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What is a hiring plan? Why are hiring plans important for a business?
Employees are an essential part of a business, and to have employees, you need to create a hiring plan. This process may be intimidating, but it’s important to ensure you’re hiring the right people to fit your team.
Continue reading for a step-by-step hiring process that works for any business.
Planning: Identify Your Specific Needs and Goals
Before making a hiring plan, you need to think of the goals you want to meet for your business. In The E-Myth Revisited, Michael E. Gerber says creating a franchise prototype helps you put your hiring plan in perspective. This way, you’ll cater your business around your life and your future employees’ lives. Try this exercise for reconceptualizing your business. Think of it as the prototype for thousands of others like it.
Imagine you’re going to franchise your business with the following guidelines. How would your franchise prototype look compared to the way your business looks today?
1) Your model will provide a level of value to your customers and everyone else your business touches that’s consistent and exceeds expectations. The answer to how your business will provide value is the reason for its existence. Your customers, employees, and suppliers, not you, define the value your business provides. It’s reflected in such things as the way you greet customers and recognize/reward employees, the price of your service or product, or the time you spend answering a customer’s questions.
2) Your model can be applied by people with the minimal skills necessary for each position. If you base it on highly skilled people, you’ll have a harder time filling positions and you’ll pay more. Further, your model will be hard to reproduce.
Make your business dependent on systems rather than people. People can still help you improve your systems by finding ways to serve customers better. But when your business is people-dependent, it’s subject to their moods—you have to motivate them—and can’t produce consistent results. Your system is a tool you develop and use to teach people to do the work of your business and differentiate it from competitors.
3) Your model provides organization and order. There’s more than enough chaos in the world; most people are looking for order. A business that appears organized gives your customers, employees, and suppliers confidence that it can deliver the results they want.
4) Your model is documented in an operations manual. Documentation provides your employees with clarity. It explains the purpose of the work, the steps for doing it, and the standards that must be met. Without documentation, everyone creates their own processes and standards.
When you can answer these questions, you’ll be thinking of your business in a new way and officially begin hiring to fulfill your needs.
TITLE: The E-Myth Revisited
AUTHOR: Michael E. Gerber
Recruitment: The Interview Process
Now that you have your goals set for your business, The Making of a Manager’s author Julie Zhuo recommends making a hiring plan: a list of roles you need to fill over the next year based on your company’s goals and vision as well as deficiencies among your current team. A one-year hiring plan will help you clarify the skills and experiences you’ll need future team members to have and when you’ll need to have those positions filled.
Once you start your hiring efforts, Zhuo recommends these steps to find and interview candidates:
Step #1: Create a clear job description and title. Clarify core job duties, and be specific about the skills, experiences, and qualities you need. For example, if you need a project manager who’s detail-oriented and great at calmly navigating difficult conversations with strong personalities, be sure you note that preference.
Additionally, candidates look for job titles that fit their qualifications, so be sure you choose job titles that are easy to understand. For example, “receptionist” is a better choice than “director of first impressions.” Also, avoid superfluous language that’s overly complicated so candidates can easily understand what’s expected. For example, instead of “interfacing cross-functionally and troubleshooting interdepartmentally,” simply say “collaborating with team members from different departments.”
Step #2: Decide where you’ll look for candidates. Zhuo recommends asking colleagues for recommendations before looking anywhere else. If none of their suggestions work out, you now have an idea of what kind of person to look for elsewhere.
Others claim that seeking hires via a recruitment agency is the best approach in certain circumstances. For example, agencies are especially useful for finding candidates to fill leadership or highly technical positions. They often have staff members with expertise in particular industries, which enables them to spot employees with specific skills that you might overlook. Using a recruitment agency can also free you to focus your efforts elsewhere, thereby saving you—and your company—time and resources.
Step #3: Prepare a template of interview questions. Be clear about what you want to learn, and use the same questions for each candidate interviewing for a single role. As Zhuo says, this helps you compare candidates based on the quality of their answers rather than subjective impressions.
