HUMAN RESOURCES

CEO's Regret #6: Not Hiring an In-House Recruiter

Advertisement

Behind every successful CEO probably lurks at least one major regret. The best, or the luckiest, CEOs learn from their mistakes and get an opportunity to rectify them. But as we learned from the stories that company founders shared with us, even the ones who get a second chance can still feel the repercussions from their moves for years afterward. And the lessons they gleaned stay with them and influence their business decisions in sometimes surprising ways.

Regret 6: Not hiring an in-house recruiter

Company: T2 Systems (#394 on the 2000 Inc. 500), in Avon, Ind.
Business: Designing software that tracks parking tickets
CEO: Mike Simmons

For the first four years after its founding, T2 Systems doubled its revenues every year. In 1998, however, its growth reached critical mass, and CEO Mike Simmons found himself needing to double the number of employees, which then stood at 12. Lacking any kind of human resources department and faced with the "exorbitant fees" of outside recruiters, Simmons charged his three managers (and himself) with recruiting their own workforce. It was, he admits, a costly mistake.

"There were not enough people to do all the work there was," recalls Simmons. The recruiting process made matters worse because, he says, "it took the managers out of the work process." Instead, they were busy screening résumés, checking references, and traveling around the country to find qualified employees in the company's high-tech niche. "The talent pool for us is very small," Simmons explains. The ideal potential employee needs to know software plus the principles of the parking business.

Simmons did use several professional recruiters, who, for a total of $50,000 to $60,000 in fees, yielded only two or three hires. He realized he could have hired a full-time recruiter for that amount and gotten more bang for the buck. Finally, last year, he did just that, tapping one of the few outside recruiters who had really impressed him.

After his entire management team had spent a year hiring 12 people, the recruiter was able to match that number in about seven months. The company now has 44 employees. As soon as he had hired a recruiting manager, "our sales went up, our customer service went up, and our hiring became more efficient," says Simmons. "Most of all we had suffered because of the burnout factor for managers."

The recruiter, at his own request, has since moved over to a sales position. Simmons is going out for a round of additional funding and promises that one of his first hires after he gets that money will be a new in-house recruiter.

Copyright © 2000 G+J USA Publishing


More regrets from this year's Inc. 500 CEOs:

CEO's Regret #1: Being Distracted by a Buyout Proposal
CEO's Regret #2: Not Seeking Financing Sooner
CEO's Regret #3: Not Trying to Go Public Sooner
CEO's Regret #4: Not Going to College
CEO's Regret #5: Hiring the Wrong Executive
CEO's Regret #7: Charging Too Little for Too Long

Last updated: Oct 15, 2000




Register on Inc.com today to get full access to:
All articles  |  Magazine archives | Livestream events | Comments
EMAIL
PASSWORD
EMAIL
FIRST NAME
LAST NAME
EMAIL
PASSWORD

Or sign up using: