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Making The Right Personnel Choices

"It's not that I'm so smart, it's just that I stay with problems longer."

Albert Einstein

One important problem facing many small business owners is the task of creating the right staff. The potential success or failure of a company is directly related to the quality of the employees working for that organization. In order to encourage growth and financial rewards, managers need to acquire certain tools to recruit and maintain a productive staff. The future may be uncertain unless an employer learns how to put all the pieces of the puzzle together.

Most people think that hard work is always rewarded. Yet many business owners work much harder than their competitors, only to end up making less money every year. Why? Because those business owners have weaknesses on their staff. While the owner struggles to increase business, unproductive employees are holding that company back from going to the next level. The only way to stop this from happening is to hire the right people in the first place.

An unproductive employee can effect a company in ways not immediately visible to the employer. If a potential customer has a negative experience with an employee, that customer will always have a bad feeling about the company. Even if the employee ends up being terminated, the potential client is lost forever. According to the Employee Selection and Development Inc. in Bradenton, FL, the average hiring mistake costs a company approximately $7,000 to $10,000. Competitive pressures make hiring right the first time a necessity.

The U.S. Bureau of Labor Statistics reports that the expansion of the nation's labor supply has increased by only 1.1 percent per year since 1996. This pace is expected to continue through 2006. In the tightest labor market in 40 years, business owners must compete fiercely to recruit, hire, and retain the most desirable workers.


In order to recruit the best qualified and most committed personnel, an employer needs to develop a systematic approach to the recruitment process. By creating a plan, employers can utilize the professional expertise found in the growing field of human resources. Advantage Information Services in Florida recommends a six-step recruiting plan.

The Top Six Tips For Recruiting

1. Know what you expect. Take a critical look at the demands of the position you need to fill. Commit to paper a thorough job description, including all your expectations. When you clearly understand the education, skills, learning speed and personality traits the job requires, you'll be ready to locate an employee who will satisfy your needs.

2. Cast a wide net. There are currently more resources than ever for finding potential candidates. Advertising and networking are still the two best methods for letting people know about your job openings. But businesses should also build a network of contacts who can quickly refer qualified job seekers.

Expand the reach of traditional newspaper advertisements or association contacts by using the Internet as a recruiting tool. According to BusinessWeek Online, the number of job search sites has exploded this year. As of May, 1999, there are more than 5,000 job search sites on the Internet, not including employers' own web sites.

If you have your own web site, add an "Employment" page with an online application. If you don't have a web page, it's probably time to add one. Internet Fund's Ryan Jacobs predicts the Internet will be incorporated into all businesses within the next three years. The rapid growth of Internet use means job seekers (and consumers) will increasingly rely on web-based first impressions.

3. Aim for good job fit. If you've ever had a job you didn't want to do, even if it's just a simple chore, like washing windows, you understand the concept of job fit. Sure, you may learn to achieve spotless windows, but would you be willing to do the job day after day for the duration of a career?

Personality characteristics and learning speed can indicate how well an applicant will fit the position, and can be objectively measured with fairly simple assessments. When pre-employment tests are part of the application process, they may help eliminate unsuitable applicants before the expensive and time consuming interview stage. For example, pre-employment tests or surveys can tell an employer whether the applicant has a preference for working alone rather than interacting with customers, or whether the applicant will perform well under pressure, or if the applicant is likely to take shortcuts on the job.

"Job-related testing and assessments are essentially the only way to document objective and non-discriminatory hiring practices," says Chuck Russell in his book, Right Person, Right Job. "The selection process is vital to profitability. It is the most economical point to exit marginal performers."

4. Know what's considered fair. Fair hiring rests on two basic rules. First, employers must measure all applicants by the same standard. Second, employers must make certain that all standards are job-related.

By the time you reach the interview stage, you should have narrowed the field to two or three qualified candidates. In order to meet fair hiring standards, your interviews must be free of discriminatory questions. Do not ask questions related to race, age, sex, ethnic background, national origin, religion, or disability. Every question you ask must have a direct relationship to job skills or job requirements. Even innocent, rapport-building questions can be construed as discriminatory.

