Entrepreneurs and company leaders may want to look at Dave Ramsey’s new book, EntreLeadership as they look for ways to grow their businesses. As the title implies, this book looks at how to blend an entrepreneur’s mindset and an understanding of the mechanics of running a business to lead to greater success.
If you have a business or are contemplating starting one, you most likely fit into the description of an entrepreneur. Most entrepreneurs need to quickly come up with ideas as well as lead an organization to succeed. It takes a combination of the two to keep a business alive and thriving — to Ramsey that’s the art of “EntreLeadership.”
When you consider that small businesses make up the majority of the nation’s employers, it’s important to hire the right talent and keep them motivated. A recent survey by Right Management, a talent and career-management company, confirmed employers are convinced other companies are trying to hire their top talent, a concern that is shared by companies of all sizes.
Proper hiring creates a good team. Turnover has financial costs, but also has indirect costs, such as lost productivity that leads to morale problems. The No. 1 thing that creates team problems is the rush to hire a replacement.
Getting the right people on the bus is an expression used by Jim Collins in his book “Good to Great.” He has an interesting perspective when addressing problem team members. “If you hadn’t hired them yet, would you hire them again?” he asks. The answer to that question supports making interviewing the No. 1 priority when hiring. Ramsey believes the proof is in his employee-turnover rate — just 4 percent a year.
What does he do in his hiring process that is different from most companies? The first step is writing a clear job description using Key Results Areas. KRA’s do not have to be complex. They can be as simple as defining the number of calls and the sales volume required of a sales position. One of the biggest hurdles most employers face is attracting the right talent, and this process starts with the job description. Ramsey uses several KRA’s that communicate in a clear way “what winning looks like on our team,” he says.
After selecting candidates, the next step is the interviewing process. On average, it takes 6-15 interviews over a 90-day time frame to find the right candidate. While the process may seem long and arduous, Ramsey says that’s exactly the time he takes to determine if a person is the right fit for his organization.
He says when he started his business, if someone told him it would take that long to find the right person, he would have found a reason this method wouldn’t work for him. After losing millions of dollars in productivity and lost opportunities, he began to believe that hiring the right person does take time.
The next time you are faced with hiring decisions, try using Ramsey’s process for the next five hires and see what happens. You might be surprised by a low employee-turnover rate and an increase in team member morale.
Job seekers commonly voice frustrations with the lack of communication during the interview process. That’s not the case with Ramsey’s organization. He believes in communicating with the candidate throughout the process letting them know the next steps.
The way you treat a potential member of your team during the interview process speaks volumes to them about the way you would treat them as an employee. Treating people as you would like to be treated often is lost in a market where making fast decisions is honored. But, “the candidate hired properly will perform better and is more likely to stay with the company,” Ramsey says, and this philosophy drives his hiring decisions.
Chaos is unhealthy and breeds failure, and it happens in companies that don’t make communication a priority. That’s why taking the time to communicate and get to know the people you are hiring leads to a solid team.
It could be that after implementing some of Ramsey’s hiring strategies, the concerns employers may have about competition targeting their key contributors might not be an issue.
Overall, “EntreLeadership” offers a great deal of practical information on hiring and developing effective teams. It provides a unique perspective on how to run a business, and if you’re in a job search, it helps to be mindful of what employers look for when building their organizations.
Ramsey makes good use of examples, and with a sense of humor helps drive the point home that people like to be treated as people and not as units of production.
For those who want more about the concepts in “EntreLeadership,” Ramsey offers live EntreLeadership events. Dates and times are available on his website, www.daveramsey.com.
