Let’s start with a simple idea:
The smaller the team, the more impact per teammate
Think of a team rowing a boat in a race. The fewer rowers you have, the bigger the share each rower carries in his or her shoulders. If any one rower is feeling ill or weak that day, the bigger the impact on the team will be. What’s more, if any rower is not a team player, and disturbs the ability of the group to function as a unit, the bigger the ‘hit’ to team performance.The same is true in business, of course. Businesses exist to add value. In most businesses today, the total value added by the business is the sum total of the value add contributed by each employee. The smaller the organization, the larger the proportional contribution per person to total value added.Consider a team of one – the extreme case. In this situation, a single contributor is responsible for 100 percent of success, or failure. Compare that to a corporation with 100,000 employees. In this case, neither a strong performer nor a counter-productive employee will have a huge impact on net profit. There are exceptions, of course, since all employees don’t contribute equally. Just think of the sports star who propelled his team to the championship, or the financial trader who committed fraud while betting big, got caught, and brought down the entire company, or the car designer who came up with the mini-van and saved Chrysler. But, unless you’re looking for the kind of luck (good or bad) you need to win the lottery, the rule applies – the smaller the team, the bigger the proportional impact of each member, and the more impactful your hiring decisions will be.
Who is more selective – big or small companies?
So, given that smaller organizations are more susceptible to variations in employee performance than larger ones, which organizations should be more selective when hiring staff? Big or small?Of course, quality of hire matters to companies of any size, but on a case-by-case basis, it follows from the argument above that it matters more to smaller ones. Put another way, a bad hire can hurt any company, but it can wipe out a small one.So, you might expect smaller companies to be more careful, and hence more selective, when hiring. But is this what really happens?Unfortunately, not usually. You might recall a previous article I wrote on your chances of having to take a pre-employment test if you are applying to a large vs a small company. The bigger the company, the greater your chances of being asked to take a test. It’s just a hunch, but I’d bet the same is true for background screening, drug testing, multiple interviews, reference checks, and most other means of selecting a new hire.
So why are bigger companies more selective?
The rationales I’ve heard are that they have more to gain/lose, or that smaller companies to don’t have the time or resources to put these extra selection tools in place. But, I’m not sure either of these arguments apply, at least not anymore.I’ve argued above that smaller companies have more to gain or lose (on the scale of success) by hiring smarter. It’s they who really have the most at stake, at least in terms of meeting their goals and surviving.Second, as it has with everything else, the Internet has removed virtually all the drag previously associated with implementing these tools. Ask yourself when was the last time you needed something that you could not easily find and purchase online? To older guys like me it’s fascinating. Everything you want is just a click away. The same applies to selection tools. Need a test, or a background check, or a reference check – click click, and they are probably free for the first couple of uses, as they are at my company.
The key takeaway
If you’re a small or medium-sized organization, and you are involved with hiring, ask yourself if you are being selective enough. Are you making sure you are getting what you want from each hire? Have you had situations where a bad hire has hurt you? If you agonize about making hiring decisions, you can get help with just a few clicks.The key to making great hires is information. Collect as much information as you can gather before passing judgment. These days, information is literally a click away. For instance, it just takes a few moments to put in place a new testing program.
ASEAMETRICS is an HR Consulting firm established to provide solutions to help companies solve talent-related business problems. They are an expert at providing technology-based solutions to help companies identify, develop, and manage the human resource for business success, today and in the future.
Integrated into the company’s high-impact services are advanced technologies through HR Avatar (for E-Testing), Udemy (for E-Learning and Competency Development), Arbinger (for E-Learning – Mindset Change), Withiii (E-Organizational Development), ESM (E-Strategy Management), and HopeChat VP (E-Psychological Services).