Building a Hiring Process to Fill Openings with Great Candidates
By Alex Yohn
May 2, 2016
This is the third piece in our multi-part series on smart hiring. This article takes a look at how all companies, regardless of size, can turn the best practices we’ve discussed so far into a robust pipeline of talented candidates. That way, when an opening emerges you aren’t scrambling to fill the role.
Any company founders who have experience in sales or marketing will recognize the model for a smart-hiring process: a funnel. It’s wide at the top, it’s narrow at the bottom, and it qualifies candidates as they graduate from one stage to the next.
And really, it makes sense to think in sales and marketing terms. You’re prospecting candidates, qualifying leads and nurturing relationships. You don’t wait to go after customers, and you shouldn’t wait to go after the people who are going to help grow your company.
Be Proactive, Not Reactive, in Your Search
Perhaps the biggest flaw in reactive hiring — i.e., waiting until you have an immediate need before you start searching for candidates — is that it forces you to target only people who are actively looking for a job. This is a small percentage of all available candidates.
According to research put together by recruiters Armstrong Appointments, only 12% of the workforce is actively looking for a new job at any moment. Meanwhile, only 15% of people are content to stay right where they are. That leaves a yawning gap of 73% of the workforce, nearly 3 in 4 people, who are open to having a conversation about switching jobs.
A smart recruitment strategy budgets time and energy to vetting these potential candidates, as well. “Waiting until the moment a position opens up to start searching for talent to fill it ensures that employers and hiring managers will always be playing catch-up,” ClearCompany cofounder and CEO Andre Lavoie writes at Entrepreneur.
“Instead, employers should have an ongoing pipeline of qualified candidates in their back pockets. Ideally, when a position becomes available, employers should have at least one person in mind who qualifies — especially for companies that often hire for very specific jobs.”
The question, then, is how can a company — especially a smaller company — build such a pipeline of talent?
By shifting the paradigm a little. Instead of acquiring talent, you need to be marketing your company to talented people.
Create a Funnel to Market Yourself as an Employer
Chris Brablc, director of marketing at recruitment marketing platform SmashFly, argues that potential candidates have begun to behave like consumers: They expect quality content and personal messages from companies, and they research potential employers with real diligence.
“Candidates are wholeheartedly embracing their alter ego ― the consumer ― when they look for their next career opportunity,” he writes at TalentCulture. “Talent acquisition organizations need to adjust by not just being recruiters, but by also being recruitment marketers.”
The good news is many companies already have an inbound marketing funnel they can essentially copy/paste to begin targeting these candidates. The goals of a talent funnel are different than the goals of a marketing funnel, but the basic idea is the same.
Siofra Platt at Social Talent has an excellent post in which she shows how to apply a funnel model to finding and eventually contacting candidates, particularly those so-called passive candidates who comprise the majority of the workforce. Here is her five-stage funnel, starting with the top:
Need recognition
Information search
Evaluation of alternatives
Purchase decision
Post-purchase behavior
Translating this to hiring is pretty straightforward. “Need recognition” means a candidate — passive or active — realizes she could benefit from taking a new job, and “purchase” means her accepting a job offer. “Post-purchase” would roughly translate to onboarding.
Platt then goes on to describe how recruiters (or whoever is in charge of hiring) can make contact with a prospective candidate, which we will cover in a moment. The next step, however, is creating a pool of candidates at the top of your funnel, and that starts with prospecting.
How to Fill the Top of Your Talent Funnel
“Prospecting” is the right word, too. Just as a solid business development team identifies clients who would be a good fit, a solid recruiter needs to find ways of identifying candidates who would be a good fit.
“As you set out to build your funnel, write out the characteristics of the employees you hope to attract to your team and try to reverse-engineer things that would be attractive to these people,” VENTUREAPP cofounder and CEO Chase Gabarino writes at the BostInno blog.
There are several ways to approach this process:
First, if you already know what roles you will be hiring for in the near term, you can begin to put together a list of skills and qualifications necessary for each specific role.
Next, Kathleen de Lara at Entelo recommends coming up with “must-have” and “nice-to-have” candidate traits. “You’ll find more candidates who are close enough to perfect, than candidates who hit every single mark,” she writes. “Learning how to work around the candidates you find, which can be viewed as the typical result to expect from that search, teaches teams how to evaluate using variable baselines, and how to adjust their onboarding strategies to grow candidates within their role.”
Finally, draw directly from sales and marketing again and come up with candidate personas. Employer marketer Allison Kruse has a great guide at LinkedIn for creating these kinds of personas.
One more paradigm shift might be helpful in this need-recognition state of your funnel. Recruiter Darren DeLuca argues against the idea of someone being a “passive candidate,” a term mentioned earlier. Instead, he writes a company must think in terms of “those who are aware of us and those who are not.”
That’s what the top of this funnel is all about. Someone who might already have a pretty satisfying job can be alerted to the idea that better options exist, and your company could be one of those better options.
It’s a matter of communicating that.