Give the candidate a good description of the work he or she wouldbe expected to do. Again, make sure your expectations are job related, and not influenced by any bias for or against an individual. Let every candidate know, for example, if weekend or evening work will be required, or if heavy lifting is part of the job. You may safely ask, "Do you know of any reason that you would be unable to fulfill the requirements of the job?" This gives the candidate a chance to let you know if religious beliefs or physical disabilities would prevent satisfactory job performance.

5. Protect yourself from liability. Background screening may be the best investment an employer can make, advises the Society of Human Resource Management. "It's vital that organizations conduct thorough background checks that are legal, effective and consistent," explains Michael Losey, president and CEO of SHRM.

The 1999 SHRM Reference Checking Survey reveals that 53 percent of human resource professionals regularly or sometimes discover falsified information on job applications. To prevent fraud in the workplace, Personnel Journal recommends a thorough barrage of pre-employment screens, including a criminal background check, credit history, drug test, personal and professional reference checks, lien searches in the county courthouse where the applicant resides, psychological tests and previous employment checks.

Far more lawsuits are filed every year for negligent hiring than for discrimination in hiring. If a job requires an employee to handle cash, to drive a vehicle on your behalf, to work unsupervised on a customer's premise, or to have certain licenses or certifications, you must perform appropriate background verifications.

6. Prepare your employees to succeed. Prepare in advance a thorough new-hire orientation. Be sure to include the complete job description and employer expectations. Give the employee measurable objectives, so that both of you can agree on the parameters of satisfactory performance. Establish a reasonable training period within which you expect your employee to reach a certain level of productivity. Set checkpoints during the training period that will give you the chance to assess performance, praise good work, and redirect undesirable behavior.


Once an employer has developed a good approach to the recruitment process, the next step is to start conducting employment interviews. The interview process is the first thing that takes place between a candidate and a potential employer.

According to Michael Gravelle of The McQuaig Institute in Toronto, Canada, as the U.S. job market becomes tighter and talent more difficult to find, positions are left vacant for longer periods of time forcing managers to spend a greater amount of time interviewing people. Additionally, with today's mobile workforce, job dissatisfaction that is often associated with high turnover is less likely to be tolerated by the remaining staff. The problem has a domino effect.

Yet despite changes in the availability of talent and the need for companies to find and retain talent, the people doing the actual hiring keep on making the same mistakes when interviewing candidates. Gravelle says that there are a series of interviewing mistakes most commonly made by employers. These mistakes usually result from incorrect assumptions. Instead of relying on factual information, the interviewer uses their own biases to form their conclusions.

For example, a Landscape Contractor named Tom was interviewing candidates for a field assistant position. He liked the squeaky-clean, fresh-out-of-college look of the first applicant, Andy. When Andy mentioned that he played hockey in a league, Tom assumed this meant that he was a team player and had the competitive desire he needed to win in business. The second applicant, Bill, had a buzzed haircut which was a sure sign of a bad attitude as far as Tom was concerned. When Bill said he played hockey in a league, Tom figured this meant he was a hooligan, and he would probably come in late for work because he'd be out drinking with his buddies after his evening matches.

These assumptions were not based on past behavior or fact. Instead, Tom's assumptions were based on his own stereotypes. Mistakes made by employers are due largely to false assumptions rather than using a systematic approach.

The Ten Most Common Interview Mistakes

1) Making up your mind within minutes of meeting the candidate.

Research has shown that interviewers make up their minds within four minutes of shaking a candidate's hand. They spend the rest of the interview interpreting what the candidate says in a way that is congruent with their first impression. For example, they are more likely to brush off the negatives on a favored candidate's history as just a bit of bad luck, while viewing skeptically the accomplishments of a less favored candidate. To interview more effectively, managers must recognize their personal biases and objectively measure candidates on their past performance.

