It’s quite common for people to be nervous about bringing on their first employee. I know a lot of brokers have either thought about or even tried at various points to bring a person into their business. It’s a scary prospect for many including me.
I remember feeling extremely nervous and anxious as I began thinking about bringing on a PA. At the time, I was thinking, this is a $40,000 decision. That’s a huge amount of money when you are a single person operation. You start worrying about what will happen if you can’t afford to pay them. The last thing I wanted was to bring someone on, have them commit to my business and then have to tell them ‘…sorry, I have to let you go’. On top of the salary, there is the office space, a computer, phone etc. it all adds up. I remember talking with people (anyone who would listen really) to try and get some input into my decision. The question most people would ask is ‘do you really need a PA?’ to which I would invariably answer, ‘…well yes’. The only way for me to be able to grow the business was to free myself up from as many of the administrative tasks as possible to allow me to go out and do what I was far better at - building relationships and marketing the business. As with all small business owners I was doing pretty much everything and I remember being very frustrated with doing all the minutiae of administration working knowing that I every minute I was doing those task was a minute I was not out generating business.
What I quickly realised was that whilst the business continued to rely solely on me, it would only ever get to the size that I could personally manage. In other words, I was the limiting factor for my business’s growth. So, whilst I could easily justify the need for a PA to help me in the business it did not make me any less nervous about committing to the decision. So what helped me?
I sat down one day and started going through the maths. The penny dropped for me when I worked out that it wasn’t a $40,000 decision it was a $10,000 decision. Why? Because I reasoned that I would know within 3 months whether or not the new hire was working out. I also worked out that I could get some government funding which would also help offset about $3000 of the cost, so now it was only a $7,000 decision. At that point I was able to ask myself whether or not I was ready to take a $7,000 risk in order to grow my business.
Whilst on the subject of risk, this is the other major thing I have learned from being in business. There are always risks in running your own business. If you aren’t prepared to take risks then you will never grow. The only thing that changes is the size of the risk involved.
So…….. did the hire work out? I hear you saying? The answer is yes. I set her up with a computer on the other side of the desk to me and we shared one desk phone. The amount of work that she saved me freed me up to go and get more referral relationships established and plan and execute a number of marketing campaigns to generate more enrolments. This increased my cashflow allowing me to hire more people.
Here is how I would do it differently if I was about to hire the first addition to my business:
- Start with a job description - this really only needs to be some bullet points. Ask yourself, what are the key duties that I want this person to do?
- Document a few of your key processes – i.e. this is how we collate everything for a loan file prior to submission. If you create a few processes, you at least have something to show a new person rather than having to try and do all your on the job training verbally.
- Post an add on Seek and let people know on Linked In that you are hiring. If it’s a PA, encourage people to send you referrals for people they know. This may be a great way to further cement a business relationship you may have if they refer you someone who you hire.
- Get someone to complete the interview with you. I have never recruited anyone to Intellitrain based on myself being the only person to interview. I have either conducted a panel interview or had a staged interview process where someone else interviews the candidates separately to me. My aim? – to reduce any person bias I may bring to the table when interviewing.
- As you go through key processes in your business, get your new hire to document them for you. This means you don’t have to try and write up all your business processes and procedures before you hire someone as you simply wont have time. Getting them to shadow you and document how you complete a task means that you get the job done and it increases their learning. Make sure that you review what they have documented and make corrections as needed.
- If they are not working out, don’t take it personally. Finish them up and then replace them quickly. Rip the bandaid off quickly, don’t let the sore fester. It’s better for you and them.
- Remember that you will have to take one step backwards in order to take two steps forward. Be prepared to commit time to properly train your new hire or they will end up doing things the wrong way and causing you lots of extra work. If you train them properly you will have an asset that will put you well on your way to creating a sustainable, profitable business that does not rely solely on you.
Paul Eldridge, Director and CEO of Intelltrain
Paul holds a Master of Business and Technology from the Australian Graduate School of Management at UNSW. He also has a Bachelor of Arts and a Certificate IV in Training & Assessment as well as being an accredited Franklin Covey and DiSC facilitator. Paul is an Associate Fellow of the Australian Institute of Management (AFAIM) and a member of the Australian Institute of Training and Development (AITD). Paul is a founding director and current CEO of Intellitrain where he is responsible for the continuing growth and expansion of the business. Intellitrain is widely respected as a quality provider of training services to the Mortgage Broking Industry. The company has won several awards including Best Industry Service and BRW Fastest 100 companies in Australia (53rd) in 2012. Paul has developed authored Cert IV & Diploma units, training manuals, sales manuals and designed and delivered training programs for such clients as Westpac, LJ Hooker, Ray White, RAMS, AFG and Mortgage Choice to name a few. Paul’s style is engaging and dynamic and he is passionate about helping people to grow and develop themselves and their business. Sometimes controversial, always forthright and passionate, Paul will be sharing via this blog his insights and challenges faced in running an RTO in the Mortgage Broking industry.