5 Hiring Mistakes I Made Running a Small Business

One of the most difficult tasks facing small-business owners is hiring. When you run a smaller organization, each person you hire impacts your operation more than most individuals would at a larger company.

In many cases, small businesses lack some of the fail-safe systems bigger companies have. You may not have a human resources department or even another senior person to run potential hires by.

Even if that's the case, you should be able to take steps to make sure you maximize your chances of hiring the right person. One way to do that is to avoid making these mistakes that I have made:

Hiring is challenging, but there are some traps you can easily avoid. Image source: Getty Images.

1. Don't skip reference checks

Most reference checks are a waste of time. The people you are calling may not be allowed to talk with you, or they may say nice things because they don't want to stop someone from being hired. Sometimes, though, a person will have something damning to say about the candidate that will make you glad you made the call. (Or, if you skipped the call, make you upset when you learn the horrible truth after it's too late.)

2. Don't ignore your instincts

Once, when I was hiring reporters for a small newspaper, I was sent a resume from someone dramatically overqualified. It looked like his career had been a hill: He had worked his way up to bigger newspapers and back down to smaller ones.

I asked him about it during the interview, and he talked about having family ties in our area. That sort of made sense, so I overlooked the fact that he had entered the interview drinking from a can of soda he had brought with him.

That seemed odd, but his work was good, and I hired him. It took maybe two days for people to mention to me that his ever-present soda can smelled of booze. And his actions quickly confirmed that he was drinking on the job.

3. Don't hire as a favor

When I worked as the general manager of a large toy and hobby store, the owner would often suggest people for me to hire. He was (and is) a compassionate man who liked to give second chances to people who needed them.

In most cases, these people did not work out. Sometimes they lacked the skills needed for the jobs we had. And a few times they were overqualified, which left them bitter at their lot in life. Helping these folks seemed like a good idea. But in reality, we weren't doing anything for them, and we were hurting our business.

4. Don't skip background checks

It's easy to do a background check online. It takes a few days and costs under $50 in most cases. They can turn up whether potential hires have something big in their past -- like a criminal conviction -- that they neglected to mention. (My mistake here led to hiring someone for a job that potentially involved driving, when the person legally could not drive.)

5. Don't be a stickler

Again, back in my toy store days, we struggled to find someone to run our model train business. We passed on several strong retail operators in order to hire someone experienced with model trains, hoping that he could learn the retail side.

It didn't work and showed me that it's never a good idea to force candidates to meet a rigid skill set. In this case, we could have taught someone the business while providing backup from product experts, and it would have worked out better.

Trust yourself

Perhaps the most important lesson I learned over many years of hiring is that meeting a person tells you more about them than a resume can. Sometimes that led me to hire less-experienced people or even real reaches because I felt good about them. That generally worked out (aside from the drunk reporter), and it often led to very loyal employees.