5 Hiring Mistakes that Kill Growth

Summary

• Hiring for experience is important, but it must not overshadow the need for a culture and values fit.
• It's critical to be involved in the hiring process, especially if you're the most potent source of the company's culture and values.
• Delegating hiring when your team is inexperienced can lead to a deterioration of the company's culture.
• Witnessing a rapid downfall in company culture reiterated the importance of making thoughtful hires who are in tune with the company's values.
• When scaling, it is tempting to delegate hiring, but ensure the delegation goes to someone who truly understands the company's core values.
• Before delegating hiring tasks, consider whether your team is ready to maintain the integrity of the hiring process.
• The halo effect can cloud judgment, causing you to overlook discrepancies between a candidate's resume prestige and their true fit within the company.
• Confirmation bias can lead to early decisions about a candidate that aren't necessarily fully informed.
• Culture fit is critical and should be considered above experience when hiring for a company.
• Hiring must evolve as the company grows, and what worked at one level may not work at a larger scale.
• Keep in mind biases such as expectation anchors, confirmation bias, halo effect, similarity bias, and affinity bias to avoid poor hiring decisions.
• Diversity in thinking is crucial for a high-functioning team, not just diversity of background.
• A certain level of discomfort in hiring might indicate that you're choosing someone who brings diversity in thought to the team.
• Trusting your gut might lead you to hire replicas of yourself; instead, analyze if discomfort is due to the candidate's unfamiliarity or intimidation, not their lack of fit.
• If your team is chaotic and not working together effectively, it could be an indication that your hiring process needs revision to overcome these biases.

Video

How To Take Action

I would suggest starting by focusing on the fit of the person with the company's culture and values. It's important to remember that while experience is significant, it should not eclipse compatibility with the company's mission and team. Here's what to do to ensure you're making hires that align with your company:

1. Be Involved in Hiring: If you shape the culture, stay involved in the hiring process to ensure new hires align with it. As the company grows, delegate carefully and only to those who truly grasp the core values.

2. Avoid Confirmation Bias: Don't make early decisions about a candidate. Keep an open mind throughout the whole interview. Ask questions and be curious instead of jumping to conclusions.

3. Check Expectation Anchors: Roles evolve as the company grows. Avoid looking for someone who is just like the previous person or like yourself; focus on the needs of the role now.

4. Look Past the Halo Effect: Don't get dazzled by a fancy resume or past company prestige. They must fit the culture and understand the mission above all.

5. Embrace Diversity of Thought: While similarity might feel comfortable, having a wide range of perspectives is crucial for success. Being a little uncomfortable with a hire may be a sign that they are bringing necessary diversity to your team.

6. Trust But Verify with Discomfort: If you feel uncomfortable, discern if it's because the candidate is unfamiliar or intimidating, not necessarily a bad fit—this is crucial for avoiding similarity and affinity biases.

For small adjustments, check that your current team aligns with these principles. If there's chaos and lack of harmony, it might be time to review your hiring process to correct these biases. Implementing this understanding in your next hires will help avoid repeating past mistakes and will set a stronger foundation for your team. Remember, hiring is not just about filling a role; it's about building a team that will grow with your company.

Quotes by Leila Hormozi

"you have to change this into the kind of company that you would be excited to show up to every day"

– Leila Hormozi

"if you have a shitty culture if things aren't going well if there's not a sense of accountability if you feel like people on your team are not the kind of people you want on your team it starts with the hiring process"

– Leila Hormozi

"we often want to hire people with more experience but you can't let that overshadow like they have to be a culture fit they have to have the values they have to be on board with the mission otherwise none of that's going to work"

– Leila Hormozi

"if you judge somebody you will never influence them and they certainly won't work well on your team"

– Leila Hormozi

"if you bring someone on and you're hiring someone and you actually feel slightly uncomfortable not because they're bad for the role but because they're unfamiliar to you or maybe intimidating or maybe because you feel like you can't predict them that is a good thing"

