You have probably heard this over and over again, but a company (no matter its size or industry) can only be as successful as the people who work within it.
This is particularly true for a small- to medium-sized business (SMB). Your employees interact with your customers and partners. They make your products / services better. They represent your brand. Therefore, it is extremely important that you hire the right people.
Tony Hsieh, the well-known CEO of Zappos, has estimated that his own bad hires have cost Zappos well over $100 million. But that is just one statistic. Thanks to tangible (recruiting, hiring and onboarding costs, etc.) and intangible (morale and productivity, etc.) costs, the true cost of a bad hire can range widely.
The U.S Department of Labor, states that the true cost of one bad hire is at least 30 percent of the employee's first-year earnings.
In a survey conducted by the Society for Human Resource Management (SHRM), 41% of hiring managers estimated that the cost of one bad hire is in “the thousands of dollars.”
CareerBuilder reports that the majority of employers surveyed stated that a single bad hire costs more than $50,000.
But does the real number really matter? The truth is that many (if not most) SMBs simply cannot survive a multi-digit investment in the wrong employee.
And this makes it incredibly difficult to hire great employees. It take time, dedication, some skill, and an inherent knowledge of what you want your SMB to be when it grows up.
But now is not the time to despair. There have been many that have (successfully) gone before you and succeeded. Therefore, here are 12 key pieces of hiring advice from some of most successful CEOs ever ― many of whom started out as company founders and SMB executives as well.
- “I will only hire someone to work directly for me if I would work for that person.” ― Mark Zuckerberg, CEO of Facebook (Translation: As a company leader, it is not only your job to lead but to identify those who may [one day] lead beside you or fill your role.)
- “If you always hire people who are smaller than you, we shall become a company of dwarfs. If, on the other hand, you always hire people who are bigger than you are, we shall become a company of giants.” ― David Ogilvy, founder of Ogilvy & Mather (Translation: Look for ambitious, talented, motivated people who can make the company greater than the sum of its parts.)
- “You can dream, create, design and build the most wonderful place in the world… but it requires people to make the dream a reality.” ― Walt Disney, founder of The Walt Disney Company (Translation: Find people who “get” your dream and want to work to make your dream a reality.)
- “Start with good people, lay out the rules, communicate with your employees, motivate them and reward them. If you do all those things effectively, you can’t miss.” ― Lee Iaccoca, former president, CEO and chairman, Chrysler Corp. (Translation: Always keep the lines of communication open. When all employees know what is expected from them, they will be motivated to do better. Oh, yeah… and reward their efforts.)
- “Somebody once said that in looking for people to hire, you look for three qualities: integrity, intelligence, and energy. And if you don’t have the first, the other two will kill you. You think about it; it’s true. If you hire somebody without integrity, you really want them to be dumb and lazy.” ― Warren Buffet, CEO, Berkshire Hathaway, Inc. (Translation: Integrity and strong work ethic are indispensable for the success of your SMB. Without integrity, you have nothing.)
- “If you can hire people whose passion intersects with the job, they won’t require any supervision at all. They will manage themselves better than anyone could ever manage them. Their fire comes from within, not from without. Their motivation is internal, not external.” ― Stephen Covey, author of 7 Habits of Highly Effective People and co-founder, Franklin Covey (Translation: Qualified, passionate, efficient people will be dedicated to their jobs and will not have to be micromanaged. This allows SMB executives to focus on what they should be focusing on ― leading and growing the company.)
- “It’s very important in a restaurant to really do the right hiring, because there’s no restaurant that you have one cook and one chef and nobody else in the kitchen.” ― Wolfgang Puck, chef & restaurant owner (Translation: Restaurant example aside, to keep a business running well, you need a diverse team. You need strategists and visionaries, but you also need the tacticians who can make those visions come to life.)
- “It doesn’t make sense to hire smart people and then tell them what to do; we hire smart people so they can tell us what to do.” ― Steve Jobs, former CEO, Apple and co-founder, Pixar (Translation: When you give your superstars freedom, you give them the opportunity to impress you.)
- “When I started Oracle, what I wanted to do was to create an environment where I would enjoy working. That was my primary goal. Sure, I wanted to make a living…But I really wanted to work with people I enjoyed working with, who I admired and liked.” ― Larry Ellison, executive chairman & CTO, Oracle (Translation: Working in an environment [and with people] you enjoy is energizing. The energy builds on itself in a positive manner, providing more energy to put into work and success. When the workplace is stifling and the work is a grind, you drain your energy reserves, leaving your employees drained and depleted. At some point, the work suffers and the growth grinds to a halt.)
- “If you’re not spending at least 50% of your time hiring ― and that’s the minimum ― you’re already on the road to failure.” ― Robert Hayes, Partner, First Round Capital (Translation: Do not delay hiring. If you find great talent for a position you know you will need to fill soon, hire that person. It is well worth the couple of extra months of salary to bring on board a talent you may never find again.)
- “As the last step in the recruiting process, apply the Shopping Center Test. It works like this: Suppose you’re at a shopping center, and you see the candidate. He is fifty feet away and has not seen you. You have three choices: (1) beeline it over to him and say hello; (2) say to yourself, ‘This shopping center isn’t that big; if I bump into him, then I’ll say hello, if not, that’s okay too’; (3) get in your car and go to another shopping center. My contention is that unless the candidate elicits the first response, you shouldn’t hire him.” ― Guy Kawaski, author, Silicon Valley venture capitalist, chief evangelist of Canva and co-founder of multiple Silicon Valley startups (Translation: Hire the best candidates, and to do that you might have to listen to your gut. But if you have no idea if your gut is telling you to hire the candidate or that it needs a pastrami sandwich, use the “Shopping Center Test”.)
- “I surround myself with people who have knowledge and talents in areas where I might not be so well versed.” ― Richard Branson, founder of the Virgin Group (Translation: Hire for your weakness. This is especially true at the beginning, when you need what Branson calls “a healthy level of delegation” to grow.)
With the right advice and the right technology, your SMB can recruit and retain the best talent to support your growth. With Oracle HCM Cloud and Oracle know-how, you can have both.