Three Hiring Mistakes Small Businesses Make
In this presentation Matt Vaadi (also introduced as Matt Beatty) shares his 12‑year experience helping organizations hire and onboard talent, and outlines the three most common hiring mistakes small businesses make, along with concrete actions to avoid them. He begins by emphasizing the high cost of bad hires and the critical first‑10‑day window for new employees. The first mistake is a lack of preparation – missing job descriptions, onboarding logistics, and a vague interview process, which can lead to a "bozo explosion" of low‑performing hires. He recommends creating a documented, role‑specific interview process, setting SMART 30/60/90‑day goals, and using a pre‑hire checklist to ensure equipment, logins, and introductions are ready on day one. The second mistake is rushing the hire; he urges leaders to slow down, enforce process safeguards, share clear expectations with both the team and the candidate, and conduct a "lockdown" interview to gauge candidate commitment. The third mistake is an unclear hiring target; he advises building an employee persona, aligning core values with interview questions, and sourcing candidates through personal networks and targeted outreach rather than generic job boards. Throughout, he provides anecdotes (e.g., a poor first‑day experience, the bozo explosion story) to illustrate the impact of each mistake. The talk concludes with a brief overview of ERG’s services – HR outsourcing, recruiting for sales and HR roles, payroll and compliance tools, and a free 60‑minute HR diagnosis – and invites listeners to contact him for help.
Chapters
Good afternoon, and thank you for joining us today. My name is Matt Beatty, and today we're going to be talking about the 3 biggest hiring mistakes that small businesses make and how to avoid them. So you may be asking yourself, why am I qualified to discuss this topic? And that is a great question. Over the last 12 years, I have helped hundreds of organizations to hire thousands of people and done so personally inside of organizations as well. Interviewed and hired hundreds, if not— well, interviewed thousands, hired hundreds, and kind of seen everything that you could possibly see during the hiring process from pre-hire screening and assessment all the way through to the onboarding process and all the things that occur in there. And we do that today for a host of companies throughout the Southeast to help them to improve their hiring and human resources related processes. So I'm really excited to talk to you about this because hiring is quite frankly my favorite thing to talk about, my favorite thing to learn about and be a part of, and really excited to share some of the things we've learned from our clients and from our own mistakes and how you can learn from our mistakes and avoid them yourself. My contact information is on the screen. Should you need anything from me, please don't hesitate to reach out and reach me at matt@ergparole.com. I'm going to reference several different templates and forms during the course of this conversation. And so, if you want any of those, please don't hesitate to drop me a note. Or if you go to ergparole.com, you can find tons of HR resources under the Resources, HR Resources, and Blog tab in there. Lots of great stuff that we're updating every single week. So with that said, let's go ahead and get started. So hiring is incredibly important, as everybody on this call and those of you watching the video know. First of all, bad hires are just very costly. So not only is there the cost of, you know, all the screening and interviewing and all the time that you've invested into bringing on this new hire, but the training once they come in the door, and also potentially the impact they make on those around them. So if you hire somebody who's not a great fit for the role, then they have the potential to have a negative impact on other people in their department or in the organization. I mean, so the ripple effect can be tremendous. And, you know, we've actually had this happen as much as we— you know, they often say the shoemaker's daughter has no shoes. You know, we've made the mistakes and made bad hires in the past, and we've seen, you You know, what happens when you bring somebody in who maybe you don't follow some of the steps that we're about to talk through and you cheat yourself on the process and then you wind up with the mistakes that, that lead to bringing a bad hire in the door. And we always talk a lot about you have 10 days to impress on somebody why they should stay with your organization long-term. And the reason that is, is because in the first 10 days, the majority of your hires are going to decide if they're going to be looking for a new job in the next 18 months Do you really want to have a solid hiring process from, once again, stemming all the way back to that initial screen through onboarding, where it's synchronous and people have a great experience that they can, that is memorable for the right reasons and not for the wrong reasons? And then finally, we talk a lot about, I heard this once from a gentleman I know here in Columbia, Sean Regan, CEO over at RhythmLink. He told me a long time ago, When you can hire, you can fire. And so once you have a great hiring process in place, you're able to get rid of those bad hires without fear of having an open role on your team that is not contributing. And so as soon as you can have a great hiring process, you're able to make hiring and firing decisions that are best for the organization. And like we always say, the great news is A-players are free. When you hire great people, they pay for themselves and then some. So you always want to make sure your hiring process is solid and you're doing everything you can to stay disciplined in hiring great people. So that's one of the— several of the reasons why hiring is so important. Let's dive into some of the mistakes that small businesses make regularly when hiring. So the first mistake is that you're just not prepared. This is really common among small businesses in that when you go to hire this person, you bring them in the door and not only are you not prepared in that you don't have a proper job description and tasks and work ready for this individual and how to train them on how to do this work once they get there, but you're also not prepared for this individual when they walk in the door the first day. You don't have their computer ordered. You don't have their login set up. You don't have all those things that you need to have for a person to walk in and capitalize on those first 10 days to make them meaningful and appropriate for somebody joining your organization. We talk a lot about the bozo explosion. Many of you probably heard about this, where Steve Jobs talked about in the early '90s when they had to start hiring quote-unquote real employees and managers from other organizations with management experience. A lot of these managers were what he deemed B players. And the thing about B players is they don't want to hire A players because A players will take their job in their mind. They hire other Bs and even Cs because they're too insecure to hire an A player. So when you have a B who's hiring a bunch of Bs and Cs, then you wind up with a bozo explosion. So we want to try to avoid that, and here are some of the things we can do to be prepared to avoid that. So your action items, and this is the format we'll follow for each of these, so 3 major mistakes along with 3 action items you can take to correct those mistakes. First of all, a lot of you are saying, "Well, create an interview process." We've already got an interview process. I've got this list of questions I ask everybody after I talk to them on the phone for 10 minutes, and then if they do great in that interview, then I check their references and then we hire them. Well, that's great, and that's part of a process, but is it the same each time you hire a person? Is it the same if you have multiple people involved in the hiring process? Does everybody follow the same process? And do you have a unique for each role? So not every role should follow the same exact process. But in the short term, you do just want to create one process that says, hey, in ours, it's quite simple. We have step 1 is to screen out a candidate with a phone screen, 15-minute conversation where we've got the same set questions we ask every single time. And if it's somebody we're interested in bringing in for an interview, we bring them in for the initial, what I would call behavioral interview, where we're asking a lot of those questions you'd expect to have in a job interview. And then if they do great in the behavioral interview, we bring them in for what we call a performance interview where we go through each of their jobs in detail and see about the work that they've done and how that aligns with what they're going to be doing inside of our organization. Then finally after that, you're going to go into a reference check where you're going to make sure that this person is who they say they were. And ultimately where you'd really like to be, the next stage beyond that, because so one of the things we're doing throughout that process is grading this individual. On an ABC scale, where do they fit? Are they an A player? And if they continue to check the box as an A player, they continue to make it to the next stage. Ideally, what you'd like to do at the end of that process, and quite frankly, something we haven't done as much as I'd like in the past, but a lot of my clients, we recommend it every time, is that you bring that individual in for either some time to shadow somebody who's already doing the job, you take them out to lunch, you spend some time with them where they get comfortable and they let their guard down a little bit, Instead of just having that, I'm on my best behavior, I'm in an interview, you've seen me for 2 hours, I've been nothing but the greatest behavior you're ever gonna get out of me, you wanna actually see them when they let their guard down a little bit. You wanna see them break some bread, maybe see what types of things they bring up over a meal after they've really let their guard down some. So make sure one way or the other, you don't have to get as in-depth as that, but you have to have a process that you follow and you have to be thorough with it and it's a very simple thing to document. So create an interview process. I've got tons of great templates and information on that. Don't hesitate to drop me a note if you need anything. You then want to have some goals for this person. And this, this is probably one of the easiest things to do that people skip on all the time. Just 3 goals for each step of the first 30, 60, 90-day goals. So I'll use an example of you bring on a salesperson. In the first 30 days, I want them to be able to set 5 appointments. So, what does that mean? Well, it doesn't really mean a lot that they set 5 appointments in the 30 days, but it means that we had to train them on multiple things for them to be able to get to that point. We had to train them on their phone skills. We had to train them on how to get set up on our systems and document those conversations. We had to train them on, you know, how to manage a meeting once they get there. So, focus on the end result of what you'd like to see at 30 days. So, things that are, you know, if it's a customer service related position, for example, I want them to be able to handle you know, multiple phone calls independently each day without having to lean on their manager, you know, or 20 phone calls, whatever it might be. But have a SMART goal. And if you need help setting SMART goals, you can just go into our ERG Payroll YouTube channel and find our video on SMART goal setting. But have goals for the first 30, 60, and 90 days. This is something that you can tweak over time, but will have— pay huge dividends when it comes to improving your hiring process. And finally, on the first section here, you're not prepared, you need to prepare for onboarding. It's funny, one of our, one of our clients, they onboard a lot of new hires, and we've spent a good amount of time trying to improve their employee onboarding process because they were having high turnover. And high turnover is a direct result of a poor onboarding