2) The Halo Effect. Letting one factor (e.g. honor's student, worked for your top competitor) influence everything else. Not everyone who was a great student has excelled in the business world, and your top competitor has probably hired their fair share of incompetent workers. Where a candidate worked is never as important as what they did when they were there.

3) Asking predictable, opinion-based questions. Questions like "what are your strengths and weaknesses", "where do you hope to be in five years?" provide very little insight about what really motivates individuals. What you find out instead is how well the person has prepared for the question and has crafted a response that you want to hear. If you insist on asking these questions, try following up by asking for concrete examples that would indicate how their strengths and weaknesses have worked for or against them in the past. Or try asking what they have done in the last five years that would indicate that their five-year plan is realistic.

4) Not probing vigorously and accepting unsupported or vague claims instead of probing for details. For example, a candidate says "I doubled my territory's productivity within the first year." Does this mean sales went from one million to two million or twenty thousand to forty thousand? Get all the facts. Find out exactly what they did to attain their achievements, and most importantly, ask for the name of the person they were reporting to during that time. You'll find your candidate's success stories will suddenly start sounding more realistic.

5) Being unprepared. By not reading the candidate's resume until they are in the reception area, or worse, in your office, you are sending a negative message: I don't care about you; this is not a people-oriented company; I'm not going to be paying too much attention to your responses to my questions. The candidate returns the favor by providing vague responses, lying, and mentally registering your company as a place to work only if nothing better comes along. By not reviewing the resume, you are missing a great opportunity to impress the candidate with your knowledge of their past, build rapport, get candid responses to your questions and probe their work history.

6) Placing too much emphasis on the can-do (things like educational and technical credentials); instead of the will-do (things like attitudes, motivations, temperament).Will-do factors have been shown time and time again to be the traits that lead to success or failure in a job, yet managers rely on a combination of can-do factors and gut feelings to make decisions. Remember, what they did is never as important as how they did it.

7) Answering questions for the candidate. For example, "Our competitor runs his business like boot camp. How did you like working for them?" If you could keep your own opinions out of the question, you'll get more candid and meaningful responses from candidates.

8) Not carefully determining the job requirements. Employers often make assumptions about job requirements and hire based on those assumptions, only to find out that the assumptions work against successfully filling the position. For example, companies may limit their candidate pool by specifying a college degree, when what they really need is someone with good communication skills and professional demeanor.

9) Over-selling the position. When an employer interviews a candidate who seems very promising, the employer tends to present the job in a way that the candidate will find most appealing. For example, if interviewing an energetic, assertive person for an administrative assistant position, an employer may emphasize, even embellish the autonomy and opportunities for advancement that the position provides, when what the job really requires is someone to type memos all day long. What that employer ends up with is an employee who, in addition to being deeply dissatisfied with the job, feels they have been lied to. They won't last long.

10) Relying solely on the interview. There are an abundance of affordable, easy-to-use assessment tools available for all companies to utilize. Personality tests and ability assessments help to define a candidates capability in an objective way.

By avoiding these ten mistakes, an employer increases the chances of hiring the best candidate for the job.


Once you've developed a systematic approach to both the recruitment and hiring process, the next step is to provide your employees with a comprehensive benefits package. Although many companies vary the benefits offered to employees, there is a basic concensus of appropriate benefits provided by research from the United States Department of Labor.

In 1996, the Bureau of Labor Statistics, U.S. Department of Labor conducted the Employee Benefits Survey which covered 39.8 million full-time and 14.1 million part-time employees in private establishments with fewer than 100 workers. The survey consisted of information regarding benefits such as paid leave, health coverage, and retirement benefits.

Paid Leave

Paid time off was the most frequently provided benefit for full-time employees in small private establishments in 1996. Four-fifths of full-time employees received paid vacations and holidays. One-half received paid sick leave, and more than one-fourth received another form of short-term disability protection (for example, sickness and accident insurance) in addition to, or in lieu of, paid sick leave. Three-fifths received paid leave for jury duty, one-half received paid funeral leave, and one-fifth were eligible for military leave.

