This month, based on material from Chapter Seven in our new book Finding The Right Path: A Guide To Leading And Managing A Title Insurance Company, we review the important topic of hiring new employees.
During the last years, title companies and businesses in general, have let a significant number of employees go. Now, there are positive signs the housing market is starting to improve, although the stability and pace of progress is still uncertain. Most economists agree the country is slowly coming out of recession and the trend will continue into 2013 and beyond. These positive signs mean hiring new employees will be a priority for many companies in the coming months.
Hiring for the future will be more important than ever for title companies because many of the employees who were retained were hired for a different set of skills than those needed today. More often than not, a prior employee was hired because the company had a long-standing opening and work was not being done. In this situation, it is natural to hire the first person who comes along with any technical knowledge, because he/she will have to jump in the job with little or no training. Good technical knowledge is certainly important but what if the person lacks some critical knowledge or is not a good fit with the “Culture” of your company?
Work culture means, “The way things are done around here.” It includes the mix of people you have at work, the number of women and men, race and ethnic identification, along with other demographics like the number of young and old, experienced and inexperienced workers. Company culture also is heavily influenced by the vision, values, and goals of your company / owner, the way work is performed, and how employees work as a team.
We know of an independent title agent who recently hired a new manager who came from a corporate underwriter. Although the new manager had very good experience and a strong technical background, most of his peers in his new company, and the CEO, realized within a few months that the fit was not right. The agent was looking for someone who would be entrepreneurial in his thinking and look outside of the box for new opportunities. What the agent got was a person expected to be told what to do and who only looked on the cost side of the equation. Worst of all, he was not a team player.
Estimates are that a wrong hire will cost a company up to 3 times their salary for each year the person is at work. Having had friends who have recently gone through the process of seeking new employment, we know the landscape for hiring practices has changed dramatically in the last several years. For example, on-line applications and screening processes are now common for larger companies. However, for the smaller agent and most title agencies in general, a few simple steps or rules are important to consider when hiring a new employee:
- Values. Know who you are as a company. This means for example, it is clear what values the applicant needs to align with yours.
- Write a job description. Be clear on the job skills needed. Write these down. If you do not have a good job description, create one.
- Advertise widely. Do not limit your search to one medium. Try social\business networking like LinkedIn, for example.
- Require a completed job packet before screening. If you do not utilize a section of your website for this, create a manual application packet that prospects have to complete. How complete and thorough an applicant completes this information is a good way to screen applicants. Think of the application as a test.
- Screen applicants. An easy low-tech process to use as a screen is a phone interview. Phone interviews should not be lengthy; their aim is to quickly eliminate non-contenders and make your time more efficient. Use a script to be consistent.
- Interview top candidates using a written interview Guide. Too many people interview with a blank piece of paper and then wing it. A good interviewer has a carefully prepared set of questions to ask, a Guide. The interview Guide eliminates inconsistencies and ensures you ask a standard set of questions during each interview. Look for more detail on this concept on page 108 in Finding The Right Path: A Guide To Leading And Managing A Title Insurance Company.
- Score interviewees. The interview guide also enables you to score each applicant. Thus you have a systematic way to compare applicants.
- Bring back your highest scoring applicants for a second round of interviews. Consider enlisting additional key staff members to take part in the interviews for your finalists.
- Never hire a candidate because you need to fill a hole quickly. In the end it may cost you.
- Hire using a 3-month probationary period. Make sure you explain this to your new hires upfront.
Here is one final idea we like but often do not see in title companies. We recommend creating a job skills sample or test for applicants you bring back for a second round of interviews. This means asking the applicant to perform some aspect of their future work. For example, for an applicant who is interviewing to be a receptionist, ask them to answer several live calls. To set this up, ask a current staff member to first explain a few of the basic phone answering procedures you’re company uses. This person then sits by the applicant and makes observations and provides feedback. The results are not only a sample of the applicant’s performance but also valuable insights about the applicant from another person on your team.
The same work sample idea can be used for any number of positions commonly found in title companies. For example, for an examiner position; have the applicant examine a file. One of your experienced examiners can assist with the work sample. For a closer position, have the applicant prepare settlement figures. One of your experienced closers can assist with the work sample. Finally, for a manager position, have the applicant make a presentation in front of a team or manager group about a topic of their choosing, followed by a Q&A. An experienced manager on your management team can assist with the sample.
You may find this process a little awkward or uncomfortable at first, but remembering how much it will cost you if you end up with a bad hire should ease the pain.
If you would like more information about actions you can take to improve or maintain your company culture, like making good hires, please refer to Chapter Seven, Employee Culture, in our new book Finding The Right Path: A Guide To Leading And Managing A Title Insurance Company. If you would like more information about CBA and how we can help you improve and develop your company, please visit our website www.cbaltd.biz or contact us directly.