5 big hiring mistakes we made and how to avoid them

1. Hiring the son of one of our best friends

When we hired Larry (not his real name, of course), I was well aware that it could create problems with his mom, Colleen, one of our closest friends. I did have the good sense to tell her, if Larry was not doing his job, she would never hear about it from me. I also told Larry that I was not planning on reporting anything about him to his mom.

2. Hiring an employee who hasn't finished college

Since 2008, we have hired a number of administrative personnel in this business and in our other businesses. I quickly figured the hourly rate was much cheaper if the candidate hadn't finished college. Unfortunately, I later discovered, there was a reason they didn't go to college. The college experience is not just about cognitive ability; it is also about working with a team to get a project done, learning analytical skills and how to write reports.

This really became obvious when we hired Denise, a 40-something single mom, who had straight As (sounds good so far). The real problem became the constant emotional meltdowns, the crying at the office and the significant weight loss. At one point she told me she had a problem with depression and had gone off her medication. I began to wonder if she was anorexic.

The men in the office complained that they didn't know how to handle a woman who was crying. This is Minnesota after all and we suck it up here! I think we could have worked through the fact that she was burning through a lot of political capital at the office, if her work product had been accurate and on time.

I really agonized about what to do about her, when I was once again saved from my own mistakes. She gets married and moves away.

Lesson learned: I do wish we could ask employees about their medications before we hire them. I think employment attorneys would frown on that. So we try to get at these issues in the interview process. We are now asking more questions about their previous employment — what they liked and what they didn't — to get more insights into their personality and their baggage.

4. Not doing regular, documented performance reviews

Yes, I know this is crucially important, but we got so busy with client work, that some of the basics fell through the cracks. This became a problem when we hired Jim, an African-American veteran. Obviously I want to support all veterans, but it became apparent that he, too, spent his day surfing the Internet and talking to his girlfriend on his cell, when he wasn't back-biting our COO.

It can be difficult to fire an employee who is in a protected class without the proper documentation. Unfortunately we had nothing. Lots of verbal feedback on how to do a better job, but nothing that would stand up to an unemployment claim.

Lesson learned: Verbal feedbacks need to be documented in a private, written file, and our quarterly performance reports must also be in writing.

5. Not keeping an 'ear' on what's going on with the team

It is difficult for me to manage the team as half my time I am working remotely in Rhode Island, and the other half I am in back-to-back client meetings. I really depend on Peter and Josh to keep a finger on the pulse. When they get busy, it is hard for them to hear what is really going on.

Case in point: We had one team member, Suzy, who came to us as an experienced client service manager. Suzy came in exactly at 8 a.m. and left promptly at 5 p.m. On the surface, it appeared her work was done on time and accurately. What we didn't know was she was only doing the "visible" work — not the behind-the-scenes tasks.

Take entering data into our contact management system regarding a client's employment and income. Might not seem important to a team member, but when we have to sort our clients by employer to invite them to a special event, not having the information becomes a big headache. In fact, it is impossible to do the event because we would have to go through hundreds of client files to discover which ones worked for the employer in question. This one small issue can cost a small firm like ours thousands of dollars in lost revenue.

Suzy decided to leave to open a business with her husband. Only after she left, did the team tell us they called her Teflon Suzy because assigned work tasks just seem to slide off her. In fact, they really disliked Suzy and I had no idea this was the case. The other team members were angry that I hadn't made Suzy do all of her work — when I had no idea she wasn't. I was upset because I can't fix something the team won't tell me about.

Lessons learned: First, I had to make sure all the team got the message: It is not tattling to tell me you have been trying to work things out with another team member but can't seem to break through. We are here to help, but we have to know what the problems are. We can't fix what we don't know about.

We have gone to extra lengths to use our contact management system to review tasks. If they are completed, the software will tell us. If not, it should show up clearly. It is important for our leadership team to be monitoring the team to see if they need help to finish something.

Biggest lesson learned: No surprise — I am no manager. It doesn't bother me to say it. If you are like me and have other talents, then you will need to make sure a top person on your team is a good manager, and then document, document, document!

See also:

So long, solo Part 2

12 best practices for writing small business accounts