Latest / Best of Business / Phil Wicks: Small Business NZ Founder on the cost of businesses hiring the wrong staff

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Phil Wicks: Small Business NZ Founder on the cost of businesses hiring the wrong staff · Best of Business

• 0:09
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• 0:16
  Speaker 2: The wrong hire could come at a big price tag
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  Speaker 2: for small businesses. Seek reckons. It's costing Kiwi SMEs over
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  Speaker 2: nine hundred million dollars a year, so for an individual business,
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  Speaker 2: that's about twenty thousand dollars. Phil Wicks is the director
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  Speaker 2: of BSP Advisory and Small Business New Zealand founder. Thank
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  Speaker 2: you so much for your time, Phil.
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  Speaker 3: Good morning, good morning, good morning. How are you good?
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  Speaker 2: Thanks? Hey, how do you know? How quickly do you know?
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  Speaker 2: Maybe when you've made a bad hire?
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  Speaker 3: It normally doesn't take that long. Sometimes it can be,
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  Speaker 3: especially if it's an attitude thing, but generally most businesses
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  Speaker 3: will know, most business owners will know reasonably reasonably quick.
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  Speaker 3: So I've done something wrong here.
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  Speaker 2: So where do the costs come into play when you've
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  Speaker 2: made a bad hire?
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  Speaker 3: There's going to be things, some obvious things like wages
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  Speaker 3: and training and loss, productivity and fixing mistakes possibly, but
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  Speaker 3: there are also some hidden costs the owner's time, stress
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  Speaker 3: on other staff, sometimes morale, missed opportunities, potentially unhappy customers.
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  Speaker 3: So yeah, it is look it's a big it is
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  Speaker 3: a problem. There's things that owners can do probably better
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  Speaker 3: to prevent those problems, but once it happens, it can
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  Speaker 3: be quite a long road to correct. The mistake is.
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  Speaker 2: The quality of applicants getting worse, not.
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  Speaker 3: That wrong, it's definitely I experienced this a lot. It
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  Speaker 3: is definitely getting hard, especially in the trades to find
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  Speaker 3: the right people. And often with businesses there are under
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  Speaker 3: a lot of pressure to find people quickly, and you
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  Speaker 3: know they have work waiting. They feel that they cannot
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  Speaker 3: afford to leave the role empty. But the danger isn't
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  Speaker 3: trying to solve today's staffing problem, they actually create a
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  Speaker 3: bigger problem for the next six to twelve months potentially.
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  Speaker 2: Because Phil, we're hearing from people who are looking for
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  Speaker 2: work that there are just so many applicants for each job.
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  Speaker 2: I wonder whether that's a little overwhelming for an employer
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  Speaker 2: who might not, as you say, have the time to
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  Speaker 2: go through and make a good selection.
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  Speaker 3: Well, sometimes it depends a lot of It depends on
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  Speaker 3: the role that's been advertised. So there will be certain
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  Speaker 3: roles where there are a lot of applicants, but there'll
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  Speaker 3: be other roles, you know, Like I was talking to
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  Speaker 3: a plumber just yesterday morning, and he was the first
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  Speaker 3: thing I did when I see him. I saw him
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  Speaker 3: which he said, look, I've had this ad going for
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  Speaker 3: ages and I'm just trying to find it really hard
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  Speaker 3: to get any response to it. And it was a
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  Speaker 3: good position. He's offering a sign on bonus as well,
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  Speaker 3: but he just wasn't getting sort of he wasn't sort
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  Speaker 3: of getting any sort of response. So it's a bit
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  Speaker 3: of a it's a bit of a mixed bag. But
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  Speaker 3: in general, like I said, with the trades, it generally
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  Speaker 3: isn't that easy to find the right people for the
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  Speaker 3: right position. And that's where the mistakes mistakes happen, is
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  Speaker 3: that desperation takes business owners away from the correct process
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  Speaker 3: that they should be using.
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  Speaker 2: Are there any red flags that employers are missing that
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  Speaker 2: they should watch out for.
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  Speaker 3: I think I think, Like I said, I think the
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  Speaker 3: thing is that they they through that desperation, they stopped
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  Speaker 3: doing what should be a correct process. Firstly, understanding exactly
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  Speaker 3: what the job is that's required, you know, what the
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  Speaker 3: skills are there that are essential, making sure that they're
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  Speaker 3: writing even just writing a correct job description and an
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  Speaker 3: advert for the position, and not just doing something generic.
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  Speaker 3: Probably one of the biggest mistakes is not checking references
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  Speaker 3: and referees properly and asking the specific questions. And you know,
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  Speaker 3: I see that happen a lot, and and you know
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  Speaker 3: they're just it's a process that where they need to
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  Speaker 3: be patient because you know, our vacancy is expensive, but
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  Speaker 3: the wrong person is often more expensive.
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  Speaker 2: Absolutely, Phil, thank you so much for your time this morning.
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