Time and again when talking to business owners these days, I keep hearing the same thing: “We can’t hire enough of the right people.”
I have a client who’s had a critical position open for almost a year, and they still don’t have any great candidates lined up. I know a bunch of companies that would love to add a great salesperson and even more who could use someone with leadership capabilities to help manage growth.
The good news is that the economy is enabling growth—but that growth is definitely being hampered by an inability to hire. Even Amazon needs help, which is why they’re trying to make a splash with advertising to hire 50,000 people in one day. Bottom line: You need enough of the right people to grow your business, and those people are much harder to find these days.
With a clear shortage of good employees, the first step for business owners is making sure to retain the great people who are already on the team.
When the economy was down, few were hiring and employees were willing to put up with a lot just to keep a job. That’s not the case now. These days, it’s much easier for them to leave, and anyone who’s had a bad experience with their employer is out looking for something better. Strategically, you need to be thinking about the best way to keep your top employees. Here are a few ideas or perspectives that might help you:
Focus on Great Rather Than Just Good
Here’s a simple (but definitely not an easy) idea. The Container Store takes the approach that 1 Great Employee = 3 Good People. It’s as straightforward as it sounds. In their experience, one great person can easily perform at the level of three good people, so by hiring (and keeping) only great performers and paying them 50 percent to 100 percent more than other companies, giving them a lot of training and generally making them happy, the company is able to prosper. Three times the productivity at twice the cost – the math makes sense, and you don’t have to hire as many people.
It’s like Steve Jobs said: “A small team of A+ players can run circles around a giant team of B and C players.”
Do you currently have any great employees? What would it take to start focusing on just building on great employees and having fewer employees overall?
Consider Paying a Lot More
If the idea of strong growth and excellent profitability are appealing to you, then it might be worth checking out how Costco does things. They are a high-growth retail organization that consistently posts record profits in an industry that is struggling. A big part of that is due to their subscription business model and the types of products that they feature and sell. However, they also are widely regarded as having great customer service, and they happen to pay their employees a lot more – almost double, in fact. Costco employees average $20.89 per hour. Because of that, they get best candidates up front, and they tend to keep them a long time, which means they’re spending a lot less on employee turnover.
Have you considered paying noticeably more than what your competitors pay? What changes would you have to implement to make that work?
Invest in Your Team
Employees have a lot more choices today when it comes to where they can work, so it’s important to think about your open positions in the context of a competitive marketplace. Money is always going to be a big driver, but the right kinds of employees are also looking for opportunities. You want to hire someone who’s looking for a career, not just a job. And those employees are looking to grow. They want training and development and a career path that has room for growth. Unfortunately, it’s not as simple as just sending someone to a couple of classes every year. You need to be asking what those employees want to be learning and pairing that up with what’s needed to prepare them for the next step as you grow with them. That takes time and planning, but the payoff is the advantage you’ll have when it comes to hiring people who want to grow. They’ll be engaged, and you’ll be keeping them a lot longer.
Are you investing in your team now? What kind of training and development could you be offering that would make an impact?
Focus on Performance, Rather Than Hours
You may have heard of a new HR trend called Results Only Work Environment (ROWE). The idea is simple: You don’t manage your employees, you manage the work that needs to get done. The employees are focused on getting the work done, and it doesn’t matter where they do the work, how they do the work or when they do the work if it’s done well and on time.
That means no more tracking hours or vacations, and it’s likely people will be working from other locations. It’s a huge change for most businesses, and it certainly won’t work for everyone, but companies that have made the transition successfully report much higher productivity. Their employees are much happier and more productive, and the company has better outcomes.
Ask yourself: What would it take to focus more on performance rather than hours and how the work is done? Is this a concept that makes you uncomfortable? Why?
What about you? Are you challenged to find enough of the right people for your business? Have you tried to do anything about it? Have you lowered your standards for hiring?