Episode 210: Stop Hiring to Fill a Gap and Start Hiring to Build a Firm

Hiring in a panic is one of the most expensive things an accounting firm can do. And most firms do not even realise they are doing it until the damage is already done.

In this episode of The Wize Way Podcast, Dani walks through the hiring mistakes that hurt firms the most, why they keep happening, and the practical prevention strategies that change how you approach every hire from here on.

You'll learn:
 ✅ Why small firms feel bad hires harder than larger ones
 ✅ The three hiring scenarios that cost firms the most time and money
 ✅ Why a culture mismatch can be more damaging than a skills gap
 ✅ How to run interviews that feel like conversations and still get the information you need
 ✅ What real reference checks actually sound like
 ✅ Why your probation period is only useful if you are willing to act on it
 ✅ How to define your non-negotiables before you start looking so you stop compromising under pressure

If you have ever found yourself hiring someone just to fill a gap and paying for it months later, this episode gives you the framework to make sure it does not happen again.

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PS: Whenever you’re ready… here are the fastest 4 ways we can help you fix and grow your accounting firm:  

 1. Download our famous Wize Freedom Map for FREE - Find out the 101 projects every firm owner must implement to build a $5M+ firm that can run without them - Download here 

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3. Work with Jamie and our mentors for 8 weeks - Build a custom business plan for your firm - Apply here

Transcript

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Welcome And What We Solve

SPEAKER_00 0:00

Welcome to The Wise Way, a show for accounting and bookkeeping firm owners who want more time, profit, and freedom, and a business that can run without them. I'm Brett Ward, your host, and each week we deep dive into the real stories, proven strategies, and battle-tested tools from successful firm owners just like you. Our wise mentors want to share their journey of how they've scaled and systemised their way to freedom so you can too. If you're stuck in the grind or you're ready to scale smarter, this is your blueprint. Let's get into the episode.

Why Firms Hire In Panic

SPEAKER_01 0:38

Today's topic, I'm really looking forward to it. It is, hopefully, it is going to help everyone when it comes to hiring and everything. And obviously, this time of year, I think firms sort of go into panic mode when they're I suppose if like you're in Australia and stuff. Yeah, I've just had all of a sudden a lot of clients saying, Hey, I actually need to hire someone like right now. And it's like, did you plan for this? Like, did you did you think about this a few months ago? And yeah, a lot of people just don't think about that sort of stuff. They just sort of they go off like reactive mode. Is that the the term? They're more reactive than than actually planning ahead. Hopefully you get a bit out of this this topic. Um, I will say I've got like heaps of notes. So if it looks like I'm reading um like you know a script and stuff, it's because I am. Um because I want to make sure that I'm giving you guys as much information as possible. I guess let's let's get stuck

