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Hiring right

By Frank Hurtte

Everybody’s thinking it and I believe they’re right. It’s getting harder to find good people. A few souls wax politic and angrily point fingers toward both ends of Washington’s Pennsylvania Avenue. A few Boomers blame it on the worthless work ethic of Millennials and their Gen X buddies. One expert explains it away by referring to distribution as a mundane industry with no sex appeal. I disagree. Instead, I believe that the right great employees, like the famous truffles of France, lie just below the surface and await discovery.

To locate this seemingly hidden group of new folks, some distributors have strayed from decades long traditions and turned to taking extraordinary measures. Companies that used to rely purely on word of mouth and networking have turned to outside recruiters. Some in our industry have upped the ante on what they’re willing to pay for the right person, offering bounties to associates and suppliers for names of potential prospects. Signing bonuses have become more common place than prior to the last recession.

On the topic of compensation, it should be noted that qualified people really are going for more. Case in point, an article on engineering graduates appearing in the Iowa City Press Citizen stated, “Of those graduating, 98 percent leave school with jobs that have a median starting salary of more than $60,000.” Because a good many distributors employ degreed engineers in customer-facing roles, this generates a starting salary squeeze. But engineers are only a portion of the story. In general, the seeming scarcity of good people has created a competition for good folks across all sectors of our employment needs.

Finding and recruiting people with the “right stuff” has become one of the critical skills of industrial distributor management. With this in mind, let’s delve into some of the fine points of getting the right people on board.

Continuous recruiting
Many distributors make the mistake of only looking for people when they have an opening. This might have worked in the past, but in today’s environment, it impacts our ability to react quickly. Constant scouting for and identification of potential new hires speeds the process. Identifying “farm league” industries with a reputation for focused training around customer service or sales process becomes an asset.

For example, one manager makes it a point to build a relationship with new personal bankers each time he reviews his bank accounts. Observing the problem-solving techniques and ongoing attitudes of this freshly graduated and often under employed group has become one of his company’s alternative search practices. A Texas-based distributor discovered Enterprise Rent-a-Car is a fountainhead of sharp young employees with a bent for tackling customer issues. She finds an excuse to rent a car about once each quarter. The rental agents dealing with her think they’re renting her a car. In reality, the interview process has already begun.

In both cases, the distributor creates a relationship well ahead of the actual vacancy. A cache of potential candidates is created and nurtured till the time of harvest.

Obviously, these people are not versed in products but these distributors find technology training more straightforward than customer handling aptitude. We’ll talk about product training later, but for now let’s review the thoughts of growing your own versus stealing from competitors.

Recruiting from the competitors
Talking about this topic is both taboo and time honored in our industry. I would have to wonder if the practice really brings the “dreamy” results some people imagine. Experience dictates that many recruits actually disappoint their new employers. Promises of large customer followings and instant sales results fall unmet. Unless particular care is exercised, people recruited from competitive organizations bring along years of bad habits, potentially unwanted supplier issues and potential legal issues.

Across the industry, more companies are instituting both non-compete and non-disclosure agreements. The merits of non-compete agreements can be argued, but they do add a degree of complexity and risk to the whole process of recruiting from competitors. The enforceability of these contracts varies by state, but wandering into a non-compete without some legal guidance is dangerous for both the new hire and the company.

On the surface, non-disclosure agreements don’t seem all that noxious. However, most courts hold everyday things like customer names, contact titles, supplier relationships and simple marketing data in the same trade secret category as pricing structures. It’s often tempting for an “exiting” employee to download his contact list and a few electronic catalogs. Bringing any information into your organization opens you to time-consuming litigation and worry. In a world of laptops, tablets, smart phones and all the rest, it’s a good idea to build a buffer between your company and the potential spillover of “competitive information.”

When thinking about a person who is currently working for a competitor, it’s doubly important to make certain you understand the quality and extent of their work. Sometimes, you know them up close and personal because of a long history of competition, other times you lack substantial information. Checking references is tricky, but checking up on their past is still important.

The modern art of reference checking
There is no straight forward reference check. Call any past employer and you are likely to hear the following, “Yes, Frank worked here from 2005 till 2013, have a great day. Goodbye. Period.” HR departments and company legal counsel has hammered this practice into the fabric of companies large and small. While most potential hires will hand over a half-dozen people willing to vouch for them, I wonder about the believability.