How to Engage and Nurture Your Talent Pool
Here is where we need to loop back on Platt’s advice at Social Talent. Once you have identified a list of prospects, you need to reach out via email to trigger that need recognition. This initial email doesn’t have to be long, but it does need to be personal. Platt recommends keeping the email no longer than three sentences:
A good hook to set you apart from other companies and recruiters
A to-the-point sentence that lets the prospect know what’s in it for them
A specific call-to-action (Platt’s example: “Can you take a call at 6:30pm this evening to discuss further?”)
That’s all you need at this point because all you are doing here is starting a conversation. “You need to remember that your initial email alone will NOT convince a candidate to apply for your job, but a good email WILL start them on the road to seriously considering the job and putting their hat in the ring to apply,” Platt writes. In other words, this email will trigger qualified prospects to move into the research phase, the second stage of the funnel.
At that stage, you can begin to simply add value to the relationship. This can, and should, take some time. “The name of the game here is a long lead nurturing cycle,” Catherine Hess from GreenJobInterview writes at Business2Community. “If you pluck them before they’re ready, you may risk burning the lead. So take your time as you get to know these candidates and usher them into your passive talent funnel.”
Depending on company size, need and your team’s own capacity, you can scale this process to whatever size necessary, whether that’s two candidates on deck or 20. Dr. John Sullivan, a professor of management at San Francisco State University, has three tips to keep in mind as you scale:
Always be identifying prospects and reaching out.
Try to predict any future vacancies.
Make sure to build all of these candidate relationships on trust.
Putting It All Together
J.T. O’Donnell, founder and CEO of CAREEREALISM, has an excellent example of this approach to hiring in action in a post she wrote for LinkedIn. In the piece, she spoke with Yahoo recruiter Rachel Saunders, who described the end-to-end process a team member used to recruit a software developer they were interested in.
It’s worth quoting Saunders at length here — and capping off this series with the story — because her’s is a textbook example of smart hiring:
“One of our recruiters is a self-proclaimed tech nerd who follows a lot of blogs that discuss cutting-edge projects being worked on at various companies. He saw [the developer] was involved in a technology we were using and reached out to her to learn more about her projects and to hear what she thought of the technology. While she wasn’t considering leaving her current role, the recruiter stayed in touch with her by email for two months, exchanging articles and insights.
“Eventually, he invited her to come to our campus and tour our facilities to see what we were working on. She agreed. Several months later, she called him and said it was time for her to find a new role because she wanted to work on projects she cared about and had recalled the ones she saw during the tour. She was hired shortly after. It’s that kind of nurturing that helps us find and hire the top talent with the best superpowers.”
This is the second piece in a multi-part series on smart hiring. This article will explore just how expensive bad hires can be for a business, plus two things you can do when recruiting to avoid making such mistakes.
It’s expensive to hire the wrong person for a job. This is the other side of the coin when it comes to smart hiring practices: Doing it the right way adds tremendous value to your company, and doing it the wrong way subtracts tremendous value.
The Cost of Bad Hires
Let’s try to put numbers to this. First, you have the expenses associated with listing a job, screening and interviewing candidates, and onboarding someone. Fast Company’s Lydia Dishman, citing research from Glassdoor and consultancy the Brandon Hall Group, estimates this is about $750 for entry-level hires to nearly $3,800 for executive-level hires.
But Dishman points out that these figures don’t take into account harder-to-quantify consequences such as lost productivity, poor team performance and effects on company culture. Here, we can really only estimate the costs per company and per hire:
In the first piece in this series, we mentioned that Zappos offers new hires $2,000 to leave after their initial training if they think they’re bad fits. So, Zappos must calculate the cost of their bad hires as more than $2,000.
Executives Online calculates that a bad executive hire costs 3.5 times the person’s annual salary, assuming the person stays in the role for the full year.
Maynard Webb, Chairman of the Board at Yahoo!, cites the book Who by Geoff Smart and Randy Street, who say the average hiring mistake “costs 15 times an employee’s base salary in hard costs and productivity loss.”
You should probably take that 15x figure with a grain of salt, especially for smaller companies, but it’s a useful way to illustrate what kind of a money pit bad hiring can be. To understand why, you need to understand how costly employee disengagement can be.
What Makes Someone a Bad Hire?
Stanford researcher Emma Seppälä and University of Michigan researcher Kim Cameron write at HBR that positive work cultures tend to be the most productive, and as we discussed last time, the best hires are good fits for your company culture. Therefore, bad hires tend to be bad fits culturally, and they can disengage very quickly.
“And disengagement is costly,” Seppälä and Cameron say. “In studies by the Queens School of Business and by the Gallup Organization, disengaged workers had 37% higher absenteeism, 49% more accidents, and 60% more errors and defects. In organizations with low employee engagement scores, they experienced 18% lower productivity, 16% lower profitability, 37% lower job growth, and 65% lower share price over time.”
When productivity dips, many organizations try to fix the problem with Band-Aids, so to speak: Employee perks, work-from-home policies, gym memberships. These are all nice things to have, but they don’t fix the really fundamental issue. “A Gallup poll showed that, even when workplaces offered benefits such as flextime and work-from-home opportunities, engagement predicted well-being above and beyond anything else,” the researchers say. “Employees prefer workplace wellbeing to material benefits. Well-being comes from one place, and one place only — a positive culture.”
This is where so many companies go wrong. By failing to build a strong culture, communicate that culture clearly and hire for cultural fit, they’re perpetually stuck bringing on employees who cannibalize more value than they create.
