I’d have a lot of money if I could have a nickel for every mistake I’ve ever made. But if I could have a nickel for every recruiting mistake I’ve ever made, well, I’d have a fortune!
Recruiting, of all the activities you have as CEO, is the most important. And recruiting is also the most time-consuming activity you have as a CEO.
You have to meet with a lot of people to find the right candidate. It’s painful. And you’re under so much pressure to hire!
The pressure to hire leads you to make mistakes. And the hiring mistakes can be killers.
I’ve made a list of the four biggest mistakes that CEOs make recruiting their team. And you know what? I’ve made all of these mistakes except for one of them.
I’ll let you figure out which one I didn’t make.* So here goes.
Mistake Number One: Hiring “B” players instead of “A” players because you are under so much pressure to hire someone.
The thought process goes like this:
“I’ve been looking for this role for months, and I can’t find the right person yet. So, instead of holding out, I’m going to hire Bill.
“Now, Bill’s not the best person out there. He’s not exactly what we need. He’s not exactly at the level we want.
“And, I’m going to have to support Bill a lot! I know that.
“But we need someone, so I’m going to hire Bill and hope for the best.”
It all goes back to the intense pressure you are under to hire. And sometimes (myself included) you succumb to the pressure.
And you just can’t succumb to the pressure. Because you always pay the price hiring people that you know aren’t right for the job.
Every single time I’ve done this (hiring someone that I know isn’t right for the job), it’s blown up in my face. So you’re better off waiting to find the right person than hiring someone that isn’t right for the job.
Hiring the wrong person can really bite you as your company gets bigger.
You’re growing fast, and your company has all these open positions to fill. And, if we don’t fill all of these positions, we’re not going to grow fast.
Well, again it’s the same problem. Your company will eventually pay the price if you hire people that are substandard.
I was working at a very large company that was extremely successful. The company had an incredibly high level of talent.
Then we started hiring B players instead of the A players we had hired throughout the company’s lifetime. Worse yet, we were hiring these people into senior management roles, so their negative impact was magnified.
Eventually, these problems came back to bite the company. Every one of the senior managers hired into these roles failed.
And eventually the company stopped growing. Profitability suffered and the talented people started leaving the company.
Mistake Number Two: Hiring people that don’t fit your culture.
Let’s talk about Bob. Bob’s a brilliant engineer. In fact, his skills are off the charts. But there’s a downside to working with Bob.
Bob gets into fights and shouting matches with everyone he works with. He can’t deal well with people.
Bob’s got all these personal problems. But, you know what? We need Bob because, if we get Bob, Bob can pay off big time for us. So let’s take the chance on hiring Bob.
The odds are that Bob will not work out.
I’ve hired people like Bob before. And again, every single time I’ve hired someone like Bob it hasn’t worked out.
You usually pay the price when you hire that superstar that doesn’t fit your company culture.
How? Morale in the company suffers. Coworkers leave the company. And usually the superstar employee leaves the company too.
So, why do you hire someone that you know could be trouble?
You’re under so much pressure for your company to succeed that you take the chance and you hope things will work out.
The message is simple: Stay disciplined. Pass on the troubled superstar no matter how much you think you need the person.
There’s always somebody else that fits your culture that can help you.
Mistake Number Three: Using recruiters to do the recruiting for you.
This is especially important at the start of a business. You know better than anyone else what you need when you are starting a business.
You know better what you need inside your company. You know better the nuances of the different roles inside the company.
A recruiter simply isn’t going to know these things like you will. You’re going to think you’re saving time using a recruiter, but you’re not.
A recruiter is going to bring you masses of people that just aren’t quite right. Then you end up spending time interviewing people that you know you shouldn’t hire.
I know it’s a pain. I know recruiting can take up 80% of your time. But you know what? There’s nothing more important then recruiting to your business because people are the most important asset for any startup.
So use your time wisely. Spend your time doing the upfront recruiting legwork, and you will not regret it.
Mistake Number Four: Not checking references.
