Based on the recent study, Striving for Growth, conducted by First West Capital, 17% of business owners identify employee acquisition and/or retention as one of the main causes holding their business back.
Finding and keeping the right employee can be challenging. Entrepreneurs have many competing priorities and staff turnover can really throw a wrench into a business growth strategy.
Here we examine employee acquisition and retention from an entrepreneur’s perspective. James Jackson, a recruitment specialist from First West Credit Union, provides advice and steps to follow when sourcing out a new hire. The team at First West Capital describes the importance of company culture, employee engagement and competitive advantage when building a strong retention strategy. And the team at California Innovations, a First West Capital client, share about their own company’s journey in formulating a strong corporate culture and how that has affected their own acquisition and retention efforts.
Learn how to tackle this pain point for business owners from experts in hiring right and retaining well.
Employee acquisition
The dynamics are ever-changing in the work space; baby-boomers are retiring, and more millennials are seeking employment opportunities. Business owners from Striving for Growth expressed that they struggle to find reliable and experienced people. How can you ensure you sourcing out the right employee?
Since starting his career with First West in 2017, James Jackson has helped to hire over 150 new employees. His key role as Senior Corporate/Executive Recruiter is recruiting various roles within the organization, including senior and leadership positions. By collaborating with existing First West leaders, James sources the right applicant and assists in hiring the perfect fit.
Jackson finds his role fulfilling and loves to see the positive impact a new hire has on both the business and the employee. To see success with employee acquisition, Jackson says you must properly prepare, follow a consistent process and adequately support your new hire.
Preparation and execution
Being properly prepared is an important first step when adding to your team. Develop a hiring strategy and be consistent in following the steps –to avoid mistakes down the road. Part of this strategy may include drafting a wish list or leaning into your personal network as a direct source of talent. Use social media platforms, such as LinkedIn, to create connections, discover talent and identify individuals you want to work for you even before they are needed ; this is also referred to as a talent pipeline. This can alleviate stress, should you have a period of turnover and need to fill a position unexpectedly.
As part of your hiring strategy, being proactive is crucial. Understand what you want before you post a position; you want to ensure this new team member fits and fills any gaps. Jackson recommends drafting a clear and candid job description. Post the opportunity on multiple platforms such as your company’s website, LinkedIn and Facebook. Make sure the posting always links back to your main web page as the applicant should be familiar with your business before applying.
Another key component of your hiring strategy should be identifying and communicating your corporate culture. Corporate culture encompasses your company’s vision, values and behaviors and uses them to guide your practices. It is common for businesses to develop a mission or vision statement reflective of their culture and use it as a driving force to stay competitive in the market.
Include cultural fit as part of your hiring criteria. For a new hire to be a good fit, they need to understand and agree with your company’s why. You want your whole team to share in this vision and passionately execute their contributions to propel your business forward. Think about involving your staff in the decision-making process. Depending on how big your team is, Jackson recommends having the applicants meet with existing team members either face-to-face or via phone. Encourage feedback from your team during this process because sometimes others notice things hidden by your blind spots.
The most important thing to remember is not to rush a decision. Take time to reflect on the process, receive feedback and feel confident in your choice. Once you have hired the right person for the job, have an effective and clear on-boarding process. Set up a training or development plan to assist in the employee’s success from day one and determine their goals – a challenge is good if it is backed with stable support.
Employee retention
Striving for Growth revealed most businesses feel they don’t have enough exposure and employees aren’t focused on growth – ‘they simply have the job to have a job’. Employee retention can be a challenge. Forbes Magazine revealed that 43% of millennials plan to leave their current job within 2 years. It’s important to have a strong retention strategy in place to prevent turnover within your business.
Looking in the mirror first
The first step in employee retention is evaluation. Seek feedback from peers, subject matter experts and external consultants and listen to what they have to say. Be honest with yourself about what your business is doing well and not doing well – it’s okay if you don’t always have the answers. Craft the best questions and seek the answer of the highest quality people.
