Each month, we sit down with an industry expert and ask them to share advice which could prove useful to your small business. We’ve previously covered the importance of support networks for SMEs, tips on keeping meetings productive and writing effective business plans. All previous editions of the series can be accessed using the links at the bottom of the page.
In today’s instalment, we chat with Graham Oates, CEO of Norrie Johnston Recruitment, a company dedicated to finding the right employees at all levels for SMEs. Graham’s vast wealth of recruitment knowledge means he knows more than a thing or two about the challenges SMEs face when hiring, recently conducting detailed research on this very topic for NJR.
Read out full Business Basics interview with Graham below:
Your recent research report on SME recruitment found that just 21% of senior personnel surveyed would prefer to work for a company with fewer than 50 employees. What steps can small and medium-sized businesses take to make their recruitment proposition more attractive to top candidates?
It’s really important to be aware of what candidates are looking for, as it may not just be about the money. Although a competitive salary is important, SMEs should also think about the wider value that they can offer. For example, the opportunity to work flexible hours or work from home can be seen as huge benefit by some candidates, and it’s often easier for an SME to offer this than it is for a large corporation. SMEs can also offer a senior candidate more opportunity to influence the direction of the business, or to be involved in the day-to-day running of the company than an organisation with a large senior management team.
SMEs should also consider other incentives that will add value to an overall employment package, but won’t add extra cost to their bottom line – for example, an increased holiday allowance or an early finish time on Fridays. Senior hires may also expect benefits like private health insurance or life insurance, so it’s important not to forget the perceived value that these things can add.
Digital has become incredibly important for employers seeking out fresh talent. What are the advantages of creating an employer ‘brand’ online, and what tools can businesses use to achieve this?
Often, the first place a prospective candidate will look when researching a company is online – so it’s important that your website and social media channels bring your brand to life. To do that, you need to communicate not just your successes, but also give a sense of who you are and how you work.
On your website, that could mean thinking about the kind of imagery you use to convey your company’s personality and values – or including information about your team and office so that candidates can get a feel for your culture.
When it comes to social media, your channels should be populated with interesting and relevant content so that you look ‘alive’ and give people a sense of what your company stands for. Ultimately, you want a candidate to look at your online presence and think ‘this looks like somewhere I’d want to work’.
Where should the recruitment requirement stem from? Should growing businesses hire simply as the resource need arises, or should this be factored into their strategic business plans further in advance?
This is always a tricky question and will probably be driven by how well-funded the company is, its cash flow and working capital outlook. Whatever the situation, resourcing should ideally be planned well in advance, and the initiation of the recruitment process should take into account likely lead times for finding the right people and any notice periods. This is particularly important for key senior hires who may have notice periods of up to three months. As a minimum, therefore, companies should initiate the recruitment process at least six months before the resource is required to be in place.
What is more important for a growing business to consider when recruiting: whether candidates have direct sector experience, or their transferrable skills and overall aptitude?
It varies with the role. Key operational or content-rich roles will probably benefit from strong sector knowledge and experience. For other roles, such as finance and HR, this is less important and the all-round capability, motivation and cultural fit of the candidate will be more relevant.
When defining sector experience, there are levels of specificity. For example, if the company sells to businesses it will ideally need someone with a strong B2B – but not necessarily sector-specific – background, rather than someone who has spent a lot of their career working with consumers.
What sorts of key questions should small and medium-sized businesses be asking candidates to determine whether they’re a good fit for their goals and culture?
For key hires, particularly in growing companies, it’s important for a candidate to have skills that can help grow the business and therefore a background in larger or more mature companies will be an advantage.
However, candidates need to understand that working in smaller companies requires much more flexibility and the ability to not only plan and manage, but often be very hands-on and not overly concerned about their status and position. In smaller companies, the culture will tend to be much tighter and more personal, and there is typically a lot of focus on short term cash flow. Therefore, interview questions need to be focused on these sorts of issues and should explore: prior experience with small/high growth companies; culture, motivation and personal style; flexibility in style and approach; ability to span from hands-on, nitty-gritty activity to board level activity.
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What tips do you have to help small businesses manage the hiring process effectively? How can they establish fairness and transparency, while ensuring various legal requirements are met?
A clear, well-defined hiring and interview process is key. Things to consider include:
The owner or director of a smaller business will likely want to be part of the interviewing panel, but who else should be involved? Is it important to have the input of a departmental specialist already working at the company?
This depends on the level of the hire. At a senior level, the new recruit will probably be reporting directly to the owner, so it’s sensible for him/her to be the key interviewer. If the company has Non-Executive Directors, they should also be involved. If appropriate, peers to the hire already working in the company could also be included.
For lower level hires, departmental heads may well run the process – again, in conjunction with their peers and the heads of closely connected departments. In all cases, candidates should be given the opportunity to meet a wide cross-section of people within the organisation, so that they get a good feel for the company and their cultural fit within it.
Many small and medium-sized businesses are unlikely to have a formal HR function that deals with recruiting matters. What are the advantages of using a recruitment agency vs conducting the process in-house?
For many SMEs, the HR function will often be operationally focused and may not have either the time or the expertise to manage senior or lower-level volume hires. In these situations, using a recruitment agency can be a cost-effective solution to gaining access to a wide array of talent and managing the overall process. The former factor is probably the most important element as senior hires are mission critical to SMEs, and companies want to be able to access the best talent – irrespective of their size.
Many senior hires will be ‘passive’ candidates, i.e. candidates not actively looking for a new role. Therefore, recruitment agencies are best placed to access these individuals through their research capability and their networks of candidates.
One further word of advice, however: SMEs need to be careful about getting the right agency for them. The big names will often be very expensive and SME clients may not be very important to them. Low end, high volume recruiters will often give low fee quotes, but won’t offer a tailored and expert service. The best fit for SMEs will typically be a boutique agency, who are an SME themselves. As a result, they’ll understand the client’s challenges and be able to offer a value-led, high-quality service tailored to them.
If you’ve enjoyed this article, don’t forget to read the rest of the Q&As in our Business Basics series. You can do so using the following links:
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