you are aware, through your relationship, of the ramifications it will have on the employee and his/her family. Consider how processes and technology might be leveraged as much as possible in lieu of hiring, holding off as long as possible.

Step 4: Know Sales Equivalency

Do you know how much your business must sell to cover the cost of an employee? Assuming their wages do not fall into the direct labor category of your costs of goods sold, you can figure out the sales equivalency to break even on each new hire. Take the annual cost of the new employee you are going to hire, including payroll taxes and benefits, and divide it by your contribution margin, which is the percentage of sales left after you subtract all of your variable costs. Your hiring decision should create a “yes” answer to at least one of the following three questions. Will the new hire generate at least their sales equivalency to break-even? Will the new hire save the company at least the cost of their total compensation package? Will the new hire improve productivity to generate enough additional revenue or cost savings to justify their hire?

Step 5: Perfect Candidate to Well-Defined Job Description

Before you hire, spend some time and effort to correctly define what the person will be doing. I know this may sound elementary, but most entrepreneurial companies fail to create clear expectations, mainly because the position is new to the company and the existing team may have never hired someone for a similar position before. You will save yourself, your team, and your new hire a lot of frustration and wasted effort by creating a well-defined job description and then finding the perfect candidate for the job.

Step 6: Proven Program to Retain

Even if you hire the perfect person for the new position, it will be worthless if you do not retain this new employee, and all of the rest of your employees for that matter. Some studies estimate the cost of employee turnover to be as high as 30% of the employee’s annual total compensation. Assuming the most recent employee that left your company had a total compensation package of $45,000/year, that means their departure cost your organization $13,500.

I recently met the President of a successful and growing company who explained his philosophy for retaining employees. He said that his job as the President is to take care of the employees. In return, his employees will take care of and serve the customers. Then the customers will take care of the company, which will allow the company to take care of him. With this focus, entrepreneurs should create a program and an environment within which their employees can thrive and fulfill their professional interests.

When you hire someone to join an organization like that, you're all bound to succeed.

This article is from Ken Kaufman of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread: