The Underperforming 10% of Your Team Can Burn Your Small Business

If you only have 10 people on your team and one of those is, at best, average then that means a full 10% of your workforce is holding your business back. No small business can afford that anymore. Here's why.

The Underperforming 10% of Your Team Can Burn Your Small Business

WORKetc is a small business. Tiny, really, compared to others in the CRM industry.

But still—we’re able to provide our services to over a thousand companies, big and small, all over the world.

How? Well, by using a complete business management solution to run day-to-day operations, for one, but also by obsessively making sure that there are no average people on our staff.

Because these days, no small business can really afford to have average employees. You need to hire slow, fire fast.

Here’s why.

Going By The Numbers

It’s just math, really.

If you only have 10 people on your team and one of those is a poor or, at best, average performer then that means a full 10% of your workforce is holding your business back.

That average performer isn’t the only one you have to worry about, either, as they’re not working in isolation. There’s an opportunity cost as well; they’re also holding back your top performers.

And the worst thing? That employee is probably a great person. In a large organization they would no doubt easily get by and even move up the ladder with the passage of time.

But then they’re not in a large organization. As the team leader or small business owner, you now have to fire a great person. Not because they did anything wrong, per se, but because they were just “average”.

The Costs of Firing People

The Underperforming 10% of Your Team Can Burn Your Small Business

It doesn’t stop there.

According to the Center for American Progress, replacing employees will still set you back a pretty big sum. One of their economic studies found that the typical cost of turnover was around 16% to 21% of an employee’s annual salary.

Except for the very highest-paid jobs, the turnover costs remain consistent across the board. Very complex and specialized jobs (doctors, executives, etc.) the turnover costs can even reach double that of the employee’s annual salary.

So even if you do eventually get rid of an underperforming employee, by that time you will have spent countless hours and resources training them for a job at which they couldn’t excel.

You, the employee who did the training, and the employee you eventually let go of—everyone’s time and money ends up wasted.

This makes it all the more important to find and hire the right person from the start.

Tightening The Hiring Process

While many small businesses may feel like they need to fill a position quickly, it pays to take the time to fully vet applicants or seek out better talent.

Even if you have to sift through a ton of resumes over the course of a couple of weeks, hiring the right person from the start will net you better returns in the long run than just going with the first person who kinda seems to fit the job.

We’ve only hired a handful of people over the years, but we’ve so far had a great track record at finding the right ones by using these techniques:

  • Break through the noise on job listing sites and social media by getting creative with your job details. Use unexpected or surprising words, but make sure you explain the headline within the body of the job description.
  • Keep the role explanation simple. Make sure it’s focused entirely on the task and explain how those tasks relate to what the role needs to deliver. You can also be personable by telling the story behind the role.
  • Offer above industry rates to attract qualified candidates and fast-rising stars. Don’t be afraid to state a dollar figure outright.
  • Promote the benefits that make working for your micro-multinational more desirable than an equivalent role at a big-name company.
  • Set a simple task along with the how-to-apply info to quickly identify people that are truly interested in the role. If they can’t even be bothered to complete the task then they likely won’t be of help to your business.

Small Business, Big Profits

The Underperforming 10% of Your Team Can Burn Your Small Business

Now you might be saying, “But Dan, how is my business ever going to get any bigger if I hire so slow?”

What you need to keep in mind is that growth isn’t necessarily dependent on how many people you have working for you.

We work with a lot of small businesses, most of whom have experienced growth in leaps and bounds in the years they’ve been our clients even without them going on a hiring spree.

Case in point: IT support company Atcom Technology. They first became WORKetc users six years ago, and their customer base has grown seven times since then.

But—and this may surprise you—they still have the same number of support agents today as they did six years ago.

They already had the right people for the job, so they were able to grow their business without taking on new staff simply by optimizing their support process.

Those same agents, who were only able to help around eight people a day each because of inefficient tools, are now helping clients five times that number.

The Right Tools

So it’s not really a matter of size. Finding the right people for the job is the first step. Giving them the tools they need to do that job efficiently is the next.

