Guest blogger, Lindsey Paho, a writer at Professional Intern  is back for another visit.  This month her post focuses on the pros and cons of end of year hiring.

For the small business owner, timing of when to bring on new employees can have a significant impact for the bottom line. While it’s stirring to have the type of growth that necessitates hiring, bringing on a new hire at the wrong time of the year can make for a very costly error. Perhaps the worst time for hiring is at the end of the year when an accumulation of factors stack the deck against the employer who takes on additional workers.

While large companies and corporations have the luxury of paying individuals or firms to keep abreast of business legislation and tax law, the workhorse of the U.S. economy, small—businesses—have to rely on principles and senior management to share the load of keeping up to date with these practices. You may seriously think about tax and intangible benefits, of funding key employee tuition for an online MBA program to accommodate working schedules and business needs of staying current on the latest business matters.

Financial hits

Probably the most obvious, though the most financially-significant reasons to think twice before late-November or December hiring are the issues involving taxes and benefits. You don’t have to be a finance-major to learn about these tips, but a targeted course for decision makers might be a good idea.

Unemployment Taxes

Federal (6.2% of the first $7 thousand) and State (for example, Indiana collects 4.2% of the first $9,500) are collected annually. Hiring someone in November means that you not only pay that amount for that year, but at the turn of the year, you roll over and pay again. That’s a big hit at a time most companies aren’t all that flush with income, save retailers.
401k Enrollment issues
Companies that have 120 or more employees enrolled in a 401k program must be audited. If your company happens to be close but not over that number, holding off hiring that 120th employee until after the first of the year can save your company many thousands of dollars in unnecessary auditing fees.

Production efficiency

While seasonal help for retailers are the exception, most companies experience extraordinary circumstances towards the year’s end. Even bringing on college interns, though little or no costs may be involved, production issues make onboarding at this time less than ideal.

Holiday distractions

Black Friday, company parties – no small cost even at $20-40/employee – and family events can’t help but affect productivity. Waiting until the seasonal distractions pass just makes sense for holding off hiring.
Training support availability
Vacations, retirements and transfers can spike during this time and while this doesn’t mean that the work ends, employees often wear more hats than normal to make things run smoothly. What tends to suffer is the time normally used to conduct detailed onboarding activities, both formal and informal. For a new hire, be they management or someone hired at the end of a final semester, expecting them to correctly understand both the job and the culture is not only bad planning, but it’s not fair to the new employee.

Planning

Input scarcity: One final note about year-end hiring. Whether or not your fiscal year begins in October, July or January, planning for personnel issues should be avoided during the last couple of weeks in November and the whole month of December. For reasons already discussed, those who may have critical input regarding department needs, newly identified qualification concerns or production requirements may not be able to participate as fully as they would at other times of the year.

Knowing these points ahead of time can help the small business owner avoid costly pitfalls associated with end-of-the-year hiring obstacles. Being proactive by building into your business plan the means to have management stay current through education is another point that shouldn’t be lost in the immediacy of steering clear of snags.

Lindsey Paho lives near Chicago. She divides her time among work, writing and family life. She writes on behalf of Colorado Technical University and has a keen interest in small business blogging and social media.

People often tell me I have an eye for talent. Spend a few minutes with members of the Roundpeg crew or any of our alumni, and you will know it is true. Somewhere along the line I learned how to look beyond the resume and even what a person says in an interview, to see what they are capable of.

But hiring right is only half the battle. The other half of the equation is training. You have to train your new employee on how to do their job and how to be a part of your organization.  It is a bit like tuning an instrument.  It doesn’t matter if each individual note is perfect if they don’t sound right together.

Sometimes if you are really lucky, all the pieces fall  into place. If you make great hires and give them enough time there is moment when you realize your team “has it”.  You can hear it as they finish each others sentences and anticipate each others needs. Through laughter, shared humor and subtle teasing you can see they have come to  like, respect and trust each other.  When that happens it is easy to deliver great work to clients. As a team leader, you begin to believe you can do the impossible, with ease.

Over the course of my  career, I have been lucky enough to have experienced those moments of management bliss more than once, so I know,they are possible.  Today, we have a few new faces at Roundpeg.   It is going to take awhile to get acquainted and find our rhythm, but we have the right people in place, so we just need a little time.

