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I'll Know It When I See It!

Part 1

by Fred Berni

This is the first of a series of articles on how to interview and select the right franchisees and employees. Learn why you can’t rely on instinct alone.

When someone asks what you're looking for in a franchisee or employee are you guilty of saying 'I'll know it when I see it.'? Do you know someone else that says this?

This happens more often than anyone wants to admit. The trouble is, people that 'know it when they see it' generally don't keep track of how the hiring actually works out. They don't track:

How many past hires lived up to their potential.
How many are ranked as top performers or got promoted.
How many quit or got fired, or should have been fired.

It's human nature to forget about bad decisions while patting yourself on the back for the good ones. With their typical overly positive attitude, entrepreneurs are especially vulnerable to this kind of thinking.

A lot of people think the selection process ends once the person has been hired. It can, if you're not overly concerned with improving your hiring track record. If you want to get better at hiring top performers, you have to look at both your good hires and those that have not worked out as well. A good selection process is a multi-stage process:

The hiring/interview process itself,
Training the new hires and
Validating the hiring decision and training process (we'll explore this in a future issue).

You can't simply 'wing it' and expect to hire a lot of top performers. You might hire a few top performers, but odds are you'll hire a lot of duds for every top performer.

When you figure that the hiring process can cost you a minimum of 6 months of wages, if you have even a 50% turnover (and I don't know any retail business that averages that low of a turnover rate) the cost of hiring the wrong people can add up very quickly.

So you have to ask yourself if it's worth using a 'hit or miss' approach e.g. spending a lot of money on hiring and training to get just a few top performers or is it more cost-effective to use a more formal approach to selection and hire the top performers without using the 'hit and miss' approach?

What is a structured interview?

Often, people mistakenly believe that 'behavioral based' interviews are the only type of 'structured' interview. A behavioral based interview is simply one type of structured interview. Another type of structured interview could be one designed to measure job knowledge.

Even 'personality profiles' or other paper based questionnaires can be considered structured interviews as they ask the same candidate the same questions every time. In a nutshell, a structured interview can consist of a variety of interview types. None of them necessarily 'behavior based' The key to a structured interview is that using one makes you ask every candidate the same questions every single time.

Using a structured interview plus tracking their performance helps you learn what kinds of responses the best franchisees and employees tend to give, and how not-so-good performers tend to answer.

Using a well designed structured interview helps you ask the same questions of all candidates. As a result, you'll be able to predict how well a candidate will perform about 51% of the time. I'll grant that this is not an overly strong accuracy level, but it's a huge improvement over using unstructured interviews which typically have only a 38% accuracy level. For more on using unstructured interviews see www.dynamicperformancesystems.com/Pitfalls-Relying-Unstructured-Interviews

In Part 2 I’ll teach you how to develop your own structured interview.