Three Bad Hire Scenarios

SPEAKER_01 1:35

into it. So I've sort of written that small firms tend to really feel bad hires way more than bigger firms, and that's purely because obviously when you're a smaller firm, generally there's no HR safety net. There's nothing like that, you know, and often there's no budget as well. So, you know, if the if you don't have a huge budget, you tend to when it comes to the like the mistakes, often no budget to just eat the mistakes and try again. You can't just try again. You've sort of got to go with what you've done. So if you're if you're a smaller firm firm, you do tend to feel it a bit more than you know, if you've got a larger firm. But I have written some like uh real-world scenarios where you know hiring mistakes hit the hardest. The first one is the firms that say that we needed to hire someone yesterday, um, because they're just they're that desperate. So a 12-person firm loses their only senior accountant and hires the first decent-looking resume within two weeks. Six months later, that person's disorganization has caused two missed client deadlines and a scramble to redo their work, costing far more time than the rushed hire saved. So who's sort of been in it in that situation where you've just like you've seen a good resume and you've gone, okay, I need to hire that person because I'm that desperate? You could hire someone who looks great on paper, but then when they actually do the work, sometimes they don't have the initiative. Like you you need an admin person who is going to take initiative, who's going to be able to just think on their feet and be like, okay, well, this isn't happening right now, but I can see that there's a gap here. So, you know, I need to sort of fix that. So, yeah, that's a great example, Thomas. Hiring someone who's who knows what they're doing, who actually has the yeah, I guess the initiative to do it. So the second one is the oh well, this actually aligns perfectly. So the technical skills are with a uh with a culture mismatch. So that's basically where they have the technical skills, but they don't actually have that that good uh culture match. So, you know, you've you come across it could be like a senior production manager, for example. They can be like super smart with when it comes to tax and bookkeeping or whatever it is, but they could be a micromanager or they could have, you know, just a really toxic attitude. And if they if they're in that manager position and they're having to deal with other stuff, it's gonna affect affect everyone. It's not just affecting their sort of area, it's gonna affect a whole range, like a whole yeah, connection sort of thing. So, you know, you want to make sure that when you are hiring someone, especially for a manager role, whether it's client manager, senior production manager, whatever it is, but even just you know, your normal production team, they've got to have the right attitude, they've got to have um the right mindset as well. Um, and they've got to be willing to work with the team, especially if they're working remotely. So working remotely, as we know, like it's harder to connect because you're not face to face with that person, like you're not sitting right next to them in the office. So, you know, you you don't want to just hire someone who is going to do their work and then just leave and then have no connection at all with their with their teammates. Because one, they probably won't last as long because they feel really isolated. Um, but it also means that they may not feel comfortable to come to you if you've got an issue, or if they've sorry, if they've got an issue because they're not willing to build that connection with you because they're just sort of, you know, they're they're like, no, I can do this myself. Yeah. So if you if you hire someone who's sort of, I guess, got the right attitude, who's like, you know what, I've got an issue right now, I'm gonna, I'm gonna reach out to my my manager or my boss or whoever it is, you know, it does make things easier. So the third one, this is the final point for for this section, is the remote hire who needs direction. Um, and this again sort of plays off what we just spoke about. So a small firm hires remotely, does a couple of video calls, checks references loosely, um, and the person turns out to need far more oversight than your management team can provide. I guess this is where the initiative comes into it as well. So if you're hiring someone, but they just, you know, they actually need to be in the office with someone directing them. Um they're not used to working from home or they get you know super distracted by things. They could have kids, which is fine. Like it's fine hiring someone who's got kids who, you know, who does work remotely, but they can't be working and looking after their kids at the same time. You know, you you want to be checking that they've actually got, you know, the the child goes to child care or there's nanny or or someone, you know, their partner to help them out so that they can concentrate on their work. I'll never forget if we hire someone, and then like six or seven months later, we found out that she was actually homeschooling her children at the same time. We had no idea about the kids or anything during the interview process and then all the hiring process. And then yeah, we found out later that yeah, she was homeschooling her children while she was working. So it's it's one of those things where you don't you you know, sometimes you don't want to ask in the interview interview, you know, do you have children? But I guess it's the way that you frame the question. For example, I would say, do you have a private space to work? And then that tends to give like give a bit of insight of, you know, oh yeah, I I work in my office because you know I've got children or whatever it is, or if they say I've I live alone, so I don't really need a private space, like just a bit of insight. I guess that's where in the interview process, making sure that it's not so much an interrogation, but a conversation with someone so they feel comfortable enough to to say, you know, yeah, I've got I've got family, I've got kids and everything, and then just getting a bit more information from them that way. Or you could just flat out say, do you have children? But if you if you don't talk about it.

unknown 8:18

Yeah.

SPEAKER_01 8:19

So that's that's that sort of that section about you know the real life scenarios that people do go through when it comes to bad hiring and everything.

