I’ll be the first to admit I made a lot of hiring mistakes in my career. In fact, for me, personnel management in every aspect was probably the most difficult and stressful part of the CEO job. I’d always relish doing the fun stuff like formulating strategies, designing new products, or working on new marketing programs. But I frankly dreaded having to deal with staff performance reviews and issues, compensation decisions, or above all coping with the loss of a key employee.

I know I’m not alone. In discussions with other CEO’s over the years, I have been struck by how many of us struggle with the people side of the business. There are many reasons for this that I won’t get into now. But suffice it to say that your success as a CEO will be greatly determined by your ability to build and maintain a strong team. Here are some things I discovered over the years that you might find useful:

·         Recognize that finding the right people is and always will be an ongoing, high priority CEO responsibility.Depending on the size of your company, you may be hiring all the new employees yourself or only your direct reports. In any case, like it or not, it’s ultimately your responsibility to make sure you have the right people at all levels. And, the bigger your company gets, the more important it becomes. No matter how robust your business model is in theory, without staffing it with the right people you’ll have an empty shell or at least an under-performing business.

·         Hire based on the requirements of your business model.One of my favorite expressions is a paraphrasing of a statement from Alice in Wonderland’s Cheshire cat—“If you don’t know where you’re going, any path will get you there.” You can’t possibly hire the right people until you have decided what business design will enable you to get and sustain a competitive advantage. The requirements of that design (which includes the corporate culture you need to create) will dictate the talents and character traits needed in each key position. An obvious example—if you want your company to be a leader in product design, you obviously will need a world class head of that department.   

·         Hire people with a track record of appropriate accomplishments. Once you know the position(s) you need to fill and the things that the holders of those positions need to accomplish, hire people who have proven, based on past history, that they can accomplish it. Anything else is an expensive crap shoot. “Behavioral interviewing” is an important tool to have in your company’s recruiting toolbox to help find the right person—with not only the knowledge and skills needed to do the job but also the strength of character. If you’re not familiar with this technique, I’d recommend the book Hiring 3.0 by Barry Shamis. Done well, behavioral interviewing will reveal knowledge, skills, initiative, and character and has been proven to be more accurate in predicting success on the job.    

·         Don’t hire until you’ve found the right person. It is all too common to hire the best of the people you’ve interviewed rather than a person who can really do the job long term. Typically, you’re under pressure to fill a vacant position that’s causing you and your company a lot of pain until filled. Succumbing to this pressure is how a lot of hiring mistakes happen. In picking key employees or marriage partners it’s always better to wait for Ms. or Mr. Right to come along.   

·         Monitor the satisfaction of “stars” at all levels in the organization. Every company has critical employees in key positions. Make sure you know who the “stars” are and set up a process that minimizes the possibility of being blind-sided by having one of them move on unexpectedly. You can do this via regularly scheduled direct or skip-level 1:1’s or periodic informal discussions.

·         No matter how good you are at recruiting and retaining, you’ll make some hiring mistakes and you’ll lose some good people. While you certainly can and should do everything you can to minimize mistakes, you’ll never totally eliminate them. It’s just too difficult a process to always get right. 

·         Correct hiring mistakes quickly. When you have the wrong person in a key position, it is costly in multiple ways. It diminishes your company’s performance. It eats up your time. It demoralizes other employees. Fight the tendency to put it off because it’s too painful to make a change or you think you’re being too critical. The quicker you correct the situation, the better off your company will be. Believe me.

·         The time will come when someone who was the right person no longer is. This is a tough one. As your company grows and the world changes, some of your long-term, loyal key employees will no longer be the right people for the jobs they hold. What do you do? The best thing for the employees involved and the company is to take action, not ignore it. In my experience, it’s usually possible to offer them a lower level position that fits their skills and, if communicated properly, they will accept and in fact appreciate it. Most of the time they are well aware they are no longer doing the job.       

A juvenile product manufacturer CEO has a lot of things on his or her plate. None is more important than making sure you have the right people “on the bus”. Among other things, the emotional dynamics of personnel management make it perhaps your most daunting challenge as you go about managing your business. Giving it the attention it deserves will pay dividends.