To prepare for interviews more efficiently, consider conducting software-assisted interviews. Software tools generate interview questions for you based on your specific job requirements and help you evaluate candidates. These tools can also decrease bias in your hiring decisions by scoring candidates in a way that’s potentially more objective than in-person judgments.
Step #4: Invite colleagues to help you conduct interviews. According to Zhuo, this can diminish bias that often interferes when only one person is involved and can help you catch warning signs you might overlook if you’re on your own—for example, a candidate who won’t make eye contact with female interviewers.
What’s the ideal number of interviewers to include? Zhuo doesn’t say, but others recommend a maximum of three people. More than three may intimidate and confuse candidates, making them feel like they must remember many names and the role each person has in the organization. Also, including more interviewers than necessary tends to make decisions about candidates more challenging, as it’s rare for multiple people to be perfectly aligned in their opinions of candidates’ strengths, weaknesses, and fit with the company culture.
Step #5: Conduct memorable interviews. Avoid distractions and devote your attention to candidates so they know you consider them a priority. Also (if you think they’re likely to be a good hire), describe the difference you see they’ll make when they’re on your team, and tell them how excited you are to welcome them to the company. As Zhuo says, you need to make sure candidates see your company as an attractive place to work.
In general, when hiring for a position, your goals should be to:
- Choose a top performer
- Teach her about yourself and the organization
- Figure out if you’re a good fit
- Get her excited about the job
The Ideal Team Player by Patrick M. Lencioni gives some sample interview questions for assessing each team player’s virtue.
- “Describe your most important career accomplishments.”
- Look for use of the word “we” more than “I.”
- “What was your biggest failure?”
- Humble people don’t hesitate to answer because they know they’re not perfect. They take responsibility and learn from failure.
- “What’s your biggest weakness?” This is a cliche question, but it can be revealing. Candidates who spin weaknesses as strengths may be afraid to acknowledge shortcomings. Counter this by asking people what they’d like to change about themselves.
- “Describe a time when you worked really hard on something.” Look for passion and excitement for the project, rather than complaints about workload.
- “What do you like to do outside of your job?” A long list of outside interests might indicate the person will put those interests ahead of team interests or be reluctant to step up and do extra work at key times.
- “What work did you do as a teenager?” A work ethic forms early in life.
- “What hours do you usually work?” Highly motivated people don’t usually limit their hours to 9 to 5. Emphasizing predictable hours or “balance” may suggest a candidate lacks drive, although this isn’t always the case.
Observing a person’s behavior in different situations is a better way to gauge interpersonal skills than asking questions—for instance, noticing how she deals with waiters, receptionists, and potential coworkers. However, questions like the following can add information:
- “How would you describe your personality?” The person should be introspective and the description should jibe with your observations. If he has trouble answering the question, he might lack self-awareness and therefore be bad at dealing with people.
- “What kind of people bother you the most and how do you respond to them?” Look for a willingness to work constructively with others.
- “Would others describe you as empathic?” Or, “Can you give an example of when you showed empathy at work?” The answer should indicate an awareness of and concern for others’ feelings.
After the interview, ask yourself whether you’d want to work with the person every day. People with strong interpersonal skills obviously are easy and fun to work with. This question doesn’t fully address whether the person is humble or hungry, but it tells you your gut feeling about them.
You must also acknowledge that creating a hiring plan is hard. In High Output Management, Andrew S. Grove says that evaluating the potential performance of a stranger is even more difficult than evaluating established employees. There’s no foolproof way to hire—even if you follow all of Grove’s recommendations below, you might still end up with a bad hire.
The goal of interviewing is to predict how an applicant would do at your company based on her self-assessment of her own abilities. There’s no way to avoid using self-assessment at the interview stage of a hiring plan because you don’t have access to objective measures of skills, performance, and other factors. However, even though self-assessments can be inaccurate, they can still provide good information if, as the interviewer, you’re blunt and direct, because this usually inspires similar directness in the applicant.
Here are some hiring plan tips for interviewing that Grover provides:
Tip #1: Aim to learn the following types of information:
- Technical skill level. Ask her to describe a project she’s completed or about her skills and weaknesses. This will tell you if she’ll be able to do the job you’re hiring for.