Prevention Strategies That Actually Work

SPEAKER_01 8:30

And I guess what we were saying earlier about like looking at the resume versus like actually testing their skills. Um, and one of the points that I'm about to talk about sort of helps in this area, these are prevention strategies for firms to make sure that you don't have a mishire. So the first one is slow down the parts that are cheap to slow down. Um, you can't always afford to wait for the perfect candidate, as we know, but you can afford one more structured interview or one more reference call. The expensive mistake is usually made in the last 10% of the process, not the first 90%. So, you know, testing. If you're testing every sec uh every you know single candidate, that's where it becomes really expensive. But the other side of things, like asking them technical questions in the interview process, for example, or talking to their past managers and just confirming that they've got the right skills or whatever it is, that is inexpensive to a point. I know everyone's super busy. Um, and what's that saying, time costs money, but that's still cheaper than having to buy, you know, a $200 test every for every candidate that comes through. So that's the first one there. Uh the second one is uh use structured consistent interviews, not just conversations. And I know earlier I said about you know, you want to make sure that uh the interview feels like a conversation and that's 100% true. You never want to feel like you're interrogate interrogating someone because you won't get any of the information that you need from the person. Imagine, you know, sitting down, like from a candidate's point of view, imagine sitting down in an interview and then having someone just bombard you with all these questions in a really in like just feeling like you're interrogated, you're gonna be really closed off, really standoffish, and you're just gonna give them the bare minimum, basically, because you want to get out of that interview as soon as possible. Whereas if you sort of treat it like you're getting to know someone, um, which that's basically what it is, you know, like you're you're meeting someone you, you still ask them the important questions, but you do it in a manner that makes them feel comfortable, um, like you genuinely want to know about them, they will feel more relaxed and they will tell you a lot more. That's the the second one. The next one is tests for the actual job. So, along with tests that you can find in the wise market account tests, test gorilla, you know, there's so many different ones. Um, you can also do a paid trial, work sample, like that sort of stuff. A short paid trial period reveals far more than an interview. Uh, for a five-person team, one bad hire can be 20% of your headcount. A few hundred dollars for a trial task is cheap insurance, basically. I know even for wise, like if if we're hiring someone um in like marketing or graphic design or whatever it is, like Brenton will get them to do just a little trial job and it could be a couple of weeks or something, just to sort of see what their work is like and how they work with the team as well. Because we need to make sure that they're actually gonna fit in with our culture, with our with how we work. And then, okay, so number four, um, do real reference checks, not formality checks. Um, and what I mean by that is you know, ask the manager or their past manager specific questions about, you know, what would you have wanted to see um improved, like with the with the person? How do they handle handle a tight deadline? Um, those are the sort of questions that you want to ask. You don't want to just ask, you know, your generic sort of questions about uh can we confirm their dates of the them working and stuff. Like you still want to ask those questions, but you want to focus on the other stuff of like what was it like for them working for your firm and working in the team and you know how do they handle those sorts of situations? And then the next one is define the roles, the the roles non-negotiables before you start looking. And that's super important because um small firms often hire reactively, like what we were saying earlier, and let the job description drift towards whoever's applying. I've seen that happen so many times with our clients, and then so yeah, so decide in advance what skills, trait um, or behavior is truly non-negotiable and don't compromise on it under time pressure. Like that, that's a big one because that's where you start. That's a classic example of a mishire. Because if you're sort of if you're compromising, if you're saying, yes, I want a senior production manager, and then you end up with an intermediate accountant because it's the best person that's come through in your pipeline, you're gonna spend months and months and months training this person. There can be a bit of compromise. So, like if you've got, if you're looking for a senior accountant, for example, and then you end up with like a high-end intermediate accountant who only needs maybe one or two months of training, that's okay, because in reality, everyone needs a little bit of training when they first start a new job. It could just be on the process of how you like to do things, or it could be a little bit of technical skills. Don't do like a huge jump because that's just gonna waste everyone's time and then and money, and it's just it's a headache for everyone, basically. Okay, so the next one is build in a real trial/slash probation period and actually use it. So many for small firms have a six-month probation period, and that's what we personally recommend. A lot of I've heard of some firms doing like a three-month probation period. We say that's way too short because you just you you don't really know in the first three months. Six months is is you know a what a way better, a better way to do it, basically. Yeah, so don't just do like a six-month probation period on paper, but never act on it because letting someone go feels disruptive. You know, set specific checking criteria at 30, 60, and 90 days and commit to acting on them. Yeah, so there's that one. And then the next one is separate the I like this person from the this person is the right fit for this role. Have a structured scorecard, and as you guys know, we love our scorecards here at WISE, rating candidates on specific criteria rather than that gut feeling, um, and update this throughout the entire hiring process. So the last one, my last point, have a fast exit plan, not just a fast hire plan. So this one is part of what makes bad hires so costly for small firms is that they linger too long once a problem is apparent. Knowing in advance what you know this isn't working looks like and being willing to act on it quickly limits the damage. And I think that we sort of touched on this earlier, but it's still really important to discuss because I mean, I guess we've all sort of been there where you've you've hired someone, you think that this is going well, but then you start noticing little things here and there, but you just don't

Final Takeaways And Next Steps

SPEAKER_01 16:08

act on it.

SPEAKER_00 16:08

Thanks for tuning in to this episode of The Wise Way. If today's episode sparked an idea or helped you see things differently, please don't forget to leave us a review. And if you haven't subscribed to the podcast on your favourite platform yet, please go ahead and do that as well. Let's continue the conversation here through YouTube or any other social platforms that you can find us on. And just remember, if you're not a subscriber of our weekly Friday tip newsletter, you can get that to your inbox every week going forward. Whether you're starting out or scaling up, you don't have to do it alone. Let's build a business that works for you the wise way. We'll see you in the next episode.