This is where technology is giving small businesses an edge they never had even just a dozen or so years ago.

With WORKetc, you don’t have to create an end-to-end business management system piece by piece anymore. There’s no need to tear your hair out over app integration headaches, data getting lost in the cracks, or too many monthly app subscriptions.

Once you’ve got the right people on board, WORKetc helps them be more productive and efficient by automating leads and support processes and giving them easy access to the exact information that they need.

You can learn more about how WORKetc can help you build better, more efficient processes by signing up for QuickStart, a one-on-one onboarding program that teaches you how to get more out of WORKetc at no additional cost.

With QuickStart, you get personalized training from one of our product specialists geared towards getting you up and running on WORKetc, all for practically $0.

How has WORKetc helped your small business do more with fewer yet above-average people? Let us know in the comments.

  • For us, the biggest save with worketc is that its all in one place. No need to learn 10 disconnected systems when one does the job. Saves us time and money. And who needs an accountant to calculate how much a project has cost when worketc has all the time against a project and the rate for the employees?!

  • We’ve noticed the benefits from WORK[etc] in an unexpected way: when employees leave, we find ourselves not running to replace them. We started to see that we were a little bloated on the employee side and, with better processes and workflows through WORK[etc], we’ve been able to distribute workload and not have client support suffer because of it. We started giving ourselves enough time with an open position to make sure that a replacement is really needed.

  • Must admit – we need to get better at tracking projects against time taken – but the fact that we’ve been using WorkETC for the last 4 so years and we’ve grown our revenue at a rate of over 40% per year without dramatically changing the team structure, has certainly been a testament that the systems work and allow for growth without highly increasing the staff costs and avoiding having to make firing decisions.

  • Jaymes Baker

    My entire career has been spent working for small businesses and I have to say Work[etc] is an amazing tool. I’ve been at my current position long enough to have seen a few people come and go, I feel like with this software it allowed us to pick up and not miss a beat. I always recommend new employee’s from day one to start using it, and with their daily input it allows us to keep organized even if when have to shift people around. I feel like the last few places I have work with have been in about the same place as far as revenue, however the ones that use Work[etc] seem to have a smaller crew.

  • tekrescue

    Worketc has helped us by saving TIME spent moving support tickets thru the process of initiation to completion. The work still takes the same amount of time but the time keeping records, invoicing, etc has gone down. As for “below average” people…. we interview new hires 3-5 times before we make the job offer. We have been very sucessful in hiring awesome employees to work for our team.

  • Margaret Mack

    The comment on size not mattering really stuck out to me. My company is small and we have few employees doing the job of many. However- it works. It only works because we have capable people. I feel it’s better to have a few GREAT employees then many mediocre employees.
    Also- worketc works for my company because if we do have to let someone go, we dont rush to freak out to see what they’ve been doing. Everything is on WorkETC for us already.

  • Keith Klein

    I like the phrase “hire slow, fire fast.” There are, however, exceptions…to the hire slow part, at least.

    Because of my reluctance, we’ve always been much slower on the fire fast part of the equation than we should have been – back in the days (years) before WorkEtc, anyhow. A wise adviser once told me not to feel bad about letting someone go. He said letting them go may be the best thing you can do for them, as well as yourself. Everyone deserves to find a place where they can shine. Turned out to be sage advice.

  • Regan

    It has been a huge thing for us. we have been able to see where we are losing money in the business.
    This has come from watching the productivity from staff around the office.

    We have now taken the steps to change this and get on top of the staffing issue.

  • Sam Goodwin

    This is a challenge part of business. Hire slow and fire fast. I love that line. What any business needs to do is define the roles and responsibilities. Make sure that person has the skill sets and qualities. Trying to figure who is the right fit is tough. One of my old VP’s told me is: “There are only two things you want to try and look for when hiring people, First, is that they don’t steal or lie and the second thing is that they don’t make a big mistake. We all make mistakes, but you just want to make sure the person doesn’t make a huge mistake, the rest you can teach!

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