The Golden Investment – Hiring!

This week I was invited to lunch by a small business owner who wanted some help developing his interviewing skills. He will be making one of the most important investments a small business owner makes – hiring.

Let me explain why I say this. It’s not because of the cost of staffing. It’s because when hiring is done correctly, you not only add staff, you make an investment in the business, an investment in the business, and more importantly, you are putting your business culture at risk. A good hire will more likely result in a growing business, and happy employee, and the ability to sustain or create the culture you want for your business. A bad hire puts all of those same things at risk.

There are many great books written on hiring. Many more on performance management after you hire someone – and even more on developing great employees. My goal here is share some very simple things a hiring manager can do to find then select good people.

Finding people

  • Referrals – of the last large group of small business owners I’ve worked with, their best recruiting source is often the same as the best source for their sales funnel – referrals from their own customer base.  

Try this: Email blasts that both says “thank you” to existing customers for their business and also says “because of your patronage my business is expanding and I’m now hiring for a _____. If you or someone you know is interested, please have them email/call …..”

  • Promoting current employees – the proactive business owner hires people not for the open position, but for their next position in the business. Hiring people with aspirations and higher goals is a great way to sustain a productive culture, but it takes a commitment to coach and mentor the employee to their goals as well.

Try this: Outline what you want your business Org Chart to look like in 1, 3, and/or 5 years. Then look at your current team and see who you want to fit into what future position. This should help you identify talent gaps and/or coaching gaps to fill or address.

Interviewing

  • Behavior based questions – there are internet resources for thousands of BBI (Behavior Based Interview) questions that are designed for the applicant to relate a “real life” situations in the interview rather than “pie in the sky” questions.
  • Consistency – for any one position the interviewer will target 3-5 key competencies that the best candidate will need to succeed. Ask every candidate the same BBI questions, though follow up questions will vary based on the answers. Rate each candidate’s responses on some scale (1-3, 1-10, whatever works for you) for each competency – then you have a snapshot that helps you OBJECTIVELY identify the best candidate. (And may help you with any potential legal issue for hiring practices.)
  • Interview follow up – have the interviewed candidate send you a follow up letter or email, summarizing their key take a ways from the interview. Check those letters/emails for comprehension, grammar, spelling, and overall professionalism. Factor this into your competencies.
  • Second interviews with peers – allow key staff people to do a mini-interview for the most qualified candidates to get their input (team building) and assess how the candidate fits into the culture from their perspective.
  • Personality profiles – there are many internet based personality profiles available for most every industry that helps make the hiring decision more objective. Look into one that you can try. Start with your own assessment, then with existing (and successful) staff. If it works on them, it should work on candidate.

Then comes the real work – on boarding the new employee, coaching, performance management, career development, etc – but those topics are for another day!

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The Big E’s: Effort, Energy, and Enthusiasm

While the systems that run your small business are critical to your success and the staffing and personnel are essential to any sustained success, there will still be new and unique challenges that will try slow your productivity, or even threaten your livelihood. All the systems in the world may not be able to overcome the onslaught of wrenches that will find their way into even the most well-oiled of small business machines.

This is when it all falls back on the small business owner. How the business owner fuels the business is through a series of characteristics that define the viability of the enterprise. The effort, energy, and enthusiasm that you bring into your business will ultimately determine the potential for the long term success of your business. Wow, talk about some pressure!

While having effort is important, you can’t sustain the effort without sufficient energy.

And energy is great too, but without the enthusiasm it will often be short lived and without any followers supporting you.

And enthusiasm is awesome too, but without effort, it becomes an empty smile, without energy it becomes just another project that will fade in a short amount of time.

The three E’s stand side by side with the best entrepreneurs – arming themselves, their business, and their teams against every foe – internal and external.

Effort is the foundation, providing the backbone and setting the standard for the business. Effort is reflected in the core values of the business, the guiding principles, and setting the tone for every employee is the business.

Energy sustains the effort. Being present in the business and being the coach to the rising stars in the business. Energy becomes contagious and defines the culture for the business.

Enthusiasm ties it all together. The enthusiastic leader inspires enthusiasm! Natural enthusiasm inspires motived employees, creates a supportive environment, and makes the “job” more of a “vocation” for the long term.

