In this article, we will discuss the 6th Primary Internal Practice every company must have to achieve 9 Figure Success. This Primary Internal Practice in Human Resources.
The majority of small companies do not understand the incredible value of a Human Resources department and how this value helps a small company grow. In most cases, small companies think that Human Resources is all about hiring and firing employees. However, the facts are that a well-structured Human Resources department does and will make an extremely positive impact on your company in ways that the majority of small business owners never think of or realize are possible.
There are many facets to a good Human Resources department. Yes, they recruit candidates for all positions in your company. Then they screen the candidates and do the initial interview. Assuming they feel the candidate has the credentials for the position that they are filling, they then do a background check and depending on the level of responsibility the candidate will have in this position they may do a deep dive. Background checks and credit checks need to be considered based on the level of responsibility the candidate will have in the company and more importantly any issues found need to be discussed directly with the prospect before judging them.
I wish I could say I have never made a mistake in my career and life. However, that would not be true. Fortunately, I also know many very successful people who have also made mistakes with the best of intentions, but sometimes crap happens and a good intention goes bad. We have seen extenuating circumstances create a less than stellar report and upon conducting thorough due diligence, find that the candidate is a victim of identity theft and other extenuating circumstances that often result in an employee that works extra hard to prove themselves.
When we are recruiting new people, depending on the level of responsibility they will have, we use three outside online tests to better understand how they work and how well they will work with other members in their department or other management team members. We have found when you build a team that will naturally work in harmony with each other, results and productivity continually grow.
In addition to this responsibility a great Human Resources department will also communicate with every employee in the company and build positive relationships with them. This opens Human Resources understanding of any problems that may be evolving in the company and allow it to help manage the potential problem by working with the President and possibly a department head.
This also leads to learning when an employee feels they may need or want training to either do better work or help position themselves for a promotion in the company when an opportunity arises. We have found growing from within the company inspires more team members to work harder, support each other more and request advancement.
Just remember, growing from within is a process that benefits the company and lowers employee turnover; however, 9 Figure Company rapid growth also requires you to recruit from outside the company. Here is an example, one company I founded I prepared well before launching and in the first 8 months we hired One Hundred Thirty-Two (132) new team members. I could never have accomplished this without a great Human Resources team.
Human Resources also manages your whole benefits programs and works diligently to get your company the best benefits possible at the lowest cost. This includes Workers Comp and the training programs your employees need to complete to help keep this overhead low.
We hope everyone reading this is passionate about scaling their company and if you are, make certain you do long term thorough due diligence on PEO’s or Professional Employer Organizations. For a company that has no intention of growing beyond fifty (50) employees, it may be a good service.
For companies planning to grow to 9 Figures and larger, using our coaching guidance, you will have over four-hundred (400) employees and likely a lot more. You will be far better off not using a PEO and having your HR department manage everything in house.
We advise all our clients that you create the greatest wealth and highest valuations, when your company owns and controls everything your business uses. Small companies may benefit outsourcing a variety of services, but they seldom attract the highest qualified executives, because they know how expensive outsourced services are and the limitations your company is under when you use these services.
Until next time …