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Your most important buying decision

October 22, 2014 -  By

What’s the most important buying decision you’ll ever make? No matter what your answer, there’s a proven system that ensures you always get the highest possible return on your investment. This system is used by governments, corporations and startups worldwide for one reason and one reason only: It works.

And, yet, this system is routinely ignored when it comes to making what’s truly the most important buying decision any business owner or manager ever makes: who gets hired.

Best-practice purchasing procedures are also an effective employee hiring system. Maybe it’s time to consider taking a page out of your purchasing manual and start “buying” employees with the same due diligence you apply to every other investment decision.

Spell out specs

You can’t get what you need if you don’t know exactly what you need it to do. Your purchasing specs for a new employee should spell out:

-The mental and physical capacities needed. Do you need a rocket scientist or someone with a GED? Does the applicant need to be able to leap tall buildings or just mow and blow?
-The innate attitudes (responsibility, teamwork, etc.) that ensure the employee likes the job and your customers like the employee. A Harvard Business School study determined that attitude accounts for 93 percent of a person’s success on the job.
-The personality traits best suited to the job. Does the job call for a person who prefers to sit behind a desk or who would rather be outdoors?
-The specific skills you need. Does the ideal candidate need to be an expert at pruning? If yes, design a test to make sure you get what you need.

Solicit interest, evaluate qualifications

In purchasing, an agent issues a solicitation of interest to find out who might provide the required products or services. In hiring, this step is when you advertise your job using every possible resource. Ask for referrals from employees, customers and vendors. Advertise on job boards, on your website, in the local papers or on Craigslist and Facebook.

In the purchasing world, a qualified bidder is: “an entity that has the capability to perform the requirements and the reliability which assure performance.” In the hiring world, you need a few simple steps to minimize disruptive and costly turnover by ensuring better hiring decisions.
First, conduct a telephone prescreen to see if applicants meet your basic criteria (i.e., ability to work the hours needed, reliable transportation, etc.).

Test those who pass the prescreen to see if they meet the requirements called out in your specs. The first tests are for the required physical skills and mental capacities. Once those are verified, standardized attitude and personality tests also are available to identify those people best suited to the job. Or you can build attitude and personality questions into your interview question set.

Issue an RFP, conduct an analysis

Now, the purchasing agent invites qualified vendors to submit their proposals. Similarly, you have identified a group of people you want to invite in for the big test—the interview.

Interviewers who get the best results use structured interview question sets. By asking each applicant the same questions, they’re able to compare apples-to-apples and make the best hiring decisions.

Now our purchasing agent enters all the information from the proposals submitted into a spreadsheet to analyze the data and make a decision. When you make a hiring decision, you have four things to consider and weigh as follows:

-Test results count for 30 percent;
-Interview counts for 30 percent;
-References count for 30 percent (if you’ve thoroughly checked them); and
-Your personal perception counts for 10 percent because you have normal, human biases. These biases are why so many people hire the best applicants instead of the best employees.

When you find good-to-great ratings in all four areas, you’ve found the right person for the job.

Every job applicant knows your job is to “buy” the best applicant you can. Don’t disappoint them. Use purchasing policies and procedures to decide who gets hired and watch your organization prosper.

Mel Kleiman is the founder of Humetrics. He helps companies build high-quality, frontline, hourly workforces. Reach him at mkleiman@humetrics.com.

About the Author:

Mel Kleiman is the author is the founder of Humetrics. He helps companies build high-quality, frontline, hourly workforces. Reach him at mkleiman@humetrics.com.

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