- Ability to apply skills. Ask questions about previous successes and failures to determine if the applicant knows how to actually apply her skills.
- Discrepancy between knowledge and actions. If a person is capable but didn’t perform, find out why. Ask about issues at her current job and what she’s learned from past mistakes.
- Values. Ask why she wants a new job and why she feels your company is a good fit. Her values will tell you how she will approach the job.
Tip #2: Listen. The applicant should talk 80% of the time so you can learn as much about them as possible.
Tip #3: If the applicant gets off topic, interrupt her and tell her you’d like to change the subject. You only have an hour or two—use it wisely.
Tip #4: Use the same language and make sure you both understand the meaning of any jargon you use.
Tip #5: Ask the applicant to consider a hypothetical situation. For example, when Grove was interviewing an accountant, he asked him to determine the cost of a finished wafer. Grove explained the wafer manufacturing process and answered questions about the process, since the accountant didn’t know how it worked, and the accountant worked out how to determine the price.
Tip #6: Ask the applicant if she has questions. This will show you if she prepared for the interview, if she researched the company, and what she’s looking for in a company.
Tip #7: Don’t use tricks—for example, giving applicants a broken chair and then seeing how they react when they fall. Instead, give a realistic first impression of yourself and the company because it takes first impressions a long time to fade, and encountering tricks during an interview suggests there will be tricks and traps on the job too.
TITLE: High Output Management
AUTHOR: Andrew S. Grove
Approaching Candidate References
Reference checks that merely verify employment aren’t usually useful. But if a reference seems willing to go beyond rote answers, you may get valuable information, especially concerning hunches. Here are some things to that Lencioni says to keep in mind when you approach candidate references in this part of the hiring plan:
- Put people at ease by assuring them that their answers won’t be your determining factor. References tend to be overly positive or cautious when they feel their answers will make or break a candidate. Describe your company culture and stress that you’re just trying to determine whether the candidate would be a good fit—and whether both she and the company would benefit from the hire.
- Seek specifics: Besides the typical approach of asking for adjectives describing the candidate, ask for examples of specific behaviors, or how the candidate acted in certain situations. Adapt some of your interview questions and see how the reference’s responses compare with the candidate’s.
- Focus on qualities you have doubts about or are unsure of. Again, try to get specific examples of behavior.
- Ask what others would say about the candidate’s humility, hunger, and people skills. Ask the same questions you asked the candidate for comparison purposes. This gives references a chance to offer valuable information without being the one to personally bring up something negative about the candidate.
- Note when references don’t respond. Most people who have something positive to say don’t hesitate to do so; a failure to respond may indicate a problem (although this isn’t always the case).
TITLE: The Ideal Team Player
AUTHOR: Patrick M. Lencioni
Selection: Evaluate and Hire Candidates
After you’ve interviewed candidates, how do you decide who to hire? The Making of a Manager suggests you take these steps to evaluate and select candidates:
Step #1: Review work they’ve done in the past. Evaluate a few projects they’ve completed that are similar to the work they’ll be expected to do at your company. According to Zhuo, this will give you a clear sense of their skills and ability to problem solve. It’ll also help you forecast how they’ll perform in the future.
Reviewing job candidates’ past work is a common screening technique among employers. What should you look for as you review those projects? In addition to ensuring the projects are relevant to the position they’re applying for, as Zhuo recommends, business leaders advise that you consider whether the candidates’ work reflects the style of your business. For example, if their projects are mostly formal, corporate content and your business are more lighthearted and fun, candidates might have a hard time adapting. Also, make sure the projects are varied, which suggests candidates are versatile.
Step #2: Ask trusted peers for input. Zhuo says you likely won’t get useful input from references a candidate furnishes. Instead, seek input from colleagues and peers in your professional network who’ll give you an honest assessment of candidates.
Although Zhuo doesn’t suggest specific questions to use when getting input from colleagues, be sure you’re clear about what information you need. In Execution, Larry Bossidy and Ram Charan recommend asking not only about what someone has accomplished but also about how they did it and the skills they used. Pose questions such as “How would you describe their communication style?”, “How did they support or undermine teamwork and collaboration?”, and “Do they adapt well to shifting priorities, or do they tend to resist change?” The answers to such questions will inform you about a candidate’s strengths and weaknesses, as well as how well they’re likely to fit your company’s culture.