process. And one of the smallest, subtlest changes we made to their onboarding process was implementing a pre-hire checklist that each manager has to complete before a new hire comes on board, but it has made the biggest impact of any one thing we've done during onboarding. Because now every time somebody comes in the door, we know that they already have their login set up, we know that their computer is ready, we know that their, their team has been alerted to it, we know they've got an email that says, "Hey, here's where you should park, here's who you're looking for when you show up." About, I guess, what's going on 8 to 10 years ago now, I started a new job. Golly, maybe 10 to 12 years now. I started a new job with a Fortune 500 company and I walked in the first day and I'll never forget it for all the wrong reasons. I walked into the lobby. I said, "Geez, I don't even know who I'm supposed to ask for. I guess I'll ask for the guy that interviewed me and made the offer." He wasn't there. So then I asked for the only other person I talked to. He wasn't there. And then I asked for their secretary who had worked with me a good bit during the process of just getting new hire documentation in order and all that. And she was there. And then she said, "Oh geez, I didn't know today was your first day." And they guided me to an empty cubicle that they thought may or may not be my cubicle. Didn't have my computer ready. Handed me a stack of documents. "We think this is the stuff you're supposed to fill out." They then said, "All right, why don't you go over here and shadow over Stephen for a few hours." doing what you're going to be doing, and so he's probably a good person to talk to. And it was just— I'll never forget it because I expected more. I had higher expectations and I was let down. And so that, that stuck with me all this time, and it's going to stick with your new hires if you leave that same impression with them. And so you really want to create a great impression. Be prepared. We've all seen these LinkedIn posts over the last, you know, 3 years where everybody's got their computer set up with their t-shirt on top of it and their tchotchkes and all this stuff. And we're so excited that Rachel just came in today and we're welcoming her with open arms and signs and hugs and balloons. And so, that's the expectation that people have when they walk in the door. And you've got to be able to meet that to the best of your ability. And we say all that to say this. I mean, great culture is always intentional. And when you're trying to create a great culture, it starts at that point of hire for these people. And they want to carry that on and they want to carry on that legacy for the next person that's behind them. So when you're trying to be prepared, you want to not only have an interview process and be prepared for that individual when they walk in the door by having tasks and training and goals prepared for them, but also just be ready for them, you know, physically and logistically when they walk in the door. So second mistake is people rush the hiring process. You need to slow down. You need to not talk like I talk, fast, and you need to go slow. We— you've always probably heard the hire slow, fire fast mentality. And, you know, we all— we often have to temper people's enthusiasm with how quickly they want to fire people. We get calls about once a month about, I want to fire this person. Why do you want to fire them? Oh, they're a bad fit. Okay, well, how long have they been there? About 3 days. Okay, well, you can't fire somebody after 3 days for being a bad fit because you have not provided them with the resources to determine if they can do the job yet. And And so that is not an appropriate reason to fire somebody. But if somebody has not been doing the job and they've been in their role for months and months and they're doing it very poorly, then you may want to look at that. But let's focus on the hiring side. And that's— we want to go slow. We want to find the right person because ultimately a bad hire costs a lot more than an empty seat. So what are our action items for hiring slow? First of all, we wanna follow that process that we just talked about. This is the biggest thing that I see people do is somebody comes in for that first interview, they lay down a really great impression and you get excited and you get ready to make them an offer on the spot. No, you have to have checks and balances that say, hey, we're gonna follow these 4 steps and you have to grade out to be an A before we're going to make an offer. So make sure that you have that process and you have safeguards to stop yourself from making an offer too early in the process. Sometimes this can be an emotional decision, especially in smaller businesses or in smaller teams where you know that the work is going to fall on you if this individual doesn't come in. So you want to make sure that you protect yourself from yourself by having a set process. Then you want to create and share expectations. So this is twofold. So you want to create and share expectations with the rest of your team. So anybody else that might be involved in this hiring process that's helping you to facilitate these hires. And then also, this is critical during the hiring process with the new hire. So, you want to not only be able to share with them, "Hey, this is the job that you're going to walk in and do, but here's what's expected of you, and here's how our dynamic is different than a normal office." We see this play out all the time internally at ERG because our roles are constantly changing. I just had a monthly plan and review conversation with one of our teammates yesterday where, when we look back to a year a year ago of what she was hired to do versus what she's doing today, it is a completely different job. And that was part of the expectation coming in is that, hey, it's dynamic here. We're changing constantly. We're growing rapidly. Things are changing and you need to understand that you can't come in and expect that you're just going to create this one widget day in and day out and be comfortable with that. Things are going to change and be