If your company already has a defined culture, though, you’re in luck. There are two pretty easy-to-implement stop gaps in the recruiting process that will screen out potential bad hires. (And if you don’t, go back and read our post on core values.)
Measure a Candidate’s Cultural Fit Objectively
Many companies large and small pay careful attention to their cultures, but they sometimes fail to grasp what, exactly, it means to hire for culture. “Cultural fit still remains quite ill-defined as an assessment criterion,” HR veteran Kazim Ladimeji writes at Recruiter. “Many employers simply define cultural fit in an off-the-cuff, I-know-it-when-I-see-it manner.”
Ladimeji points to a couple of studies — one from UK personnel assessment company Cubiks and one from the American Sociological Association — that found less than a third of organizations actually used any measurable dimensions to determine cultural fit. But, in reading the ASA study, “it became clear that cultural fit was a key factor in determining whether a person would be hired. What also became clear was that cultural fit was not related to organizational values. Rather, managers were hiring people based on whether or not they would enjoy socializing with them.”
Scrubbing that go-with-your-gut attitude toward hiring requires intentional effort on two fronts.
First, you need to unambiguously communicate what your company’s culture is upfront, before you even begin screening candidates.
“When a company is completely honest about their values, mission and vision, they are unintentionally making their application pool smaller because not every person is attracted to the same kind of work environment,” Mark Agostinelli at staffing agency The Davis Companies writes. “This is advantageous in finding and retaining engaged and excited employees who will thrive in their working culture.”
Then, you need to be measured in what information you take away from candidates during the interview stage. Katie Bouton, founder and president of Koya Leadership Partners, has a couple of helpful tips in a post at HBR:
Ask candidates directly about what cultures they thrive in. Ask what best practices they bring from former employers, and what time they’ve felt they were in positions where they were bad cultural fits. “You can assess the candidates’ work ethic and style by honing in on the following: whether they succeed in a virtual environment or with everyone in the same space; if they’re more comfortable with a hierarchical organization or can they thrive with a flat structure; and if they tend to collaborate across teams or operate in a more siloed approach,” Bouton writes.
Bring the candidate in your company’s world. Give the candidate a tour, introduce the candidate to members of the team, or go for a group lunch. You’ll be able to gauge the person’s level of comfort pretty quickly, and involving other colleagues will open up opportunities for outside feedback.
And if you are approaching the hiring process proactively, that means you are not necessarily looking to fill a vacancy ASAP. Use that flexibility to put together a roster of potential hires, and, as the team at Huxley Banking & Financial Services recommends, hire those candidates for one-off projects before committing to a full-time role.
Verify a Candidate’s Past Performance
It’s easy to yadda yadda over reference checks when a candidate aces interviews and gets nods from would-be coworkers, but scrutiny is most needed during the post-interview phase. This might be your last chance to uncover an issue before you start training and paying the candidate.
“Past performance is the best predictor of future performance,” writes Suzanne Kelly, founder of HR consultancy Acquisition Intelligence. “Therefore, this is the time where the investment of due diligence will be the best preventative measure in scrutinizing and validating hiring decisions.”
Perhaps the most important thing you can do at this stage is to check all of the candidate’s references to learn more about the candidate’s drive, heart and character. “The people that have worked with them can give you the clearest picture of these qualities, if you ask the right questions,” JetBlue Airways Chairman Joel Peterson says.
And there is a science to this.
Claudio Fernández-Aráoz, a senior adviser at executive search firm Egon Zehnder, has a bookmark-worthy piece at HBR on how he consistently places candidates whom companies never have to fire:
Have the candidate put together a long list of references. You can narrow down the list yourself. Says Fernández-Aráoz: “Former bosses are great at assessing strategic orientation and achievement drive; peers can help to measure influence; subordinates are often the best judges of leadership.”
Ask each reference specific questions about the candidate. Do this over the phone, he recommends, so you can hear any emotion or hesitation, and be very clear about what the role you’re hiring for is, and whether the reference has seen the candidate perform well in similar situations before.
Ask each reference about the candidate’s social and emotional intelligence. Ask about the candidate’s self-awareness, her ability to maintain self-control, her motivations, and her level of empathy.
Describe your company’s culture to the reference, and ask whether the candidate’s own values align with that description. “In addition to the essential acid test of integrity, you should determine whether the candidate’s views on things like time orientation, a farming versus hunting sales approach, and the balance between collaboration and competition match yours and those of future colleagues and teammates,” Fernández-Aráoz says.
Ask each reference whether the candidate continues to grow and learn. Curiosity, insight, engagement, and determination: Fernández-Aráoz calls these the “hallmarks of potential.”
This is the first in a multi-part series on smart hiring. This article takes a look at some best practices to help companies find and retain the kind of people whose talents and drive will help build a stronger organization.
It’s not at all easy to find, hire and hang onto great employees. But these are the people who help you build your dream, so it’s an important process to get right. Here are four tips for creating a smarter hiring process.
1. Learn to Hire Proactively
It’s easy for companies — especially smaller companies — to fall into a habit of hiring reactively, only when a need arises for someone to fill a specific role. This approach to hiring has a couple of big downsides.