The economy is picking up.  I know that, because on a regular basis, I hear from other small business owners they are looking for help; part-time employees, interns, a sales person, or maybe a full time associate.  The conversations always start the same way… I am looking for someone, who do you know?

In a recent blog post, Seth Godin talks about how Francis Ford Coppola and Al Pacino knew each other for years before they filmed the Godfather.  He suggests you should always have a list, always be cultivating relationships incase you need someone.

At Roundpeg we have growth plans this year.  I hope to hire two people by the end of the year. But I am not waiting till I need someone to begin looking around and talking to people. I have interns,  former employees and networking associates on my radar.  And I routinely collect resumes, just in case.

What about you?  Do you have a list?

Hiring good employees is time consuming, and if you are also working against a critical deadline for a client the pressure is on to hire someone, anyone.   In those cases, you may not may the best hiring decision.  So, even if you don’t think you will need anyone soon, start looking around.  Meet people, collect resumes, just in case.  As Seth said:

The worst time to go looking is when you need one, badly.

In the last few weeks we have really enjoyed bringing different voices to the Roudpeg blog.   Today, Heather R. Huhman is a career expert and founder & president of Come Recommended shares her perspective on annual performance reviews.

With the growing number of young professionals you’ll be hiring into your organization, it’s time to take a look at one of the methods of feedback managers typically use to evaluate employees: the annual review.

Some organizations have a formal process with annual performance reviews and keep them on file with HR. Others don’t have an official review process at all. I’ve worked at both types of places. I can honestly say I can go either way with the process—but I also feel that relying on just one official review per year is inadequate.

With any process, you’ll have to look at the pros and cons and decide for yourself:

Pros

• You’re providing ideas for improvement and new goals for the next year
• You’re at least giving feedback once per year

Cons

• Might be looked at by the manager as “procedural” – not much thought put into it
• Could just consist of a piece of paper with no conversation about how to improve
• Hard to pick out each mistake or accomplishment months later

Now that your organization will be hiring on more young professionals, or Millennials, my suggestion is to review as you go instead of waiting for the whole year to go by without feedback. These Gen Y members are just starting their careers and will be constantly learning while working for you. You’ll make it an easier process if you provide feedback for their projects and assignments.

Plus, Generation Y has grown up receiving constant—if not instant—feedback, so they will appreciate your help and guidance for them to become more skilled at their jobs. How does your organization review employees? Is it a formal process, or more informal? I’d love to hear your comments!

Author:

Heather R. Huhman is a career expert and founder & president of Come Recommended, a career and workplace education and consulting firm specializing in young professionals. She is also the author of #ENTRYLEVELtweet: Taking Your Career from Classroom to Cubicle (2010), national entry-level careers columnist for Examiner.com and blogs about career advice at HeatherHuhman.com. Follow her on Twitter at @heatherhuhman.

… or do something else!

As I waited for my flight to Chicago I followed a twitter conversation between @robbyslaughter and @allisonlcarter on whether is was more important for employees to love the company they work for, or love the work they do. Beginning with a blog post in which Robby warned of the dangers of blind loyalty to a company, Allison countered with her assertion that she does work she loves with people she enjoys and who also do good work.

Adding my contribution to the conversation (My Goal: Building a Company which supports people who love what they do) I boarded my flight.

As a seasoned road warrior, I typically enter the “zone” when I fly. Tuning out everything around me, I hope the flight doesn’t suck. This flight was different, because once I boarded the flight I came face to face with Joe, a flight attendant who clearly loves what he does. A retired NYC police officer, he flies because he enjoys it.

Delivering service with a smile, flirting with women passengers, and exchanging wise cracks, he made the flight fun. From his opening jokes about his apron, to his closing comments about his ex wife, flying alongside the plane on her broomstick he was delightfully unexpected for the entire 90 minutes of the flight.

Every business needs a Joe, someone who’s joy and enthusiasm for his/her job is contagious. But to Robby’s point, as a business owner, you can’t mandate this type of enthusiasm; it springs naturally from someone doing something the genuinely enjoy. The best you can do, is look for the spark of energy in your hiring process.

