June 7, 2017
Who should my first hire be? Scaling your small business.
Has your business been running on the “leanest” model where you as the owner wear every hat imaginable?
Assuming you’ve been growing the business, you may soon (if not already) reach a point where it’s time to expand your team beyond the one-man-band status. There is only so much one person can cope with and still maintain any kind of life outside of work, while at the same time, you can only grow to a certain point managing on your own.
For some business owners, hiring is an easy decision to make, but others find it harder to let go, particularly at the thought of someone else taking charge of things for your “baby.”
Of course, hiring staff brings you new legal and tax obligations you didn’t have before too, so it’s not a decision to be made lightly. Let’s take a look at the signs that suggest you’re ready to hire and who that first hire might be.
SIGNS YOU’RE READY TO HIRE
You’ve got to have some key indicators, rather than just a feeling it’s time to hire. After all, given the cost of hiring employees, it needs to make financial sense for your business. The following are signs which will have an impact, either directly, or indirectly on the financial success of your business:
TURNING AWAY WORK
A good sign that you have enough work available to justify hiring someone else is that you’re turning down work which you’d otherwise like to take on. This doesn’t hold true for everyone – some people have their own reasons why they’d prefer to keep their business small, but it’s at least an indicator there is work available for a new hire.
A lot of growing business owners face the same limitation, which is the total number of hours in a day. Those who don’t let hours inhibit their growth are those who realize scaling is about wise use of other resources, rather than being tied to time.
Still feeling reluctant? In a piece on The Muse about hiring your first employee, Nathaniel Koloc points out that many overworked founders end up kicking themselves for not hiring earlier. It’s usually later on they realize how much they weren’t getting done while they delayed hiring.
On the other hand, Brian Casel raises a valid point when he says “being busy is not a reason to hire someone.” You have to be busy with the right kinds of tasks. He found with his very first hire that he was spending a lot of his time devising work for her to do – what he needed was tasks that contribute to the business overall and are highly repeatable. So, anything you do often and can document a procedure for is a good task to be giving a new hire.
If you’re spread too thin across too many tasks, it doesn’t usually take long for things to fall through the cracks. When those things impact customers, you’re likely to see complaints come in, especially if work quality or timeliness is affected.
It’s tough to succeed in the business world, so the last thing you need is to have poor reports of your performance circulating. If this sounds like you, it’s a definite sign you need to do one of two things:
- Scale back your work.
- Hire someone to help you with it!
REVENUE IS CONSISTENT
Taking on an employee is obviously an added expense and you don’t want to be in the situation where you’re scraping to make payroll. If you’re in the position where revenue is consistently reliable, then you may be ready to hire someone.
YOU’VE IDENTIFIED NEW OPPORTUNITIES
It’s often the way with any business that you start out producing a certain product or service, but discover others that would fit with what you do along the way. If you’re already working close to capacity, you may not have room to execute those ideas without extra help.
If you’ve found a new revenue opportunity and already know that people are willing to pay you for it (the best way to know this is to actually have someone pay you for it!), then it’s probably time to look for your first hire.
WHAT JOB ROLE DO YOU NEED?
Of course, there isn’t a “one size fits all” answer to who that crucial first hire should be, but there are some traits to look for in the person, as well as characteristics of your business to create the right environment for hiring.
Let’s take a look:
YOU’VE IDENTIFIED WHERE YOU NEED HELP
It may seem obvious but go back to Brian Casel’s comment in the first section. You don’t want to be eating into your own productive time while you come up with tasks for a new hire to do. You also don’t want to be handing them “busy work” for the sake of getting something done.
Besides standardizing and documenting tasks, Brian suggests listing all of your first employee’s tasks before hiring them. When he owned and operated Restaurant Engine, he used Trello to set out tasks for each employee. “To do” was for tasks being worked on or in the pipeline, “Repeating” was a list of their weekly tasks and “Ongoing” was for tasks they could move to when they had completed the rest. This is good for ensuring the founder isn’t spending a lot of time each day answering “what should I do now?”
You don’t have to wait until you’ve already hired.
Brian uses these boards for planning too:
“I actually create this board in Trello months before I hire the employee. During that time, I slowly fill it up with tasks that I’d eventually plan to delegate to this person, once they’re hired. At first, it only contains one or two tasks. But once those lists start to grow, it’s time to start looking for someone.
This isn’t just for hiring your first employee. I do it for every position I plan to hire for.”
YOU HAVE A CLEAR VISION FOR YOUR BUSINESS
What is the point of all those tasks? You need to have an end-goal in mind for the direction of the business if you’re going to make the best use of any new hire.
Having a clear vision which you’re able to communicate is also helpful in making your hiring decision. You want people on your team who buy into your vision and are excited by the idea of helping you make it happen.
FIND PEOPLE WHO ARE BETTER THAN YOU
You know what you need to be covered and you have a strong vision for the future of your company, that means it’s time to find the first person who will help bring that vision to life.
If they already fit with your vision for the business, then what you really need is someone who will add to your business by being better than you at the tasks you need to give them.
You don’t want to be hand-holding or babysitting, especially as your time is better spent on the tasks you’re good at which will grow your business. You also don’t want to be tempted to micromanage tasks and waste more time.
You should be confident in the abilities of the person you hire and know that they can get tasks done with little input from you.
If you’ve ever worked within a large company, you will have found that there seems to be every type of person there, including those who can get away with staying in their shell and simply be plodding away at work all day.
Not so for most small businesses. These first few hires can be crucial to the future success of your business so you need strong communicators who are willing to speak up rather than simply hide in their corner. Look out for;
- Listening and asking the right questions.
- Strong written and verbal communication.
- Initiative (or a track record of it).
This is not saying “only extroverts need to apply.” You don’t necessarily need the most outgoing people available, but you do need those who communicate well.
ALWAYS DO BACKGROUND CHECKS
“Realize that criminal, under-qualified, and emotionally unstable minds hide in all uniforms and job titles.” Yikes Entrepreneur, thanks for that! They do make a valid point though; you shouldn’t make a hiring decision based on your gut instinct or even simply on the qualifications the employee states they have.
It’s often said that past behavior is a good predictor of future behavior, so don’t be lax in checking for references and any other background checks which are necessary for your line of work. Many an employer has previously been bitten in the behind by going with a gut feeling rather than completing appropriate checks.
It can take a long time to remove the “wrong” employee, or even mitigate the effects of having them in your business, so always take care with your pre-hire investigations.
Hiring your first employee can be a big deal, especially if you’ve been used to going solo. You might be feeling overworked or stressed, but we suggest that you take care and set aside time to plan your hiring carefully.
You need to know what you’re wanting to achieve within your business and how a hire can help you get there. You also need to have specific tasks or a job description for what they’ll be doing. You don’t want to be giving them “busy work” or taking a whole lot of time out of your day to devise tasks for them to do.
Your new hire should align with the vision you have for your business, be a strong communicator, and have good references in their background check. Set a good foundation and process for employee one that you’ll use to then build out the rest of your team!