First, reactive hiring puts tight time constraints on your hiring process. What are the odds that the right candidate is looking for a job at the same time you’re looking to fill a position?
In fact, Lou Adler, veteran headhunter and author of the book Hire With Your Head, argues at Inc. that you shouldn’t assume a surplus of talent exists at any time. “Most companies have hiring processes based on weeding out the weak rather than attracting the best,” he writes. “Designing your hiring processes around the assumption that there’s a scarcity of top people is the first step in hiring more top people.”
Second, reactive hiring can then force companies to settle for a new hire who might not be a true fit in terms of skills, experience or personality.
Proactive hiring, on the other hand, gives your company more time to identify and recruit the very best people (we will explore how to identify these people in a moment). When you give yourself time to thoroughly vet candidates, you put yourself in a position not to simply fill a role but to bring onboard valuable, talented people who can help your company achieve its goals.
“Hire in the direction you want to go with the business,” David Neagle writes at HR.com. “Your business should have a direction, and your new hires need to be merging with that path.”
Neagle recommends hiring at least six months before you plan to grow the company. He continues: “Hiring in the direction of your company’s future means that you’re not only avoiding layoffs or firings in the future, but it also signals that you’re doing what you can to make your business run more smoothly.”
Proactive Hiring Sounds Time-Consuming, But On Balance It Isn’t
Employee-retention specialist Roy Barker frames proactive hiring as a process in which a company markets for talent and builds relationships with potential hires over time. Doing this gives your company the flexibility to really gauge a person’s qualifications, attitude and cultural fit.
It also puts you in a position to have ready-to-hire candidates on deck for whenever a specific and immediate need arrives. Barker recommends having one or two such candidates at all times.
This approach to hiring talented people requires an upfront time commitment, but this is not time you necessarily would be losing. “When I suggest that hiring managers and recruiters be more proactive … they immediately tell me how they don’t have enough time,” Barker says. “Really? Because you do seem to have enough time to dig through hundreds if not thousands of applications, interview 10 individuals who are not good fits for your company, and even hire for the same position three or four times in as many years.”
2. Incorporate Personality Assessments into Candidate Screening
A candidate’s experience and past performance are important to explore during the hiring process, but they don’t tell the whole story. Companies should hire for culture fit, and personality assessments are great tools for getting a more holistic understanding of how potential employees fit into the cultural fabric of a company.
The team at Gild, which helps enterprise-level clients recruit and hire, notes that many companies and recruiters already test applicants, but typically only for cognitive skills. “Certain roles require teamwork, and that’s not something that can easily be measured through cognitive tests,” they write.
“Personality assessments, on the other hand, will give you a better idea of a candidate’s social skills. For example, a more upbeat person may have be better at handling clients, while quieter people may need to be placed in behind-the-scenes roles.”
Chad Harrington at recruitment platform Relode — itself an advocate of using personality tests when hiring — suggests hiring managers take a look at these options for assessing a candidate’s personality:
Personality Tests Even Work for Executive-Level Hires
Personality tests might carry greater weight when vetting candidates for an executive position because those roles often come with such visibility.
Lucy Leske at Witt/Kiefer, an executive search and staffing company in the Chicago area, spoke with Kellie Woodhouse at Inside Higher Ed back in August about why her company vets university presidents with personality tests.
“The skills and competencies that they’re required to bring to the table have to be so well developed to handle today’s jobs,” Leske said. “All boards are concerned about risk when hiring a chief executive and this is an additional way to assess the risk in an environment where the landscape is changing so rapidly that you’ve got to rely on competencies now, not just experience.”
Tomas Chamorro-Premuzic, CEO of Hogan Assessments, which has helped companies assess candidates’ personal qualities since 1980, lays out four personality traits companies should look for when hiring for leadership positions:
Emotional stability helps leaders stay cool under pressure so they can calm down their subordinates and keep everyone on track when things get tough.
Ambition helps leaders set challenging goals their teams need to reach for. That’s especially important considering the reciprocal effects between engagement and performance. In other words, engaged employees perform better, but high-performing individuals will also be more engaged. It’s either a virtuous circle or a vicious cycle depending on how well a leader leads.
Sociability helps leaders communicate with their teams, develop good networks, and put in the time it takes to nurture those relationships.
Interpersonal sensitivity causes leaders to focus more on others than on themselves. They’re more altruistic and better attuned to their subordinates’ feelings.
3. Put Job Objectives in Your Listing
When listing an open position, frame it as a series of objectives rather than a role that requires a specific skillset or experience. Again, this comes straight from the Lou Adler playbook, which says to remove the “Skills” and “Experience” sections from any job ad.
His argument: Thinking in terms of skills and experience unnecessarily filters out potentially great hires because you are holding these candidates to an arbitrary standard. You don’t hire people to demonstrate skills; you hire people to achieve very specific objectives. So put those objectives right in the listing.
Adler tells a story on his blog about being hired as an executive recruiter years ago to find a VP of Marketing for an industrial products company. In his presentation, he crumpled up the paper the HR team prepared about the job description and asked a simple question: “What does the person in the VP Marketing role need to accomplish in the first 6-12 months in order for everyone in this room to agree you’ve hired an outstanding person?” From within that frame, the team was able to come up with six performance objectives, and the company hired an all-star VP within six weeks.