The Big E's

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My Hammer Doesn’t Make Me a Carperter

This week I found myself needing to use a different car for a while. Like anything “new” to me, I usually have to fumble and bumble my way around the details – radio buttons, cruise control, mirrors, etc… It takes me a good 30 minutes of frustration before I get flustered enough to open the glove box and read the manual…

The frustrating systems in the car – from the XM channel listing to the Bluetooth to the cruise control – all became quote simple once I looked in the right place. Turns out everything in the car is designed to be simple – regardless of the haphazard approach I was taking to figure it all out.

All the “bells and whistles” in the world don’t add value to us until we know how to use them effectively. The car had some amazing features, and even the common features were still pretty cool on this new car.

I was reminded that we are surrounded by systems that make our lives so much easier and satisfying – from air conditioning, appliances, plumbing, electricity, and many, many more. The beauty of a functional system is that it just happens – no real thought or invention required. We purchase, install, and get out of the way, until it breaks and then we apply the repair or replacement process.

This should be true for the “systems” in your small business. The more functional systems are in place, the more the processes will run without distraction and without having people reinventing wheels. These systems include service systems, marketing systems, retention systems, staffing systems, performance management systems, and more.

A key point here is that the air conditioning unit is NOT the system; it’s a tool in the AC system. Just like post cards are not marketing systems, but rather a tool in a marketing system. Until you build a system around your tools, you simply have a bunch of tools but nothing to apply them with. I can have 20 hammers, but that doesn’t make me a carpenter.

Build systems around your tools, and those systems should include:

  • Process owner – who is accountable for the system, reporting is progress, success, and return on investment
  • Documented process – who does what, when, how often
  • Expectations on bottom line – what will this system produce and how do we measure that production

Systems drive efficiency – and efficiency drives profitability…

How effective are your systems? Can you list all the systems in your business? How does that compare with what your revenue goals are? How can you improve your systems today?

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When “Great Service” Provides a False Sense of Service

Many small business owners describe their customer service as “great” or “very good” without much hesitation. I would suggest however that there are tremendous opportunities left on the table because there are too many “order taking” service transactions rather than those where opportunities are proactively identified.

When we take a service issue from a customer and resolve that issue, have we provided “great” customer service? If we say “yes” I would say you are missing out on what could be the biggest differentiator between you and your best competitors.

Order Takers these people solve the issue before them. End of story. Customer is left feeling like they have be helped, and that is the end of the interaction. This is the basic level of existence in a small business – I was called, I took the orders, I provided what they wanted as best I could.

Solution Providers  these folks not only solve the immediate problem, but they also apply the solution to their “system” and share the issue so it is either less likely to reoccur or, if it does reoccur, the shared solution will expedite resolution.

Opportunists  these people take the service issue and then go to the next level with a pivot maneuver to cross selling or up selling or some other retention technique and “value add” element. The Opportunists sees the big picture with the customer interaction, and solves a problem while also seeing the opportunity to create a deeper relationship.

The transition between these types of people is most often simply a pivot statement, something like:

“I’m so sorry you had this issue and I am confident I will get it resolved for you…  But I’m so glad you called because we were going to be calling you soon anyway! I noticed that your account didn’t have _____ and we have a special _______ for it right now. I know you are busy but I will work it up and have someone give you a call about it ________ .”

Or

“I’m so sorry you had to deal with that, but I am glad I got to speak with you. We make customer service a top priority here. If you are happy with my service in taking care of your issue, I would love to offer the same service to anyone you know that needs _______. Can I ask you for a friend or family referral that would also appreciate the service we provide?”

The critical element of the transition will be your expectation that every service interaction MUST be perceived as a potential sales interaction. Creating the expectation that X number of leads must be generated per business day from service transactions lays the foundation for transforming your customer service.

Building a team of Opportunists rather than Order Takers will transform not only your service level but also your sales funnel!

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Yes, Your Elevator Pitch Matters

I met with an attorney recently who runs a small firm in Texas. It was a casual meeting of cycling enthusiasts but we eventually talked about his business, just kicking around some ideas about systems and such… And he’s built a nice business that is growing and making him money – both very good places to be for any business owner!