Always check references when you hire people. There are two types of references checks you want to do:
- Front door references. These are references the potential employee gives you.
- Back door references. These are references you find on a potential employee.
Front door references. You want to ask a potential new hire for three things.
- A peer reference. Someone they’ve worked with.
- A boss reference. Someone they’ve worked for.
- An employee reference. Someone that’s worked for them.
You get a pretty well rounded view of a potential employee by checking these three types of references. And you want to call all of these people because you never know what you’re going to hear.
Sometimes you find out the reference check may be negative even if the reference is provided by the hire. For example, I remember interviewing a potential VP engineering candidate.
The candidate gave me three references including a friend of mine. I called my friend and asked about the candidate.
My friend was negative about the candidate. In fact, the candidate hadn’t even asked my friend to be a reference.
We passed on the candidate because of the poor references.
Backdoor references. These are references that you are not given. Instead you use your network to find out about a potential new hire.
Usually, you are one or two degrees of freedom away from anyone in any industry if you’ve been in the industry for a while. So call people that you know and talk to these references.
Do one other thing before you talk to their references. Ask the potential hire, “What am I going to hear about you from your references?”
In fact, I’ve said to potential candidates, “I’d rather hear anything bad about you from you before I hear it from a reference.”
I’ve been asked the “what am I going to hear about you” question by investors. And I always appreciate being asked because I can be honest AND get ahead of the story.
Sometimes references, especially backdoor references, can have an agenda. And the backdoor reference’s agenda might be to hurt the candidate for no good reason.
Or the backdoor reference might make a story worse then it really is because time has passed and their memory of the situation is distorted.
There are people out in the business world that don’t like you. And the longer you’ve been in business, the more likely you have some haters out there. It’s normal.
I’ve been burned by negative backdoor references, so I am especially sensitive to backdoor references. I always want a perspective and an understanding of where the backdoor reference is coming from.
One more thing. You SHOULD interview the first 50 people you hire.
One of the things I did with any organization I ever ran was interviewing the first 50 employees we hired. I also had a new employee orientation meeting every month for the new employees we hired.
You should interview the first 50 employees for several reasons:
A. An early stage potential employee will want to meet you before they join your company.
It seems obvious. You’re the CEO, and candidates are going to want to pass judgement on you before joining your company.
And it’s your chance to share your vision with potential employees. So let it fly. Be open and honest, and answer all their questions.
There’s an obvious advantage in you interviewing your first 50 hires because…
B. You get to help close potential employees.
You’re answering the candidates questions, but you, as I said above, get to share your vision and convince the candidates why they should join your company.
Remember that great talent has its pick of where to work. What makes your company 10X-100X better than the other opportunities they are evaluating?
In this way, recruiting is like pitching to investors or customers. You’re selling. And you’d better be convincing or you will not close the deal.
C. You get to make sure the potential employees fit your culture.
Cultural fit, as I said in Mistake 2 above, is one of the most important indicators of a successful company. And hiring someone that doesn’t fit your culture, no matter how good they are, can really cause problems.
The bottom line is don’t hire any brilliant jerks, and step in as needed if someone else wants to hire a brilliant jerk. Having hired a few brilliant jerks during my career, I can tell you with certainty the brilliant jerk is never worth it. Never.
D. You get to know your potential employees names.
Until you hit Dunbar’s number of 150, you will likely be able to memorize the names of your employees. Interviewing the first 50 will give you a running start.
Then holding the monthly new hire orientation meeting is a great way for you to learn the rest of your employees names. Plus, it’s a great way for you to keep selling them on your vision.
Summing it all up…Recruiting is one of the most important responsibilities, if not the most important responsibility, you have as a startup CEO.
You’re under intense pressure to hire the best, so you can’t afford making mistakes. Avoiding the mistakes of hiring B players, hiring people that don’t fit your culture, using recruiters to do the work you need to be doing, and not keeping the discipline of checking references will give you a much better chance of building a great team and a winning culture.
- What is the one recruiting mistake I didn’t make? Using recruiters!