Further, objectives-based hiring puts your new hire in a position to succeed because you can turn those performance objectives into measurable job objectives once the person is hired.
4. Find New Hires a Mentor to Help With Onboarding
A smart recruiting process doesn’t end the moment a good candidate is hired. There is still the matter of onboarding a new hire, which requires more than just a day of orientation and a few explanatory emails. The best onboarding processes pair new hires with mentors who help them get acclimated over the course of their first six, maybe nine months.
This is a big obligation for the employer. Finding the right mentor is the key to delivering on-the-job training and facilitating in-house knowledge transfer, WorkForce Software’s Direction of Communications Jonathan Corke writes. “Companies must take the lead — through scheduling — to ensure that the two parties work side by side, facilitating the knowledge transfer that will transform those new hires into productive, long-term employees.
Naomi Thalenberg at employee-retention platform TINYpulse has a few tips for identifying good mentors for your new hires:
A mentor should not be the person’s manager or boss.
A mentor should be a trustworthy team member who can help answer questions a new hire might not feel comfortable bringing up during the first days or weeks at work.
A mentor should have an exemplary work ethic and knowledge of the company’s culture, history, workflow and expectations.
A mentor should be able to smooth over particular social details such as where people go for lunch or happy hour drinks.
Getting Serious About Onboarding
From the new hire’s perspective, a comprehensive onboarding process is about more than just getting acclimated to a new company; it shows your company cares about this person’s success and want him or her to fit in with your company’s culture. Zappos has even put a dollar amount on the value of that fit. After that company’s month-long employe orientation, it offers new hires $2,000 to quit if they feel they’re not a good fit.
So, here are a few onboarding best practices, courtesy of the Society For Human Resource Management, to implement alongside a months-long mentorship program to get your new hires comfortable and set up for success:
Write out your onboarding plan, and ensure it is implemented consistently each time.
Monitor the program, and use milestones at 30 days, 60 days, 90 days and 120 days to check on a new employee’s progress.
Be transparent in communicating to new employees their objectives, your expectations of their timeliness, and their roles and responsibilities.
An interview with the team at Wodifyby Lindsay Sanders
Our first customer spotlight of 2016 shines on the fit and innovative team at Wodify. Similar to Kin, they created their CrossFit workout management software out of a seeming void of existing solutions. They’re expanding their software and team this year, and are excited for what the future holds. Read on to learn more about the team and how they’ve used Kin to improve their onboarding process.
Who are you, what’s your role, and your favorite hand-held food?
[NF] My name is Nicole Fasolino and I’m the VP of Operations at Wodify. My favorite hand-held food? PIZZA!
What’s the story of Wodify?
[NF] Wodify was founded in 2012 after the founder and CEO, Ameet Shah, fell in love with CrossFit. Tired of watching his performance get erased from the whiteboard at the gym each day and frustrated with the tedious process of keeping a workout journal, he began searching for digital performance tracking tools. Unhappy with the other performance tracking apps on the market, he set out to create Wodify.
Wodify is an all-in-one tool for athletes and gym owners. Boxes that adopt Wodify replace their traditional whiteboard with a digital whiteboard kiosk where athletes can view their WOD (“workout of the day”), check in to class, and input performance results into the Coachboard. The web and mobile platform allows coaches to configure WOD’s in advance, view athlete progress and attendance over time, see athlete percentage charts (all percentages of 1-rep max for a back squat, for instance) and automate processes like billing and class scheduling. Athletes too can track their results with performance graphs, log their diet, and like and comment on each other’s performances.
Our offices are located just outside of Philadelphia in Cherry Hill, New Jersey. Wodify started with just 3 employees and has grown to 30 employees. We are currently in 3000 CrossFit gyms in over 70 countries and continue to grow at a rate of 7 to 10 gyms per day!
What’s great about working at Wodify?
[NF] Perks! We’re all about them! We have an onsite barber and nail technician to make sure our team is well taken care of. And being in the fitness industry, it would only make sense that we have a gym right below our office. Employees are free to workout when they want and we even offer a lunchtime class for people who want to get their sweat on during lunch.
Above and beyond all of the perks, we’re a group of people who not only enjoy working in each other’s company, but also enjoy spending time with each other outside of the office. It’s not uncommon to kick off our Friday early, grilling burgers and drinking beers from our 6 tap kegerator.
Please share some insight into Wodify’s approach to employee and workplace operations. How has Kin played a role?
[NF] We’re a software company so, obviously, we use a great deal of cloud software solutions to keep us productive from anywhere. One process we were looking to bring online was our onboarding process. Like many businesses, we started with pen and paper checklists and as our onboarding needs grew, we started looking for a tool that allowed us to manage the process online. Kin has allowed us to do just that and has helped us improve our onboarding process.
Using Kin, we create tasks for several employees in the company who help with onboarding new hires, including account creation, ordering hardware, sharing company handbooks, completing paperwork, and getting acquainted with our software tools. It can be easy to lose track of which tasks and paperwork have been completed and what’s still outstanding, but with Kin, we eliminate all of that.
“Kin’s onboarding feature also gives new employees a seamless experience so when they come in for their first day they know exactly what to expect and are ready to go with all paperwork completed.”
