Hard Hiring Decisions

One of the good things about buying out my brother at Graff-Pinkert was being asked by lenders to study my costs. What I found out, among other things, was that direct labor costs in the shop comprised a small percentage of my cost of sales, even though we refurbish many of the machines we sell. But the competitive advantage of selling a superior product compared to our competitors (excuse the advertising) is our expertise in upgrading the flawed used machinery.

I concluded that I needed to protect this advantage and expand on it. I raised all of our key employees’ salaries significantly and began an aggressive training program to upgrade the mechanical skills of our committed but untrained younger employees.

Our long-time electrician, who had retired but returned as a part-time independent contractor, just retired again, leaving me the opportunity to hire a full-time machine tool electrician. This was the opportunity to find somebody who would improve our CNC capability and get younger. Not that there is anything wrong with old, yes, I’m taking Social Security, but …

I advertised on Craigslist at Noah’s urging and decided to offer less than half what an electrical contractor would charge me but more than I had paid for our former full-time electrician. I figured $35 per hour would bring action, and it did.

Strangely, I hired the first guy who called, Julio, a Dominican living in Santa Barbara, California, though I did talk to several other applicants and received 40 résumés.

Julio really wanted to come to Chicago because his girlfriend lives here. He has had two jobs in the 14 years he has lived in the U.S. He flew to Chicago on his own dime for an interview, and when I offered him the job he told me he couldn’t leave his current employer high and dry so I had to wait more than a month for him to start. He is extremely confident in his abilities, though his previous experience has been mostly on printing equipment. His references were very strong and our retiring electrician said Julio knew his stuff and would be happy to train him.

Time will tell whether he will work out for us, but his confidence and eagerness make me think he will challenge us to come up with new tasks to keep him interested long-term. That should make us better.

In the office, our secretary, a bright and personable young woman, recently quit unexpectedly to try something new. My first thought was to try to woo her back, but after that did not work, I decided to go a different way.

I was aware of a woman who had a responsible job at a paving firm in our area. She had worked there for 19 years but was starting to feel thwarted by the family business. A new generation of managers were coming in, and she did not like the vibe. She said she was also simply looking for a new challenge professionally.

I wanted an Administrator/Office Manager who was mature. I commented to a few people that I wanted an adult. I know that in politically correct circles I should not write stuff like this … but it’s my blog. I’ve had several severe disappointments in this job in the past. I was willing to pay well above “scale” for the person I project to do a big portfolio of tasks better than they have been done in more than a decade.

I’ve come to some conclusions and generalizations about hiring today in America. There are good people out there if you look, use your networks and ignore written résumés. The big enemy of good hiring is worrying about offending the people who currently work for you. If it takes more money to get the person you need than you are paying your current employees, you probably should raise your good people and not worry if your mediocre ones gripe or leave.

I think one reason unemployment is still high in the U.S. is that employers are learning this lesson. You do not need average employees. Only keep the really good ones and pay them well. You won’t need as many and life will be simpler.

Question: What works better, growing your own employees or bringing in expensive talent?

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3 thoughts on “Hard Hiring Decisions

  1. Josh Weaver

    In our shop we’re big on cultivating growth in our employees. Our current head machinist runs all of our tooling and fixturing on 3 CNC machines started out sweeping floors. Our machine builder and maintenance technician had most of his experience in automotive repair and plastics when hired and was trained to build machines. He’s now better than the man who trained him. The guy who runs our grinding machines was a welder and the guy who trained him and engineers the grinding processes was a computer nerd with barely any college education.

    Our key positions in the shop are filled by people who were not formally trained in those positions but have a will and ability to learn, problem solve and get the job done with what is available. In the past the company has hired people who were brought in as skilled in their field and it has never seemed to work out. We seek out motivated individuals with specific character traits over those who are already trained and I think our company is all the better for it. They approach their job with a more humble attitude and are more able to think outside the box because they are free of the tunnel vision that comes with working in one field for a long period of time.

    We have all learned and grown together and as a small company this makes us far more tight knit and a better team. We are all in this together to make a good product and keep our company in good shape.

  2. rob klauber

    Growing your own employees makes more sense cost and culture wise. However, if you have a need for a very skilled experienced worker in a key position and no one in your shop has those skills, than you have no choice but to look for outside talent. It is an unfortunate position to be in but in lean times you can’t afford utility or bench players with those skills. Afterall, we’re not talking sport teams. The goal is to have enough revenue and work so that you need more than 1 skilled worker for any task or function which means ongoing training. You also need workers with great skills and knowledge willing to teach, one who doesn’t suffer from the fear of losing his or her job if they impart their knowledge to others. A strong business is the key here. If workers sense an erosion in business, they become less willing to teach for fear of losing their job to a less expensive assistant.


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