Step #3: Go with candidates who excite you. Even if a candidate has the needed skills and qualities, don’t choose them just because they could fit. Zhuo says to always give preference to candidates who spark enthusiasm in at least one interviewer. Candidates are more likely to add high value to your team when they stand out as unique.
Rather than passively waiting to see if candidates make a notable impression on you or your fellow interviewers, as Zhuo suggests, you can design your interviews to give candidates opportunities to excite you. For example, ask candidates questions such as “What part of your work makes you excited to get up in the morning?” “How would you describe the difference your work makes?” Candidates who deliver personalized, impassioned responses will quickly stand out from those who deliver “canned” answers.
Step #4: Prioritize diverse candidates. Hire candidates who have varied work and life experiences and who represent diverse races, genders, cultural backgrounds, and sexual orientations. Zhuo says diverse teams generate more creative ideas, solve problems more effectively, and produce superior outcomes.
To secure the advantages of a diverse workforce, as Zhuo recommends, you must clearly communicate the value you place on diversity to attract a more diverse talent pool. For example, vocalize your commitment to diversity during job interviews, or require candidates to write a one-page solution to a problem that involves a diversity challenge at work. Requiring them to solve a problem like this highlights the importance you place on resolving diversity challenges and creating a safe environment for all employees. It also allows you to gauge whether candidates are likely to respond to diversity challenges in a way that meshes with your company culture.
Step #5: Choose people who have the potential to contribute beyond their designated role. Prepare for future growth by hiring candidates who are equipped to deliver more than you need immediately. For example, even if a frontline sales role doesn’t include supervisory responsibilities now, Zhuo says it’s wise to give an edge to candidates who have relevant sales experience and supervising experience. They’ll be able to step into bigger roles as your team grows.
Hiring the Right Kind of Ambition
After conducting interviews, the next step of your hiring plan requires selecting your candidate(s). One of the traits you should look for in a candidate is ambition, says Ben Horowitz in his book The Hard Things About Hard Things.
Ambition comes in two flavors. The wrong kind of ambition emphasizes a person’s personal success regardless of the company’s success. The right kind of ambition emphasizes the company’s success, with the person’s success coming only as a consequence.
Hiring people with the wrong kind of ambition pollutes the company. These people are demotivating to work for—why work endless hours just to further the manager’s personal career? In contrast, working alongside people with the right kind of ambition is invigorating—everyone is working toward a mission that is larger than themselves.
You can screen for ambition in the interview process. People with the wrong kind of ambition do these things:
- They use “I” when talking about successes, and “we” when talking about failures. When you probe further into successes, they often know little about the actual details.
- They care about their personal compensation above details on how the company will win.
- They talk about their career work in terms of personal stepping stones, such as “this was my consumer play” or “I wanted to build out my resume.”
People with the right kind of ambition do the opposite:
- They use “we” when talking about successes and “I” when talking about mistakes/failures. They know minute details about how successes were achieved. They blame themselves for team mistakes.
- They ask first about how the company plans to win. Their personal compensation comes second.
Pros and Cons of Hiring Overqualified Candidates
Although Zhuo highlights one significant benefit to hiring a candidate whose qualifications exceed job requirements, she doesn’t elaborate on the many other advantages—or, the many drawbacks—of this approach. Here are some key pros and cons based on experts’ insights:
- Increased productivity—When people have extensive experience above and beyond their current role, their advanced skill set can help increase your company’s performance levels.
- Reduced training time and costs—Overqualified candidates are usually equipped with the knowledge required for performing their basic job duties, which requires you to expend fewer resources training them.
- Valuable input and ideas—Candidates who have worked in more advanced roles are often able to identify ways to improve efficiency.
- Risk of underperformance—When someone feels overqualified for a position, they may become complacent and bored if you don’t challenge them or nurture their ongoing development.
- Alienating other employees—Other team members may perceive this hire as reducing their opportunities for advancement.