Anything notable going on lately?
[NF] Things are always moving quickly here at Wodify and we’re excited about what 2016 holds for us! We’re in the middle of completely redesigning our app to be fully responsive on mobile so gyms can manage their business from anywhere. We’re also redesigning the athlete and kiosk experience in the gym.
We’re also planning to take the social experience to the next level for Wodify athletes and to expand on what we’ve learned in the CrossFit industry to branch out into other fitness verticals. Wodify is always looking to the future and sometimes that even means experimenting with wearable and iBeacon technologies in the gym. Always looking for new talent to join our team too!
By Alex Yohn
Feb 29, 2016
By all appearances, the company you’ve founded can’t possibly survive without you, right?
This is one of the biggest challenges founders of small companies face. After years of identifying your company’s values, creating a culture and implementing scalable systems, your company should be able to carry on without you.
But most people struggle to recognize when the moment to let go arrives.
A Question of Leadership and Legacy
Gina Folk, a contributor at Entrepreneur, argues that being able to step aside is essential to leadership — and it’s something that separates leaders from bosses. “Bosses may feel they are delegators, but because they don’t trust anyone else to do the job as well as they can, they never fully delegate anything,” she writes. “Leaders truly delegate. They assign tasks, and then let go (though they still follow up periodically to ensure their team members are on track to achieve the desired results).”
Folk’s definition applies both at the day-to-day operations level, and when it comes time for a founders to design themselves out of their companies. Fundamentally, both of these leadership traits come down to a question of trust. Do you trust the people you’ve hired to run your business?
If not, you might be playing leader more than you are actually leading. “If a project is heading into a ditch, by all means, step in,” advises Tara Jaye Frank, VP of Multicultural Strategy for Hallmark Cards. “Otherwise, clarify your goals and expectations, then trust people to get the job done. Don’t insert yourself just because you can, or because you feel the need to appear in control.”
If you are in the habit of doing what Frank advises, it will be easier to ultimately hand over your company to the team you’ve built. The trick is to recognize when that time has arrived, and being mentally prepared for it. Below are three signs — which typically overlap to some degree — that this time has arrived.
When a Great Leader Emerges
Authors Gary Keller and Jay Papasan tell a story at TheOneThing.com about Sophia Amoruso, who built an online retail empire with her company, Nasty Gal. Amoruso guided her business from its start as an eBay retailer in 2006 through to eight-figure sales just seven years later, which earned Amoruso a spot on Entrepreneur’s Women to Watch list in 2013.
Amoruso eventually hired retail veteran Sheree Waterson to be the company’s CEO, and a rougher-than-expected 2014 showed Amoruso that the company she’d built from scratch would need Waterson’s leadership to continue growing.
Here is how Amoruso explained her decision to step aside and embrace her role as brand ambassador on the Nasty Gal blog:
“My entire youth has been Nasty Gal. My entire future is Nasty Gal. This is a choice that will give our team, and our business, legs. And it will give me the freedom to feel that I’m using my talents at my best and highest. And for Sheree, this will unleash her incredible talent and leadership across an organization that has never been so ready.”
Richard Feloni at Business Insider covered Nasty Gal’s transition in January 2015, and he spoke to Duke University’s Sim Sitkin, a professor at the Fuqua School of Business, who pointed out to Feloni that young entrepreneurs often need to bring on an experienced CEO to handle a business that grows faster than the founder can learn the game.
“Duke’s Sitkin says when there is a transition in senior-level management at a company, it is crucial for the founder to ‘recognize what their real continuing contribution is, what their real continuing contribution is not, to let go of the things they need to let go of, and to do so gracefully,'” Feloni wrote.
When Your Passion Now Belongs to Someone Else
Founding, running and leading a company takes a lot out of anyone. To be successful, a founder must shoulder tremendous pressure and make difficult personal sacrifices. At some point, whether in five years or 25 years, the initial passion that led to the company’s founding will not be enough to push through that stress and those sacrifices.
But because of a sense of duty or identity as Company X’s Founder, you might be standing in the way of someone who does have that necessary passion.
Sabrina Baker, CEO at Acacia HR Solutions, tells a story of one mentor she had who had expended that initial passion, but she ended up staying too long in her leadership role out of obligation.
“She was a respected leader who was very close with her team,” Baker writes. “She didn’t want to leave them in a lurch and knew her departure would create more work for them. Some leaders know they should leave but don’t because they feel obligated to those they work with.”
Part of a legacy, she says, is formed by the person’s knowing when to bow out gracefully.
When Your Company Grows Beyond Your Reach
As with Amoruso’s experience at Nasty Gal, sometimes a company can outgrow its founder. This might be the hardest reality for a founder to accept, and there aren’t too many prescriptive tips to help you recognize when your company has outgrown you.
Sometimes, as John Brandon writes at Inc., a founder is only good at leading smaller teams: “Someone might be good at leading a small team through the early startup days and then realize, as the company grows, that he or she just can’t lead a large organization. It’s a totally different skill set. Leading a small team is all about the relationships, the ideas, and the conviction to a cause. Leading a large team is more about strategy and vision, and can often become more of a financial leadership role.”