Today, a lot of information about a person comes by way of the Internet. Here is a new axiom: proceed to interview no one before investing 15 minutes to a Google search. In the past few months, I have seen a quick search turn up a string of drunken driving offenses, a felony arrest, charges of sexual impropriety and a lengthy four-letter infested rant about a fellow employee.

Once through the initial search, we like to check the candidate’s contacts on LinkedIn.com. Very commonly, we discover contacts in common. Often, mutual contacts are willing to provide details around the candidate’s performance, strengths and weaknesses. Preparing a few questions ahead of time is appropriate. Never ask if a person should be hired. Instead, speak as if you just want to get the potential candidate into the best fitting role in your organization. Human compassion acts in strange and mysterious ways. Everyone wants their friend to be hired, and conversely, most want them in a position where they will prosper. Asking the question properly is very important.

What happens if you discover no work history, no presence on LinkedIn (or other professional sites), and no other visible records? After dozens of articles, recommendations and tutorials on the power of social networking for the professional, one must wonder if the potential employee without an “Internet trail” is either ultra-private or hiding something. I would ask hard questions to determine the answer.

Personality profiling
Still wondering how that new person will fit into your organization? Personality profiles will give you one additional perspective. While the marketing literature for some testing services claim to give you the end-all answer on hiring matches, we feel the profiles provide areas to explore during the interview process.

Personality profiles raise questions around things like mechanical aptitudes, natural ability to work with distractions, willingness to stick to tasks and a number of
other areas. These become exploration points which create more meaningful interviews.

Interviewing process
Review of hundreds of interviews with potential employees uncovers one amazing point. A good many interviewers spend more time selling their company to the potential hire than exploring issues around the prospective employee. To avoid this pitfall, a well-planned interviewing process is in order. Here is a simple system that works.
Group interviews get better results. The group is broken into multiple stages.

• The screening interview – This is the interview that determines if the person is a close approximation to the job and is typically done via the phone. The interview is general and separates those who clearly do not meet the candidate objectives from the better candidates.
• The host interviewer – This person sets the stage by welcoming the prospect into the organization, laying out the process, answering questions about the position and determining potential strengths and weaknesses of the candidate. Before passing the prospective employee on to the next level of interview, the host interviewer passes topics for further exploration onto the deep- dive interview team.
• Deep-dive interview - This is best done by a team of two employees. The purpose here is to further explore any issues arising during the host interviewer meeting. Use of a team allows one person to ask questions while the second observes body language and other reactions from the question. In instances where questions are “skirted,” the second person asks for deeper explanation. At the end of this time, the deep-dive team passes along any areas which were not satisfactorily answered for one additional pass.
• The wrap-up interview – Typically handled by the host interviewer, this is the last opportunity to probe for better understanding of previous issues. Sometimes it pays to say something like, “The other folks didn’t feel like you were straightforward in your response to why you left Acme Supply. Is there anything more you can share with me to help them better understand?”
• The groups meeting – Following the interview, both groups gather to determine if the prospective employee should be pursued.

Often the prospect is not a match for the job, but may better fit with some other position in the future. This becomes a situation for the continuous recruiting described earlier.

A few parting thoughts
Technical skills are often a stumbling block for prospective employees in our industry. Reports from the field indicate that technical skills are easier to train for than people-based skills. An aggressive employee who cares about results will perform better than a techno-savvy guy with the wrong attitude.

Developing a measurable technical training process for new employees drives success. Most distributors don’t invest the proper effort in specifying what product and application knowledge is most important early on. When left entirely to the new employee, the time to ramp up leads to frustration for the employee and management team alike. We have a couple of technical on-boarding examples free for the asking; just shoot us an email.

Finally, remember this old adage: “Slow to hire and fast to fire.” Even the best companies make hiring errors. If the new employee isn’t on track after six months, they may never have “the right stuff.” This brings us to a bit of news from the high-tech world. It seems both Amazon and online clothier Zappos have a program called “Pay to Quit” where they offer mismatched employees a bonus to leave. These top-performing companies may be onto something.

Frank Hurtte, founding partner of River Heights Consulting, writes, speaks and consults on the issues facing distributors and their supply partners. Contact Frank at River Heights Consulting via email at frank@riverheightsconsulting.com or via phone at (563) 514-1104.

This article originally appeared in the May/June 2014 issue of Industrial Supply magazine. Copyright 2014, Direct Business Media.

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