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Best Hiring Practices at Employee-Owned Companies

An NCEO Issue Brief

by Camille Kerr, Michelle Caylor, Cheryl Coulthurst, Randy Ferino, and Lloyd Gottman

This is one of our archived publications; specialized publications that have been removed from our main publication list and are not being updated, but are are still available for purchase, although sometimes only in digital form.

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Hiring practices are an important aspect of developing and maintaining an ownership culture. New hires who embrace the ownership culture may develop into committed, loyal employee owners who champion the company, contribute to greater productivity, and foster a better work environment. On the other hand, candidates who do not fit well in the company culture can result in unnecessary turnover and may lower morale. The most skilled, experienced, or even the most enthusiastic candidate may not be the best choice for an organization. To optimize the effectiveness of the hiring process, it is important for employee-owned companies to understand how to recruit and retain candidates who have not only the core skills required but also the core values. This issue brief shows how successful employee-owned companies are approaching this task. It addresses the entire process, from understanding the role company culture plays through recruiting and retaining new hires.

Publication Details

Format: PDF, 31 pages
Dimensions: 8.5 x 11 inches
Edition: 1st (September 2011)
Status: Available for electronic delivery

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Part I: Understanding and Monitoring Your Ownership Culture

Part II: Attracting the Right Pool of Candidates
Johnny's Selected Seeds: Planting the Seed Through Social Networking
Hot Dog on a Stick: A Colorful Recruitment Strategy

Part III: Creative Hiring Techniques
New Belgium Brewing Company: Putting Culture First

Part IV: Assessments
Using "Job Fit" Assessments to Improve Employee Engagement

Part V: Early Engagement Policies
Web Industries: Two Different Approaches for Two Different Workforces

Part VI: Company Case Studies
The Best People for the Bank: How the Bank of Marin Finds, Interviews, and Attracts the Best Talent
Identifying Future Owners: How North Highland Maintains Its Unique Culture Through Identifying, Assessing, and Hiring the Best-Fit Talent
Early Employee Engagement Policies at CALIBRE Systems, Inc.


From Part IV, "Assessments "

In addition to creative interviewing techniques, companies are more frequently turning to assessments to help choose new employee owners. Using proven methods, these tests determine whether a candidate has the right set of skills and traits to fit into the culture and be a high performer in a specific position at the company. Companies considering assessments have a wide array of questionnaires and services to choose from. Some popular assessment methods include the Myers-Briggs Type Indicator®, DISC (Dominance, Influence, Steadiness, and Compliance), and JobFit™.

Companies have a number of choices to make with regard to personality assessments, including:
  • Which assessment product to use
  • How to integrate the test with other hiring practices (interviews, applications, etc.)
  • Whether to use the test alone or with consulting services
  • When to use the test (only for managerial positions, only sales, all positions, etc.)
  • How much reliance to place on the results (keeping in mind legal considerations)

For example, Web Industries uses DISC, an online assessment tool, to start a dialogue with candidates about their strengths and opportunities for improvement. The company does not use it to disqualify candidates; it is just another factor (along with the resume, telephone interviews, group interviews, etc.) to determine whether the candidate is a good fit for the job.

Plante & Moran, a consulting firm with a human capital division, has been using personality assessments for 50 years and strongly recommends them. The company uses assessments internally and also conducts them for their clients. Steve Gravenkemper, a psychologist and partner at Plante & Moran, stated that the firm's use of internal assessments has led to a "jerk-free" workplace. The firm has been on Fortune Magazine's 100 Best Companies to Work For list for 13 consecutive years.

Plante & Moran looks for team players who have a high energy level, are conscientious, and have a strong customer service orientation and work ethic. Other qualities that an assessment captures include:
  • The candidate's level of curiosity
  • How serious or light-hearted the candidate is
  • Whether immediate feedback is important to the candidate
  • Strength of the candidate's communication skills

According to Gravenkemper, there are three times when assessments can be particularly useful:
  1. In key positions, when the company has narrowed its list to a few finalist candidates.
  2. To screen candidates. This is where a group of high-performers are tested in the company to create a benchmark database. Potential candidates are tested early on and their scores compared to the benchmark.
  3. CEO succession. This is where the company creates an in-depth success profile to ensure the right person is chosen for the company's top position.