It’s all too easy for owner managers to ignore the people side of their business when juggling multiple roles. And recruitment businesses are no different, in fact, a successful recruitment business relies on the performance of the team. Here we take a look at 5 challenges recruitment businesses can face in the early years…
1. The hiring process is taken for granted
Whilst recruiters are clearly experts in their field, mistakes are all too common and often the hiring process when doing it for themselves is rushed. Poor job descriptions and a lack of a consistent interview process can mean hiring someone who is less than top notch and creates other HR issues down the line.
Recruiting in the right people from the start is key and having a plan to build a strong management and sales team who are vested in the business will pay dividends in the long run. Because it’s their field of expertise recruitment companies may be more likely to cut corners and take the process for granted. We recommend that you:
- Start with an accurate, clear job description that details exactly what the role entails.
- Create a consistent interview process and stick with it.
- Get more staff members involved in the interview process as the best hiring decisions can be made as a team.
- Ensure the candidate is a good fit for your company culture as well as making sure they have the required skills.
- Having a clear, consistent recruitment process will save money in the long run and will help strengthen any buy out situation.
2. Staff feel under-valued
Once you have built the right team you need to keep them, and keep them motivated! In the early years when cash maybe a little tight don’t forget to reward staff. It’s an industry built on performance; paying correct commission and having clear bonus structures are a fundamental part of recruiters’ earnings so should always be factored into your budget so the business can afford to pay staff what they are owed.
Equally, well-drafted commission and bonus policies that are both attractive to the employee, and sufficient to protect the business are crucial.
3. High employee turnover
Fluctuations in the economy can encourage some employees to explore different job options and it’s common for sales and performance roles to have high staff turnover so assuming you do the first two points well; you will mitigate some of that risk and be well on your way to having a stable team.
However, should you experience high turnover be aware that it could signal an HR problem in your business. Use exit interviews to understand what the employees reason for leaving is. Likewise, if you have under performers in your business then utilise probation periods and have correct disciplinary procedures to tackle any issues quickly and effectively to minimise financial impact on the business.
4. Out of date or non-existent policies and procedures
Every business should have some sort of employee handbook that communicates the work related policies to their staff. All too often in small businesses this is something that can be overlooked to the detriment of the business. Not having clear and consistent company policies in writing that all staff are aware of is just asking for trouble.
Just having a staff handbook isn’t sufficient. The policies should be updated on a regular basis and any changes relayed to all staff members. It’s good practice to get employees to sign an acknowledgement form showing that they have read and understood everything in the handbook.
5. Staff leaving the business and taking clients with them
Do not take this point lightly; this can and does happen in the recruitment industry and it can be financially devastating for a recruitment business. Fortunately, there is a way to protect against this. Ensuring that you have robust restrictive covenants in your employment contracts that protect employers by preventing their previous employees from using the knowledge and information gained at the workplace for the benefit of their new jobs.
It’s also problematic if you suddenly find out that the restrictions in your contracts cannot be imposed, so it’s a really good idea to have them checked (or better) written by employment law experts to ensure they are legally compliant.
At citrusHR we specialise in helping small businesses with their HR processes and policies. So if you need some HR advice feel free to get in touch with one of our qualified HR consultants on 0333 444 0165 or get in touch here.