That has made a huge difference at Roundpeg! Our employees and our customers enjoy coming to the office and spending time with us, because the enthusiasm, joy and positive energy is genuine.

Was Joe’s smile and attitude enough to get me to purchase another ticket on United? That remains to be seen, but it was a lovely surprise to see his face as I boarded the Indy leg to head home!

It’s been an amazing summer here at Roundpeg. Allison, Taylor, and Jay are all hitting their stride and constantly coming up with ideas to serve our clients in new and exciting ways, and we’re lucky enough to have four fabulous interns to assist us.

Emily came up with the idea of creating a custom landing page for our Facebook Fan Page (Please Like us!) and Dan and Heather did an awesome job implementing it. Thanks to Kelly, our WordPress pages are filled with unique new plug-ins.

Jay’s been taking the lead on increasing our involvement with AddressTwo, while Allison’s been focused on behind-the-scenes logistics. Taylor’s been driving our successful Business Card Makeover contest.

And me? I’ve been working to support my team and make sure  they have all the tools they need to keep up the good work. How do I know it’s good work? We’re starting to see imitators pop up with ideas that are remarkably similar to our own.

And we all know that imitation is the sincerest form of flattery.

There was a point in my life, when I managed large teams.  I loved the challenge of helping people define a common goal, and move toward it.  The job of recruiting the right people, and keeping them motivated was always fun and rewarding.

Today, I run a much smaller organization, but the need to build and motivate my team is still important, so I enjoyed reading an article by Melissa Raffoni about what employees really want.  While most of her comments are directed at CEO’s of large companies, many of  her comments have equal relvance for the small business owner.

Her list of the Eight Things Your Employees Want From You included:

1. Tell me my role, tell me what to do, and give me the rules
2. Discipline my coworker who is out of line.
3. Get me excited
4. Don’t forget to praise me.
5. Don’t scare me.
6. Impress me.
7. Give me some autonomy
8. Set me up to win. .

While they are all important, for the small biz owner I would add one more to the list:

Give me a sense of ownership – Help me see how my contributions matter

What would you add to the list?

Email Ninja, Michael Reynolds

A ROWE has nothing to do with boats, water or even my former employee Amy.  It is an alternative operating system for your company.

In a recent conversation with  Michael Reynolds, owner of Spin Web I  was introduced to the concept of a ROWE environment where employees are not paid by the hour, they are paid by the result.

For small business owners this can be a scary, but structure.   But if executed correctly a ROWE environment will move your business forward.

Want to learn more about ROWE? Listen to today’s podcast, check out Michael’s blog, or even one of his seminars about how you can create a ROWE environment in your company.

We created a fun direct mail piece for Roundpeg a few months ago.  Featuring a little boy in over sized clothes, the headline read: “When it Comes to Marketing, One Size Does Not Fit All!

I loved the card, because it really captured my attitude toward marketing.  While certain elements may transfer from client to client, each situation is different.   Great marketing strategies take all the elements into consideration: the needs of the client, the state of the market and the available budget.

Smart business owners recognize this applies to other elements of their business such as their employees.

Employees are not the same size.  Some need more direction, others need more challenges. So even in a small company the struggle for  the owner is to be fair,  but create incentives and an environment in  which each employee is motivated and empowered to do their best work.  It is easy to say, hard to do. What are your employee management  strategies?

Does it seem like I am focused on my organization a bit more these days?  With 3 interns, and 1 new employee, along with the rest of my team, I am spending a lot more time managing, and less time doing.  It isn’t easy!

This week we made a new change at Roundpeg, as my daughter, Michelle, joined our team.   A recent grad, she has worked at TechPoint for several years and has local industry contacts to match her mother’s.  She has good skills, my employees like her,  and many of my clients have known her for years, so it seems like the perfect fit – right?

The question is  – can we work together.  Can I stop being her mom, and be her boss? Can I judge her performance the way I would any other new employee, or will I let the 25 year relationship we have get in the way. At the same time, will she really take this seriously? Will she take feedback from me as her boss, and not her mom?  I don’t know the answer to any of these questions, but I would love to hear from other small business owners who have done this successfully or unsuccessfully.  I would really like to make it work.