On average, vacations varied substantially by length of service. For example, employees received about 8 days after completing one year of service, but almost 16 days after 25 years. To a lesser degree, paid sick leave also reflected length of service. The average days of sick leave were 8 days after one year of service and about 11 days after 25 years. On average, small private employers granted 7.6 paid holidays.

Health Benefits

About 2 out of 3 full-time employees (64 percent) participated in employer-sponsored medical benefit plans. More often than not, employees had to contribute to the cost of their medical benefits, and those benefits were contained in a managed care health plan. Fifty-two percent of participants were required to contribute towards the cost of single coverage an average of $43 and seventy-five percent of participants had to contribute for family coverage an average of $182.

Nontraditional, or "managed care," plans continue to make enrollment gains among participants in employer-sponsored medical plans. Twenty-seven percent of all full-time employees participated in health maintenance organization plans (HMOs. Thirty-six percent participated in preferred provider health plans (PPOs), in which participants are provided medical services at a higher level of reimbursement if they receive care from a network of service providers rather than choose their own providers. Twenty-six percent of full-time employees participated in traditional fee-for-service plans.

Participants in plans other than HMOs (traditional fee-for-service and PPO plans) have a greater choice of service providers, but bear a substantive share of the costs of services directly. Annual deductibles, the amount the participant pays each year before the plan reimburses any covered expenses, averaged $306 for individuals and $744 for families.

Employer costs for the health plans of all employees in small private establishments averaged 74 cents an hour worked. Health plans include dental and vision care plans, in addition to medical plans. These employer costs are estimated in the BLS Employer Costs for Employee Compensation program.

Retirement Benefits

Forty-six percent of full-time employees participated in one or more employer-sponsored retirement plans. Fifteen percent of all full-time workers were enrolled in defined benefit plans and 38 percent were enrolled in defined contribution plans. Some participants were enrolled in both forms of retirement plans.

In plans with specified employer matching rates, 49 percent of participants had an employer match on their contributions of up to 5 percent of earnings. Another 38 percent of participants were in plans with matches on more than 5 percent and up to 6 percent of earnings, and the small remainder were in plans with matches more than 6 percent of earnings. The most common rate of employer match (applicable to 36 percent of participants) was 50 cents for each dollar contributed by the employee. Thirty-one percent of participants were in plans with lower match rates, and 33 percent participated in plans with higher (such as a 100-percent match).

The required minimum length of service for a normal retirement benefit varied by the age of retirement. For example, it was common to require up to 30 years service before age 62, 5 or 10 years at age 62, and no service requirement or 5 years at age 65 and older. Voluntary early retirement, with a reduced benefit, was available for about 9 out of 10 participants. Early retirees can avoid the normal minimum age and service requirements by taking a reduced benefit.

Employer costs for the retirement benefits of all employees in small private establishments averaged 34 cents an hour worked. These costs were divided rather evenly between defined benefit and defined contribution plans at 16 and 18 cents an hour.

Other Survey Findings

Thirty-four percent of participants in life insurance plans had their insurance protection defined as a multiple of their earnings; for virtually all of the remainder, the insurance protection was a stated amount in dollars (usually thousands). On average, insurance for full-time employees amounted to 1.4 times earnings if a multiple of earnings and just over $16,000 if a stated amount.

Two other benefits were fairly common to full-time employees in small private establishments; nonproduction bonus plans and plans providing assistance for job-related educational expenses covered about 2 out of 5 employees.

Part-time employees were less likely to be covered by most benefit programs. The most common benefits could be prorated to time worked - for example, paid leave. Thirty percent of part-time employees received a paid vacation; 24 percent received paid holidays. Part-time employees had a far smaller chance of participating in benefits that had substantial per capita costs - for example, health insurance; only 6 percent of part-time employees participated in their employer-sponsored medical plans.


