Key Performance Indicators - Activate Group Inc

The Cost & Impact of Vacant Positions

Payroll is typically one of the largest costs in most companies, which may cause you to become too focused on individual salaries and myopic when staffing your company. While cost management is important for your business, it may also become a trap causing you to inadvertently develop leaks in growth and profits.

Do you give enough consideration to how hiring the right people can bring value and help you grow your business?

Imagine your business as a sports team. If we tried to match your team against the competition player by player, position by position, how ready is your organization to compete? Do you think the key performance indicators you require from each of your positions are lofty enough? How does it affect the team when one of the positions is not filled properly because the owner is trying to keep payroll down? How does it affect the team when a player has to leave their “real” position to make up for the absence or inadequacy of another player? How well can a team that has only filled some of its positions compete against another team that has filled all of its positions? What happens when one player has to play too many minutes or has too many positions to cover?

Invest In Growing Your Team

One of our clients increased revenue by 70% in nine months by identifying where they had unfilled and underinvested in positions. The company was growing and profitable but could not turn profits into cash fast enough. Had they continued with inadequate staffing, they might have gone insolvent. Instead, they invested in growing their team and found that for every $1 they spent in upgrading their team, their return was more than $10.

Discovering Vacant Positions

Here are some questions that can help you determine and discover if there are vacant positions in your company:

What key performance indicators do you use to measure high performance for each position/role/function?
Is anyone person accountable for too many key roles in the organization?
Is there any key role or function that has no one person accountable?
Is there any role that is not functioning well?

If you are interested in addressing your “profit leaks,” let’s schedule a time with our business coach to further discuss your business and how we might work together to patch up your leaky bucket. For a FREE consultation, please contact us today or give us a call at 305.722.7213.

Hiring the right employees for your business can be a challenge. Most of my clients in Miami and Fort Lauderdale were adamant that they have excellent recruiting processes. The people they hired went through rigorous interviews, had great backgrounds, and should be performing at expected levels. However, the key performance indicators were telling a different story.

Underperforming Employees

Dismissing the usual answer — “the employee must have lied during their interview” — we dug deeper and asked these key questions:

Are expectations clear?
Are expectations realistic?
Is management sending mixed messages?
Does the person have the tools to do their job well?
Is the organization creating any barriers preventing them from doing their job well?

Hiring the Right People for the Wrong Jobs

After asking all the key questions, management realized they were hiring the right employees, but for the wrong jobs. The people they hired were a good fit for their core values and were well-credentialed. They just were not what these companies needed in order to produce the required outcomes for the jobs at hand. We see this all the time!

Management does not spend enough time really understanding the true attributes needed in the person to successfully fill the position. When attempting to hire the right people, there are many considerations in terms of experience, skills, talent, behavioral profile, and values needed to fill the role. In most cases, management fails to think this through before they hire the employee. Sometimes ,they go through the work of identifying what is needed and then fail to be patient in looking for candidates that completely fill those requirements. The result is a wrong hire.

Employee Recruitment Process

If you want to increase your success with hiring the right employees, it is imperative that you answer these questions before beginning your recruiting process. Make sure that everyone involved in the selection process knows the answers to these questions, and measure your hiring decisions against how well the candidates match the criteria. For those of you reading this and saying that you’ll take attitude over credentials any day, I say you better get both.

Key Questions for the Employee Hiring Process:

Ensuring You Hire the Right Employees for the Right Job

What is the title of the position?
What is the brief description of the position? In other words, what would not happen in this company if this position did not exist?
What are the 3 to 5 most important measurable and specific goals/objectives this person will be held accountable to achieve?
Who are the customers/clients that this position serves, and how do those customers/clients measure service?
What key processes does this position own, and how do you measure that the process is working properly?
What other key/critical processes are associated with the position, and how do you measure that the person in this position is doing their part well?
Does the position have any certification and/or licensing requirements?
What is the position responsible for and what is it accountable for?
Who has input in this person’s performance review, determines their compensation/raises, and is responsible to help them develop?
What do you see as the biggest challenges to success in this position and what steps must be taken to address them?
What are the minimum qualifications for the position in terms of education, functional experience, and industry experience?
What specific industry knowledge does this person need to have?
What capabilities must the applicant be proficient in or excel at to be successful?
What would you say are the critical obstacles for those filling the position, and what are the steps that must be taken to address them.
Describe the ideal person for this position in terms of how they address new decisions/challenges, interact with people, deal with pace in the environment, and approach rules and procedures?
How many subordinates does the position have? Describe the relationship this position has with it subordinates (e.g. can they hire and fire people?)

Results of Creating Proper Job Positions

Our clients have found their hiring success has improved dramatically once they have made a proper commitment to job design and position profiling. Only after you answer these questions should you begin your recruiting processes. The answers to these questions will help you have a much better mental picture of the ideal person. Without this information it becomes hard to screen out candidates as the ideal person is too vague.

An executive and business coach can provide you with practical business processes and solutions to accelerate your business growth. Call to learn how to improve your growth potential by contacting Activate Group Inc. at 305.722.7213.

Tag: Key Performance Indicators

Profit Leak 4 – Are Vacant Positions Affecting Business Performance?