dynamic. And for some of you, it might be the opposite. This person might be expected to just come in and make that one widget day in and day out and might get bored if they're not. And you have to be really clear with them, otherwise you're going to lose them very early in the process. We do what we like to call a, you know, I stole a term from one of my former employers, but a lockdown with a new hire where if you can talk this individual out of a job in 10 to 20 minutes or over several interviews, then how quickly do you think they're going to leave your job once they start? So, simple things like, "Oh, hey, this, you know, when I made you— when you originally came in, you said you were looking for $60,000 a year. We're only offering $50,000 a year. You know, why would you be willing to accept this offer if we made it? And are you going to leave as soon as you get that offer for $60K from somewhere else?" Or, "Hey, this is a little bit further drive than what you're used to, and I know that, you know, you want to get home early to spend time with your family. It's something you mentioned during the interview process. Are you going to be able to sustain this longer commute?" And so, really just trying to share some of the negative things about the role. And I know that sounds counterintuitive to a lot of you because we're always trying to sell somebody on joining our company and pushing our employment brand and all those fun things. And there's definitely a lot of value in that. And with a tight labor market like we have today, you have to do it. But you also have to understand, if you can talk this person out of this job in a couple of conversations, then wait till they get in it. They'll be gone in a few months. So Create and share expectations, both positive and negative, and then just be strict to your criteria. Don't fold just because you, once again, you've got an empty seat, the work is falling on other teammates, morale is dipping a little bit as a result. We've all been there. When somebody leaves, it's hard on the team, or even if it's a new role where you've grown to the point where you're adding a new position and other people are pushing to their max. I'll tell you, they'll be a lot more upset if you bring in a B or a C player to pick up that work and then they have to deal with that person's mistakes, bad attitude, whatever that might be. You'd rather bring in an A-player and take your time and be diligent and hire slow. Now, the third mistake we see all the time is that the target is just not clear. So, say this all the time. I somehow weave this into just about every presentation we do, but if you aim at nothing, you will hit it every single time. I can't tell you how many clients and how many employers out there say they want one thing when they're looking for an employee, but really what they want is something completely different, or they hire something that's a third option that is none of the above. And so you have to come up with a very clear target on what you're looking for out of your next hire when you're involved in this process. And one of the ways that we found is best to do this is by creating an employee persona. And so what is an employee persona? Many of you are probably familiar with in marketing There's a term called a client persona or a client avatar, a customer avatar, which is where when you're getting ready to market a product, you don't want to just market it to every single person out there. You want to market it only to the people who are interested in possibly purchasing it. So you are trying to learn more about your target audience. You want to know where they live, what their, you know, what their target income is, what their hobbies are, what their goals are, what their family life looks like. You're drawing a picture so you know exactly who you're speaking to. And we do the same thing with employee persona so that you can get crystal clear and hone your message to the right audience. I saw this play out recently a few months back with one of our clients where we went through this exercise and they thought they were looking for somebody with one background and they said, "Well, you know, we've got these people that they come out of the local university." They get their MBA, then they come into this role, and it's the perfect role for them to get started in the industry. And, you know, and so we kind of looked at that person versus another person who, you know, maybe just came out of undergraduate, was really scratching and clawing, trying to prove themselves. And we looked at past hires. Who has been successful in the role? Who has had a great amount of success and stayed with the company? Who do we want this person to be like and what are their values? And then what is their background? Where do they come from? And what we started to realize was that it was more of this undergraduate person, particularly who was in this one major program. And then beyond that, they also belonged to this one club. It's, we actually narrowed it down to this one club at the university that most of these people all belong to. And it was one of the few places that they socialized. They were mostly an introvert by nature. So we reached out to the person who headed up that club at the university and started letting them know, hey, we are looking for somebody who looks and talks and acts like this and has these career goals. Can you help us to find this person? And so instead of just broadcasting a job posting on Indeed.com for every person who wants to apply out there and having to ferret through hundreds and hundreds of applicants, now we've got a consistent candidate pool coming from one specific area and we know that They know what we're looking for. And so that's one example of how you can really narrow that down and narrow your focus and be able to look exactly where those people are. The next thing you want to do is infuse your core values into the hiring process. So one of the things people make the mistake of doing is not interviewing for the— well, first of all, let me take a step back. If you haven't determined what the core values of your organization are, you should