Other times, founders design company-wide bottlenecks around themselves. This seemed to be the case at 4chan, as Megan Geuss at Ars Technica reported in January 2015 when founder Chris Poole stepped down.
Here is Poole’s own statement:
“4chan has faced numerous challenges over the years, including how to continuously satisfy a community of millions, and ensure the site has the human, technical, and financial resources to continue operating. But the biggest hurdle it’s had to overcome is myself. As 4chan’s sole administrator, decision maker, and keeper of most of its institutional knowledge, I’ve come to represent an uncomfortably large single point of failure.”
Each founder and each company is different, and recognizing whether your company has outgrown you relies on your own honest self-assessments.
How to Hand Your Company Over to Your Team
Sattar Bawany, CEO of Singapore’s Centre for Executive Education, writes at HR.com that his country’s long-serving prime minister, Lee Kuan Yew, understood early on that handing his office over to a successor would be crucial.
Lee served Singapore for 31 years and oversaw its transition to an independent country in 1965, but as Bawany says, “The heart of Lee’s leadership legacy is succession planning.”
He continues: “The saying goes; there is no success without a successor. To be successful as a leader, your organization must transcend you and you must be humble enough to acknowledge that. If you are indispensable to your organization, then your organization will not last after you’re gone. You need to strive to build an organization centred on a mission or purpose rather than an organization that is centred on you.”
Bawany writes that a key part of any succession strategy is hiring people whom you respect, whom you regard as equals and “co-leaders.” This close core of co-leaders can help you build your company, steer that growth toward a vision you all mutually share, and challenge your beliefs every single days.
Brenton Hayden, the founder of rental property management company Renters Warehouse, touches on these same ideas in a piece for Entrepreneur. Three points from that piece deserve closer examination:
Train someone to eventually take over for you. “There’s no such thing as a ‘ready-now’ successor,” Hayden writes. “Even the best candidate will require some degree of training to prepare them to take over your job. They’ll get there in time.”
Empower that person. “I sought to empower many of the key executives at my company. I gave them full access to the books and called upon them for important management decisions. From the start I saw to it that they were involved with everything from branding to hiring decisions.”
Track his or her growth as a leader. Hayden says he measured certain performance metrics such as month-over-month growth, customer satisfaction ratings, average units under management per employee, new accounts and cancelled accounts. “Having numbers such as this holds people accountable, measures success and gives peace of mind when you review the numbers on a weekly or monthly basis. As a retired CEO, this allows me to stay out of the day-to-day operations of the company, but still gives me the chance to step in and advise should something indicate a problem.”
Every employee’s personal life has a real and often measurable impact on his or her work life.
When employees have a rich, fulfilling life outside of work that often impacts their work positively. They’re more productive, more thoughtful, more collaborative and more motivated to help strengthen your company’s culture.
But there are limits to how far a company can go to influence someone’s personal life, and for good reason. Personal lives are just that: Personal.
Therefore, it takes a little work to explore the specific limits of your ability to help an employee enjoy a life outside of work. The trick is to communicate frequently and transparently, and to think holistically about any employer involvement in someone’s life outside of work.
A Holistic View of Work Lives and Personal Lives
Workplace consultant Susan LaMotte writes at HBR that when human resource departments and managers try to gauge how engaged or productive employees are, they concentrate on the work experience and tend to ignore external influences.
“That’s the core problem,” she says. “When we only try to understand and affect what happens at work, we ignore the most basic tenet of person-organization fit: employees bring their whole selves to work. What happens after the workday may be just as important as what happens during it.”
In her work, LaMotte takes a more holistic view of each person by considering their work, their relationships, their internal selves and their external selves. This model can deliver powerful insights for company leaders. A few examples from LaMotte’s piece:
Long commutes can affect how engaged employees are during early morning or late afternoon meetings.
Employees with young children might be hesitant to take vacation days because they want to save that time for personal days when childcare might be necessary.
From this perspective, we can quickly come up with a list of places in employees’ personal lives that affect their work:
Health and wellness
Stress from financial concerns
Their commutes (or their ability to avoid that commute by working from home)
Vacation time
Work creep
You can make a convincing business case for getting involved with any of these parts of an employee’s life. The question is how far should a company go. That’s really a three-part question: How much time and money should be invested, how beneficial are your efforts as an employer, and what legal and ethical limits are there?
Let’s try to answer these for each relevant dimension of an employee’s personal life.
Health and Wellness
This is probably the thorniest issue because, as some companies are learning right now, there is a fine line between trying to promote wellness at work and discrimination.
If you were to just approach employee health as a dollars-and-cents issue, you would find some real financial incentives to have healthy employees. The Affordable Care Act’s employer mandate puts business owners on the hook to some extent for an employee’s health, and as Dan Cook at BenefitsPro points out, most businesses see a direct correlation between how healthy people are and how productively they work.
For these reasons, employee health programs tend to show a solid return on investment. Legally, a company cannot demand that an employee participate in a wellness program, nor can it encroach on right-to-privacy laws by asking for data from a person’s health app or FitBit. But a company can incentivize participation in a health and wellness program through financial rewards, and this is where ethical lines blur quickly.
