Make the Right Hire for Fiscal Stability
Whether it's support staff or salespeople, bringing the right person into your brokerage can boost morale and improve your bottom line.
August 1, 2014
Successful real estate brokerages keep their finances on an even keel. That means managing cash flow through the natural cycles of the market. It also means making sure your employees are up to snuff.
“A problem many entrepreneurs fall into is bad hires,” says Jerome Katz, professor of entrepreneurship and director of the Billiken Angel Network, an investment group at Saint Louis University.
A bad hire can drain morale – and be a drag on cash flow. But so can pink slipping someone. “It’s really noticeable when you get rid of someone when there’s only five or 10 employees,” Katz says. “The question is, ‘How much time and counseling do you put into remedying the situation before you pull the plug?’”
Making the decision to fire someone can be wrenching. But doing nothing can be even worse. “Someone who is not really contributing can create problems if you do nothing, especially in a small office,” Katz says.
The best way to avoid the problem is to avoid bad hires.
When Jay Kalinski, co-owner of RE/MAX of Boulder, hires support staff, he "goes the traditional way: It's resumes and interviews and calling references." But when he's hiring an agent, Kalinski says there's a different process. "If it's someone new to the area, we interview them and call their former managing broker/owner," he says. "If they know someone local, we reach out to them."
For established professionals, Kalinski says they check the candidate's production and sales volume.
Katz suggests introducing prospective hires around to others you trust in the office. “Let everyone on the staff get to meet the person,” Katz says. “The more people whose opinion you trust that you bring in to the evaluation, the more confident you’ll feel offering someone a job.”
Kalinski couldn't agree more. "We solicit feedback from our agents," he says. "We ask about the candidate's ethics, business practices, and personality. With 105 agents, chances are the candidate has done a deal with one of them. They are really the best source for us."
Kalinski takes input from his agents seriously. He has turned away top producers after negative comments. "Simply because it's such a delicate thing to manage 105 egos, and to have a couple that don't fit in can cause more problem than you'd think."