probably go ahead and do that. That's something that you could find endless resources for to do, but it's something that is— you need to recognize what's core to your organization. You make sure that people that are showing up and coming in your door recognize and can also work inside of those values. If one of your core values, like ours, is fanatical attention to detail, and you hire somebody that that's not in their blood, that's not in their DNA, and that's not something that they value, then that's going to be a bad fit for your organization. So you need to make sure that this is something that you're talking about during the interviews, you're asking questions that come back to it, and then you're educating that person from day one on what your core values are, and you make sure that they're aligned with them and they embody them every single day, and you wash them with them. I can see them from where I'm sitting in multiple spots, and so can everybody else on the team, and so should your team be able to see what your core values are. So, definitely something you want to infuse from the very start of the process. And finally, probably the biggest mistake people make when it comes to hiring is You just don't start with your own network. Every conversation you have with people that you respect in your industry, or even friends, family, coaches, whoever, people that you're talking to, hey, who are some A-players that you know that I should think about hiring? You should be asking that question frequently and to as many people as possible, because that's going to help you to develop a bench of talent, so when that opening comes, You're not fishing around looking for somebody who doesn't exist. You start to create a network of talent and people that are looking for you and referring people in your direction before you have an opening. You know, we've got a current client right now that, you know, they're getting ready to onboard a new hire that they've had, you know, on the side burner, I would say, for a year. And they haven't had the need, they haven't had the opening, and now finally that opening has come about. And that's come from consistent networking and action and asking that question of people, making sure that you're connecting me with industry professionals with what I do so that when the time comes, I can plug them into my organization. So finally, you want to fish where the fish are. I don't go fishing in Lake Murray, South Carolina looking for a shark, right? So if you're hiring web developers, guess what? Posting ads on Indeed or posting ads on LinkedIn, probably not going to get them because that's not— they're not really out there looking for a job and they're not going to go apply to your posting. You're going to have to go and recruit them. You're going to have to go and find them. You're going to have to go to the meetings where they are and talk to the people at those meetings and network and make it happen. And you're going to spend a lot less time doing more targeted activity than you are if you take the spray and pray approach and go try to catch a shark in Lake Murray. So how do we help if you need assistance with all of your hiring processes? So ERG, we do several things. We do human resources outsourcing, so we can provide a turnkey HR department for your team that does everything from assisting with establishing all those things we just talked about, an internal interviewing process, helping to onboard those employees once you hire them, training your managers on how to interview. Actually sitting in on interviews, some for some of our local clients or even virtually for some of our non-local clients. And this includes everything from payroll, human resources support for both the employer and the employee, and just really becoming an extension of your team in the HR department. We also do recruiting, so we do both staffing and recruiting. We really only focus on on sales and human resources positions. And the reason for that is because we have a network in both of those arenas, sales nationally, HR in mostly the South Carolina and surrounding states. But what we do is we're able to— you know, great example is we just had a client recently where they needed a salesperson. They talked to us about it. They had already engaged another recruiter. They had been looking themselves for months. They desperately needed to fill this role. Within a, within a couple days of having engaged us, we were able to talk to our network, surface 5 candidates on our side, narrow that down to the best candidate, have them phone screen interviewed 2 times, reference checked, and presented to the client within about a week. Whereas that's something that would have taken them months to do on their own, and it was the best candidate that they had. And so our sales network is deep. So if you're looking for sales folks, definitely something to consider. Then we do payroll. And stuff. So, we do a lot of, you know, point solutions that I call online payroll, online timekeeping, background checks, all that good stuff. But, you know, one of the probably most proud things I've heard since working here is that ERG cares about our employees as much as we do, from one of our clients here in Columbia. And, you know, we hope to have the opportunity to care for your employees at some point as well. If you're interested in learning more about how we can support your organization, we can do a free HR diagnosis. This is a 60-minute meeting where we will walk through each of your HR processes and learn more about how you do things so that we can share with you an action plan on how you can improve your human resources and hiring processes. And then if you decide it makes sense to engage us in your journey on improving those processes, we'd be more than happy to do it. So thank you so much for your time today. I look forward to speaking to each of you in the near future. You can check me out online @MattVaadi on Twitter, on Twitter, M-A-T-T-V-A-A-D-I. You can connect with us at ergparole.com or just shoot me an email to the address you saw at the beginning of the presentation. Thanks so much and have an awesome day.
