It is said that in small companies it’s easier to get things done such as streamlining recruitment and avoiding bureaucracy. In larger companies this is much harder. Things tend to move slower and have more doors, barriers, red tape and political obstacles to avoid. But is this avoidable? Do companies make it harder for themselves then it needs to be?
Hearts and Minds
If you are reading this finding yourself in a company where bureaucracy is an issue and you or someone you know has tried changing hearts and minds this will ring true. In my opinion companies make barriers for themselves when it comes to recruiting and it takes more than winning hearts and minds to change that.
Typical problems companies face when growing
The words Organisation, Communication, Politics, Inconsistency and Cash Flow come to mind. Any company will have issues to varying degrees with these words as a result of growth over time.
You need to make sure that everybody is doing what they should be doing in different departments in order to achieve objectives. For this to be the case you need to be ultra-organised and make sure everyone else is ultra-organised. But if one part of the chain isn’t organised it can have rippling effects. The more people are involved, the more difficult it is to be organised.
Talking within a room of 5 people makes communication simple. But when trying to communicate and have a running dialogue across teams, offices, countries and departments it becomes very easy for information to slip through the net. Even systems like SAP have the flaw that it still relies on humans to add external data.
Any business leader who claims politics do not exist in their company is either a liar, delusional or naïve. It happens. People talk. Accept it. But when people start making decisions with politics being a deciding factor and not those of the companies’ best interests, real problems follow.
In a small room with a few people monitoring what each person is doing to assess consistency is achievable. It is a much more challenging task with 10 people plus. If you have hundreds of people, managers and supervisors it becomes a nightmare. If micromanagement comes in to solve the problem it leads to politics, which leads to communication break downs, which lead to organisational problems.
All of the above will affect cash flow. This is especially the case when a company tries to grow. You need cash flow to invest. A big investment in a company’s growth is headcount. But if these issues lead to being ineffective when hiring quality staff, it causes all sorts of problems.
What is streamlining…really?
Business consultants love to talk about streamlining as do new CEO’s and business Guru’s. Streamlining is what it says it is. It’s stripping away obstacles and barriers to ensure things flow easier.
How do you implement streamlining?
The easiest way to streamline is to keep it simple and work from the top down. Ex Nucor (A US Steel company) CEO Ken Iverson ensured that Nucor only had 5 levels of hierarchy within the business from CEO to shop floor. This may not work for some companies, but how many companies have too much hierarchy and people in unnecessary positions. Berkshire Hathaway (Warren Buffett’s multi-billion-dollar investment holdings company) which oversees the operations of a number of unrelated companies and investment portfolios has less than 20 staff. I’m not saying strip away all of your staff and fire the board, but what roles are needed and what can be automated, outsourced or handled elsewhere? Think organisation and the benefits to it.
The communication angle
The problem everyone tries to answer is how do we improve our communication within the company. The question should be how do we empower people to be able to make correct decisions without having to communicate everything in the company. The point being how many companies insist on everything being communicated. The compliance department ends up having tons of people rather than the individual line managers across the company being properly trained and accountable for compliance. You don’t need to communicate everything. It’s just micromanagement on a huge scale. Shrink down to what NEEDS to be communicated and EMPOWER the rest with ACCOUNTABILITY.
How do you avoid politics?
You can’t. It happens. So, accept it. But politics can be eased and maintained to minimise its negative impact. Politics consists of either people moaning behind closed doors about superiors and colleagues or people brown nosing their way up the career ladder. Often superiors have done a bad job and have criticism coming. What support, training and motivation can you offer those superiors to ensure they do a better job.
Forget senior appointments and newcomers being the hardest jobs in a company. The hardest jobs are middle management. If you do everything you can to improve middle management and get that bit right, it eases problems above and below it. Below middle management, people have effective leadership and accomplished management to guide them. Above it you have well trained, capable people coming through. Although not full proof this really does improve things. But try finding a book on navigating middle management. Good luck with that.
Poor KPI management and understanding is key here, but so are the people responsible for managing performance. Many companies operate a monthly or quarterly KPI based system. The problem with a set time period focused on KPI’s is that if people are short on KPI’s their motivation evaporates. If they are over on KPI’s they could be tempted to roll a few results over to the next period. KPI’s should be about analysing problems and finding solutions from the patterns they reveal. They should not be about motivation and careers. Again, managers should be focused on building consistent performance and using KPI’s to aid this, not short-term wins. Too many companies get lost in the detail and lose sight of the bigger picture.
Cash Flow Improvement
Businesses get too focused on profit or turnover. It’s cash flow you need to worry about when growing. Bad month? You can fall back on cash flow. Want to hire more staff? If you’ve got a good cash flow, then you can. Unexpected costs? Great. You have emergency money to cover that.
Profit should be put in the cash flow pot, not spent on unnecessary benefits and lavish parties. Expenditure should be limited to what’s needed and what has a direct or calculable indirect benefit. Splashing cash on nonsense is wastage.
How does all this tie into Recruitment?
There is a pattern that emerges that correlates between how a company is run and how effective its recruitment is.
If you want recruitment to be effective it has to be organised and agile. You cannot have it where top talent is introduced, and it takes 6 weeks and 3 stages of interview to get to an offer. The quickest way to lose talent before you have it is to procrastinate. The hiring manager gets the CV quickly and is accountable for issuing feedback quickly. That feedback doesn’t need to be anything more than a no because of reason a, b and c. And if interested to interview then dates/times and 3 options on these should be presented. No hanging around. High urgency. You shouldn’t need 5 people to meet them. 2 stages and a concise relevant process will identify talent. But urgency and the organisation to facilitate urgency is key.
There should be no more than three people involved with the recruiter being the go between for the candidate and the hiring manager, which are the other two. HR, other managers, department heads etc can stay out of it. The more people involved the more that communication becomes a problem. Keep it simple, to the point and again urgent.
People have favourites, but how many companies have I come across where their internal recruitment process has changed and suddenly a new person is handling recruitment. Whereas before I filled all the roles quickly, reliably and cost efficiently dealing with the hiring manager, now things change. Suddenly someone else comes in and wants to use their favourites. The next thing you know it has a negative impact on their recruitment, but politics mean that favouritism takes precedence over the companies’ best interests and the objective. Get a good recruiter, have an open working relationship and stick to objectives.
Using 30 agencies is desperate and leads to inconsistency. Any good recruiter wants committed clients, not chancers. Have a process, stick to it and try to improve it by simplifying things, not trying to be clever by adding barriers. Keep things simple if you want consistency. Complication leads to inconsistency.
Recruitment Cash Flow
If you want the best people you should have the cash flow to recruit when Top Talent is available not when you are available. Keep cash aside for recruitment. Don’t have an immediate role for them now? OK, but you’ve got a team of HR, Compliance and several people in senior management taking meetings all day rather than doing anything? Do you need all those people? Would this person add more value? Can you ensure that you always have it where you mobilise roles because you have an agile structure? Can you afford to take a small hit on paying wastage short term wages for huge long-term benefit by hiring talent before you need them? Agility is created by cash flow and you need to be agile.
Recruitment is key to growth. Without it you cannot grow. So, make it a streamlined process. Don’t add barriers and bureaucracy. Generally streamlined companies, who ensure staff are trained well and given autonomy are far more able to grow. But simplicity, objectivity and agility are what underpins all of that.
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