Following evaluation, discover what it is you have to offer as an employer. What makes your business unique? For example, First West Capital strives to have the discipline of an institution with the heart of an entrepreneur – it is rare that you get a mix of both.
Once you feel that you have something different to offer in the work-space, find ways to offer your employees the ability to provide candid feedback. Host anonymous employee engagement surveys. Not everyone speaks up, so it’s important to encourage them to. As a leader, you’re not a mind reader and you can only fix the problems that you’re aware of.
Be competitive
Staff turnover is expensive. In addition to hindering your growth strategy, it can cost you more than 200% of an employee’s salary to replace them (Forbes Magazine). Your business should stand out and be competitive in the market. People desire purpose and it is important to create a work-space where employees feel motivated and inspired. You want your staff to feel comfortably challenged by their workload and privileged with the benefits they receive when working for you.
Have a good benefits package. The top items for most employees include things such as, a competitive salary, flexible working hours, health coverage and vacation time. Step it up a notch by adding a company gym to the office or convertible stand up desks to add some variety to a work-space. Sometimes it can be simple to have a competitive advantage as an employer.
Keeping a performance-based work environment, where employees feel empowered to produce results. Implement a lofty, but attainable, company goal as a source of inspiration. At First West Capital we refer to it as a BHAG (Big Hairy Audacious Goal). A BHAG is a common goal you share with your team. You can celebrate big wins together and use it to keep everyone grounded and on track.
Host team building activities regularly and remember to celebrate the successes (big or small). Invest your time building relationships with your employees and make career pathing a focus. Encourage employees to build their careers by making lateral moves within the company – this helps increase your retention rate as your employees grow alongside your business.
Above all, hire first for cultural fit and values and second for skills.
Corporate culture from the heart of our client, California Innovations
Meet Mogil Mel, President and CEO of California Innovations, an Ontario-based insulated product design company that has grown to become the world’s leading provider of soft sided coolers and insulated lunch packs. Mel founded the company and has nurtured and contributed to California Innovations’ corporate culture through the years. Mel and the HR team ensure their corporate culture remains an integral part of their recruitment strategy – finding talented people that work well with a casual, supportive and creative team.
Corporate culture contributes to the identity, including brand identity, and values of the company. The corporate culture at California Innovations is described as friendly, supportive and casual – jeans and dogs are often in the office. Their core values include passion, innovation, creativity and inclusiveness and this is reflective of staff from all different levels in the company. There is a consistent push to be better and do better for the customer base; leaders and employees take pride and care in the strong culture they have built over the years. Mel feels that his role is to support talent acquisition efforts and to proudly talk about the different aspects of California Innovation’s culture to the team. He stresses the importance of appreciation and says, “I am very proud of the direction the team has taken our culture and I feel the need to let them know so that they can also be very proud of what they have created.”
Sandi Devlin, Human Resources Director at California Innovations, says that culture holds an equal weight to compensation in people’s decision to join and stay with an organization. She also believes that a strong company culture retains talents when people feel a sense of belonging, which leads to longer-tenured employees, improved employee engagement and productivity, and in turn, better business performance.
At California Innovations 33% of staff have over 10 years of service and 50% have 5 years of service or more. They source talent in a few different ways, such as tapping into networks and referral resources and even participating in co-op and internship programs with local collages and universities, shares Devlin who started with the company as a co-op student herself. “The people that work here know we will support their ambitions and goals,” says Devlin. “We have many success stories of promoting growth from within, including my own, and it has become an important part of our corporate culture.”
A strong team is a key driver behind a healthy growing business. Good leadership is also important as it attracts and retains good people. Mel advises, “Trust and listen to your people. Invest in your people’s growth and learning. Support their goals and their successes. Without great people businesses cannot succeed or achieve what it is set out to. And it isn’t nearly as fun.”
California Innovations and First West Capital
We provided $10M in junior capital to help fuel California Innovation’s growth and expansion strategy.
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