- Higher risk of turnover—If an overqualified candidate takes a position out of desperation or mere curiosity, they may leave as soon as another opportunity comes along that better fits their skill level.
Hiring an overqualified candidate may indeed be the best option for your company, as Zhuo suggests—but, be sure to weigh your company’s needs against the associated risks.
Horowitz also says that when you’re working in a startup company, you may prefer to promote people from within.
So why hire senior executives at all? To move faster. They know how to do things that your company doesn’t know right now, and bringing in outside knowledge will help your team learn faster and grow more quickly.
- For example, if you’re a product and engineering-focused team, no one on the team may know how to build a dominant sales force. While you can experiment and learn internally, an incoming VP of sales can accelerate the strategy far faster.
For any senior executive, consider how much of their job requires inside knowledge vs. outside knowledge. This will influence whether you should promote from within or hire from outside.
- An engineering manager needs to understand your proprietary codebase, and this is more important and difficult than learning how to run an engineering team. It’s likely better to promote this person from within.
- An enterprise sales manager needs to understand how to build a sales process and a sales team, how to run both with discipline, and how to target the right people in the target buyer. With this framework, they can sell virtually any product. It’s likely better to hire this person from outside.
Onboarding: Train New Employees
Now you’ve selected your new employee(s). But the work isn’t over yet, and there’s another step in your hiring plan. New employees need training to “test out” their role within their company during the onboarding phase. Horowitz gives advice for two types of onboarding training: functional training and management training. He also gives tips on how to onboard senior executives who might bring problems with them.
In general, functional training should do the following:
- Make clear the expectations of the job and how the worker will be evaluated.
- Introduce the worker to the materials and systems she’ll be working with. (For example, a software engineer will need an introduction to the product, code base, and coding practices.)
- Draw from the best functional experts on the team. Make training an honorable and respected job in the company, rather than grunt work.
Beyond these generalities, functional training should be customized to the job that needs to be done.
- While leading a product management team at Netscape, Horowitz discovered that everyone had a different understanding of what the product manager role was. He wrote a document called “Good Product Manager/Bad Product Manager” that made expectations clear. For example, good product managers figure out what customers want; bad product managers focus on matching competitive features and focus on how to implement them.
Functional training should be a mandatory component of all teams in the company. You can enforce this by denying their requests for more people until you validate their training program. Likewise, for new employees, training should also be mandatory before they can start doing work.
Management training prepares managers to lead their teams. It should do the following:
- Make clear what tasks managers should be doing, such as one-on-one meetings, performance feedback, training, and goal setting. You should be the person teaching this course and setting these expectations.
- Train managers on how to accomplish these tasks (for example, how to run a one-on-one meeting).
- Enlist the best managers to teach the courses.
Onboarding Senior Executives
Senior executives bring a wealth of knowledge and experience with them, but they can also bring problems. Here are common issues and how to deal with them:
- Culture clash: Execs are used to working and communicating a certain way, shaped by cultures as previous companies. You shouldn’t compromise your company’s culture for this person. Enforce your values and workflow.
- Politics: Execs, especially those who come from big companies, may be used to playing politics. Watch out for these actions and don’t tolerate them.
- Lack of accountability: If you can’t do the exec’s job, then you don’t know what good performance looks like, and you’re likely to be impressed with even mediocre work. Set a high bar for incoming execs—talk to domain experts and figure out what world-class performance looks like, then set the bar at this level.
- Insufficient performance: An executive might have really impressed in the interview process but turns out to be suboptimal in performance. As CEO, you don’t have the time to personally do employee development for your executive team. Executives need to be performing at 99% right away; any executive you need to spend time developing is limiting your leverage and distracts from running the overall company. (This applies only to you and your executives; the rest of the company should still develop team members and refine raw talent.)
TITLE: The Hard Thing About Hard Things
AUTHOR: Ben Horowitz
After following all of these steps, you should’ve found the perfect person (or people) who fits your team. Whenever you need a new addition to your team, you can always refer back to this hiring plan or adjust it to your needs.
If you have any advice for creating a hiring plan to bring on new employees, leave your tips in the comments below!
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