He shared with me his personal strengths and weaknesses in terms of how he is managing his business. One of his ‘pride points’ was how he ‘simplified’ his response to the question “what do you do?” from family, prospects, and the general public. He often found himself stumbling around that question so he simply created a brief explanation that he had printed on the back of his business card – so he simply responded to that question by handing out his card.

Having moved from the insurance business to the software business then back, I understand the challenge of delivering an interesting and informative “elevator pitch” that gives someone a 15 second “what can this guy do for me” solution, or worse – “what is he going to sell me?”

The two of us agreed that a better, more thought out response to the “what do you do?” question might help him open more doors and generate more immediate interest in his firm.

How do you overcome the trap of the elevator pitch – meaning how to you set yourself up as a person of value? How do you overcome both the potential “I’m asking but not listening” and the “he’s giving me a sales pitch?” reactions that most people will most likely put forth?

Matt Oechsli hit the nail on the head with his blog post “Don’t Sell Yourself Short” when he said that you have a rare opportunity to make a value statement with your elevator pitch… And then leveraging that opportunity by combining good body language and a concise statement…

His litmus test for the elevator pitch? Can your spouse and/or support staff explain and articulate your elevator pitch with ease? When they can, you can say your mission statement has the potential to be of value to you, and those you meet.

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Lessons Learned From A Great Small Business Owner

This past week the world lost a great man. A patriot, father, husband, Christian, and a small business owner. He was many things to many people, but he was so much to so many because of what he was able to do through his small business.

I met Bob a few years ago when I, a first time “sales manager” who knew everything that needed to be known about a small business (not). I went to meet Bob and learn how I could help him – and left there already a better sales manager just for spending an hour in his office.

In reflecting on my relationship with Bob while making my way to his memorial service, I could not help but recall how my few interactions with him taught me more about being a successful business owner than hours of reading or classroom experience.

I thought I pay homage to Bob with a few of the highlights of how he impacted me and how I mentor and coach other small business owner/operators.

1. Never pass up a learning opportunity.

Bob attended every class he was offered, always finding a way to prioritize continued self development, both formal (from the class facilitator) and from his peers (positive interactions with his fellow business people). Bob worked hard to have systems in his Agency and among his staff that allowed him to be away from the office to focus on development.

2. Respect your employees.

Despite sales cycles and economic factors and so many other influences, Bob never had a problem with staff turnover. He worked hard on building and developing a staff of quality and committed people that all rowed the boat in the direction he was piloting (and I hope the Air Force flyboy forgives a nautical reference!).

3. Keep your chin up, despite (insert every complaint here).

Bob faced personal, professional, and environmental challenges with only a positive attitude. While his peers would find reasons to NOT engage the challenges but rather hide behind them and throw out excuses, Bob would face the issues with a happy heart, knowing his priorities were his faith, his family, his country, and his business. No excuse in the world would supersede his goals. He owned his results and, because of that, he solved issues every day that held his peers back.

Thank you Bob for being a positive influence in my development and for being the man you were to so many that needed you. Rest in peace.

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Applying Segmentation to Boost Sales

Strengths based segmentation works every time.

Had a great conversation with a small business owner this week who has seen his top sales rep have a 50% increase in gross revenue this month.

My first question was “Wow, what happened?”

“It worked!” He said, with an ear to ear smile.

By “it” I learned he meant segmentation. He finally started applying techniques he’s been talking about for months – aligning strengths with duties, letting his best sales people spend more time selling, and letting non-sales people do more non-sales activities.

Having the resources to delegate service work to non sales staff is essential. There are certainly sales opportunities in so e service work, and there needs to be accountability on the service staff to identify those and quickly hand those off to sales staff OR sell it themselves.

So why did it take months to implement the segmentation? It’s easier to talk about change than implement change.

But all it takes is a spark…

That moment when status quo is no longer good enough. When complacency is recognized as the enemy of growth…

When you reconnect with the hopes and dreams you had when you started your business…

When you can objectively align the strengths and weaknesses of your team and your systems to streamline the income opportunities every minute every day.

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