With a systematic recruitment, hiring, and retention process in place, the employer can focus on the final piece of the puzzle: In order to create the right have to be the right boss. So much of an employers time is spent evaluating the quality of their employees. But how many times have you honestly accessed your own skills as a manager or business owner? In order to be surrounded by great employees, you need to be a great boss. If you can make your employees believe in you and your company, they will try harder and care more about their work. In order to keep people committed to your company, you need to be worthy enough for their commitment.

According to Improving Workplace Performance Through Coaching from American Media Publishing in DesMoines, Iowa, to effectively deal with employees, a manager or business owner should learn about coaching. Coaching is an ongoing process designed to help an employee gain greater competence and overcome barriers to improving performance. Coaching is appropriate when an employee has the ability and knowledge to succeed but performance is not at the level needed. The goal of coaching is to create a change in behavior, to move employees from where they are to where you want them to be.

There are two different types of coaching: spontaneous, on-the-spot coaching and planned, formal coaching. Both can be effective if done properly; however, many attempts at on-the-job coaching fail because of the manager's natural tendency to take over. For example, a contractor who accompanies a field worker on a job may have to intervene to "fix" the job if he sees the work is going badly. Instead, the contractor could should coach the worker first and then allow the worker to deal with the situation. Another manager may believe he is coaching when he pushes an employee away from the computer and says, "Here, let me show you," and then finishes the job.

These interventions are not coaching-they demonstrate a lack of confidence in the employee and undermine any further coaching efforts. The employee never learns to develop the skills that may improve future performance. Good coaching, whether planned or spontaneous, focuses on developing the employee, not making the manger look good.

Coaching differs from training, which is a structured process that provides employees with the knowledge and skills to perform job tasks. The situations where a worker needs additional training instead of coaching include changes in work procedures, equipment, or tools. Also, a worker needs further training when there is a change in their job responsibilities. The employee should be fully trained on any new aspects or expectations of their position.

Coaching also differs from counseling, which is directed at personal issues that are effecting (or have the potential to effect) performance. A worker needs counseling, as opposed to coaching, when they are chronically tardy and absent or have emotional outbursts. Other situations where counseling is needed include erratic behavior or a substance abuse problem. An employer should never become a personal counselor to their employee. Instead, the employer can serve as a resource person in directing the employee to an appropriate professional practitioner or organization.

Situations where an employee needs coaching from their boss include when a worker shows a noticeable increase in errors or they start missing deadlines. Coaching is needed when the employee's performance does not match their ability to do the job.

An effective boss is someone who can recognize what an employee needs when they are displaying certain performance indicators. If you find that an employee is having trouble meeting the job requirements even after receiving the appropriate coaching, the best thing to do is to talk with the worker. Schedule a meeting with the employee and describe your concerns. Ask the employee why he or she is not meeting your job expectations. Try to stay quiet and actively listen so the employee can express themselves clearly. You might be surprised by what you learn. Often, employees realize that a problem exists but don't know what to do about it, and they are relieved to have a chance to explain their side of things. The opportunity to work with you to solve the problem will in itself help strengthen the employee's motivation.

As you speak with the employee, you may find that he or she might be motivated to achieve in other circumstances but is not currently in the right job. Perhaps the person is most comfortable working independently but must now work with a team, or perhaps you're asking a team-oriented person to work alone. Maybe the employee feels unchallenged by the position. At that point, you must make a personnel decision by either promoting or reassigning the employee.

Effectiveness at work requires both leaders and followers. In order for a business to function appropriately, all the pieces of the puzzle need to fit. A leader needs to develop the most effective way of assembling a productive and talented staff. The followers need to commit to performing at their most conscientious and highest level. When the two sides come together in unity with the same purpose as their goal, there's no stopping that company. Not only will the business flourish, but the employees will feel loyalty and commitment to their employer. And the employer can feel pride in a job well done.























































































































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February 17, 2020, 2:11 pm PDT

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