The New York Times‘ Tara Siegel Bernard reported in October on a program at New Jersey’s Honeywell, which doles out health insurance penalties to employees who don’t report their weight, cholesterol levels and other health data. “Federal regulations require that such wellness programs be voluntary,” Bernard wrote. “But for some workers, it may not feel that way.”
Courts are deciding right now how legal these practices are, as the U.S. Equal Employment Opportunity Commission has filed a lawsuit against Honeywell.
But to focus on those details misses the bigger issue: Thinking of employee wellness in financial terms is an impoverished viewpoint for any leader to have. Micromanaging your team’s health is sure to undercut any positive aspects of company culture you’ve built.
Instead, you should talk to your team and find out what wellness programs they want. “Health care and wellness is an employee benefit,” the Society for Human Resource Management’s Nancy Hammer tells NPR News. “So you’ve got to do something that is attractive to your employees.”
Dave Rietsema at HR Payroll Systems has a few tips for rolling out such a program:
First, make sure it feels like a perk rather than some tacit obligation.
Make those perks enticing. He suggests wellness-specific paid time off or discounted gym memberships as perks that would be attractive to potential hires.
Be lean with the program’s implementation. Get feedback quickly, and make changes when necessary. “The rate of employee participation in the program, the productivity of participating employees versus non-participating employees, and worker satisfaction with the program should be used to determine success,” Rietsema says. “After a long period of time, employee retention, overall company productivity, and return on investment may also be used to evaluate program success.”
Financial Planning
Financial stress can be just as disruptive at work as health issues. In fact, nearly half of the people State Street Global Advisors surveyed for a 2015 report on financial wellness programs indicated some emotional stress due to finances, and a quarter of people indicated some physical stress due to their finances.
And employees seem to overwhelmingly want financial planning help from their employers, that survey found. More than two-thirds of employees reported taking advantage of banking services, financial planning tools, one-on-one financial advising and financial management education when their employers provided it.
Unlike health issues, it can feel much less disruptive for an employer to discuss financial planning with an employee because so much of that relationship is already financial.
Still, as Dan Kadlec writes at Money: “Employers don’t relish this role. It comes with lots of questions about fiduciary duty and liabilities related to the advice that is proffered. Yet legal obstacles are slowly being cleared away to encourage more employer involvement, which is coming in part out of self interest.
“Financially fit workers are more productive and more engaged, research shows.”
The business case for financial wellness programs is there, too, according to the State Street Global Advisors report. Early evidence shows that for every dollar spent on such programs, employers save between $1 and $3 via reduced absenteeism and increased productivity.
Again, the question then becomes how interested your own team is in financial advice. When offering such a perk, seek feedback early and often.
Remote Work
Kin is already on board with letting all of our team members work from wherever they like. The benefits for the company are numerous:
Additionally, remote work can alleviate financial strain on an employee, particularly someone who has a long commute. “Each case is different, but ditching that daily commute alone can save commuters more than $100 monthly,” Darren Murph writes at Remote.co. Murph is offering a conservative estimate, too. Someone with a long commute — say, an hour each way — could easily end up spending several hundred dollars per month just to get to work.
We also stand by our belief in the importance of taking a vacation. The harder question is figuring out how to incentivize people to actually take their vacation days.
Unlimited time off did a bad job of that in our experience. That sounds like an attractive job perk when attracting candidates, but in practice it made people wary of leaving the office.
More than a few companies have publicly introduced vacation stipends. Having a company pay for your vacation sounds like a killer perk, right?
Well, maybe not.
Bloomberg‘s Rebecca Greenfield reports that some companies appear to be trying to get an extra return on those stipends. She mentions two California companies specifically that require anyone who takes advantage of the stipend to update the company’s social media with vacation posts.
That sounds like work creep, but Greenfield says most people were OK with that arrangement. “That these trips come with strings attached didn’t bother any of the employees who spoke with Bloomberg,” she writes. “Even those who had to use up their paid vacation time didn’t see it as an imposition, and free money tends to push the vacations in a more adventurous direction.”
Still, if you’re serious about encouraging employees to get out of the office, our data suggests having a generous, finite amount of vacation time works best. A $1,000 vacation stipend looks good on paper, but in practice you are probably better off just giving each employee a $1,000 bonus.
Dedicated Efforts to Keep Work at Work
This is the flipside of remote work: The tools that make working from home possible for so many people also make it easy for work to intrude on your personal time.
A widely cited 2015 study from WorkplaceTrends.com found that 1 in 5 employees spends at least 20 hours of personal time on work tasks each week. It also found that nearly two-thirds of workers report that they feel their managers expect them to be reachable outside the office.
Obviously, there are situations in which it is necessary to reach someone outside of work hours, but if that expectation looms too large, or if team members are putting in an additional half week of work on their own time, people are going to get burned out.
Sometimes, team leaders and managers simply don’t realize they set these expectations so it’s up to them to develop internal intelligence to avoid putting unnecessary stress on people.
Nicole Fallon at Business New Daily has a few tips for building this awareness into day-to-day operations:
When catching up on emails toward the end of the day, explicitly write out whether a message is urgent or whether it can wait until the next work day.
Speak with team members about how much work they take home with them.
Set the tone by providing information about activities outside of work. Doing so can help communicate the fact that you want your team members to develop rich lives outside of work.
