Slideshow 5 Ways to Avoid Hiring Mistakes

Published
  • September 08 2015, 6:04pm EDT
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5 Ways to Avoid Hiring Mistakes

The success of your business is largely in the hands of the people who work for you, and the relationship you and your team have with your clients is the secret sauce of your business. It follows then that one of the most important decisions you can make — a decision that has lasting impact on the long-term success of your business — is whom you choose to hire.

Yet it never ceases to amaze me that the recruitment process at most firms is an afterthought — meaning there is not a systematic approach for determining whom to hire. Hiring should be part of your strategic plan and you should apply the same vigor and discipline to your firm’s recruitment process as you do when constructing financial plans for your clients.

These five steps will help. – By: Kelli Cruz

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Make hiring a strategic priority for everyone at your firm.

Make your senior team members responsible for generating leads from specific recruiting channels, such as professional associations and alumni networks. Hold them accountable for quarterly networking activities that can lead to interviews with qualified job seekers.

One great way to solicit help from everyone on your team is to offer a cash award for successful employee referrals. Your staffers know better than anyone what it takes to succeed at your firm, and when they recruit a new hire, they take ownership of the new recruit’s success and help with the onboarding.

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Clearly define the role and responsibilities of the position.

These expectations should be written up as a well-articulated job description and used as a marketing piece to inform and attract candidates for the position. The description can be posted to your firm’s website, on associations’ websites (FPA, CFA, etc.) job boards (LinkedIn, Indeed.com, etc.) and other sources you use to attract and recruit employees to your firm.

Job postings not only include the duties, qualifications and reporting relationships for a particular job, they also describe the position in a way that makes it appealing to candidates. Think of this as your marketing piece, so make it attractive to job seekers.

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To find the best match, create a disciplined interview process.

To conduct an effective interview, use your job description to craft questions that compare an applicant’s knowledge and abilities with the role as you’ve defined it. These should also take into account how well their traits align with your firm’s culture.

Also keep in mind that the interview process is a two-way street and that while you are interviewing the candidate, they are also interviewing you and the firm. So make sure to clearly convey the benefits of joining your advisory firm and what sets you apart from the rest of the field.

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Employ tests to more fully evaluate the candidate.

To get beyond the resume and the typical interview format, techniques such as written tests, role-playing and simulations can be used to get a fuller sense of an individual’s persona.

Some firms shy away from testing because of concerns about the costs. Yet testing is far less expensive than the cost of a bad hire. The cost of replacing an employee ranges from 30% to 50% of that employee’s annual salary, while for senior-level positions and jobs requiring more extensive skill sets, turnover costs can run even higher.

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Develop an onboarding process.

Planning for a successful transition from prospective employee to new hire is something that many firms overlook. A strong onboarding process provides information, training and coaching, and begins as soon as the candidate has accepted your job offer.

As you welcome new employees to your firm, you have a unique opportunity not only to gain their trust, but also to instill confidence that they have chosen a great place to work. When managed well, onboarding fosters employee engagement and contribution in line with expectations.

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