– Leila Hormozi

Full Transcript

when we're looking to grow and level up our company we often want to hire people with more experience but you can't let that overshadow like they have to be a culture fit they have to have the values they have to be on board the mission otherwise none of that's going to work why is up welcome to my youtube channel my name is laila hormozy co-ceo of acquisition.com uh if you don't know acquisition.com is or you're new to the channel acquisition.com is a portfolio of businesses that does over 100 million per year in revenue and my goal with this channel is to help you get from wherever you're at in your business to between 3 and 10 million in revenue for free so that being said what i want to talk about today is i want to tell you guys a little story because the last three days i've had a lot of interviews and a lot of you know coaching our portfolio company ceos on some of their interview processes with roles that maybe like they're not equipped with or they've never hired for before like they don't know what that role does and so we're gonna get tactical today and i want to break down you know some of the stuff that you know i know it's not sexy and i know it's not you know like this is the new marketing hack or this that and i always feel so lame talking about hiring honestly but it's so [ __ ] important it pisses me off that people don't get it like it really like and i think i feel pissed because honestly this is something that i struggled with in the beginning and because of that it really led to a ton of mistakes in the business and i just just don't want other people to make those [ __ ] mistakes because they suck and so i'll tell you the story which is you know when we were growing gym launch in the beginning i was over all the hiring and so i was over hr i was over the hiring i was super involved in all the interview processes and it got to a point where you know we grew really quickly you know i think the first year we did and i'm not the numbers person i think it was the first year 17 million or 25 million i don't remember it was that was the first or second year so either way it was a lot of money and i've never done this before i had no experience i know what the [ __ ] i was doing and because of that you know we're scaling and people are saying like layla like you really need to let go of hiring like you can't be this involved in the process you know you're just you're so busy you have so much on your plate you know look at your days because i was working you know from 5 a.m until you know 10 p.m most days but i did love it you know what i mean like i was like you know but all these people like they're more experienced than me and you know they have a track record and i don't and i'm just like this inexperienced person who's never even managed a human in my life so like i should listen to them for sure and everyone said you know you've got to delegate some of this stuff and particularly hiring like especially with the amount that you have to because the business is growing so quickly and i think what what was missing in that piece of advice was it wasn't like ill-intent by anyone telling me that it was that there's a lack of context and nuance which is if i'm not involved in the hiring process and i'm the most i am out of the whole business the most potent source of you know culture values etc i know what we need more than anybody and there's a lot of inexperienced people on the team is it the right idea to delegate that to them well probably in that situation the answer is no and so i didn't know that and there was no context for those who were kind of you know helping me out with those decisions and so i did delegate the hiring process and i delegated to a couple of the higher level managers and you know i said hey but i want to always keep a pulse and take the last interviews and eventually got to the point where they were like hey layla you're really becoming a bottleneck on the last interviews because my schedule was just really full and i was like [ __ ] okay well all right well maybe what i'll do is i'll just meet with people after they're hired and so over that you know i want to say it was like a five-month span that i went from being super involved in the recruiting process and into whom we let in the company to really letting it go and delegating it and letting other people handle it i just watched the culture just really crumble quickly um there's like no really other way to put it like it literally just became an absolute [ __ ] [ __ ] show and i started meeting with these people after we brought them on and i would literally get a meeting and i'd be like hot like angry like sweating just like who the [ __ ] thinks this person should work here like they literally don't even believe in our values like they don't embody what we're trying to you know have on this team they don't fit this culture but it felt so overwhelming because you know i'm sitting there thinking well i can't be doing all the interviewing and hiring and you know then i'm telling myself things like oh well maybe you know maybe they know and you know maybe i just have to get to know this person well enough and like you know i'm sure the managers know what they're doing like they really get our core values and like you know i should trust them more i need to trust my team like i didn't trust my team and because of that you know i talked about it in my video my biggest mistake but you know we got to the point where these managers overhired they hired the wrong people and i woke up one day and we've done our biggest month ever 4.5 million and i was like i [ __ ] hate this company and you know because of that i had to make the decision which in my option in my mind the option was never like you give up and shut down the company it was you have to change this into the kind of company that you would be excited to show up to every day and so that's why this topic is actually really important to me because i think a lot of people look at that and they say like what can you do to protect your culture how do you prevent people the good people from leaving you know how do you make sure you keep the wrong i'm like it all starts with the hiring process so like when people it's very similar to customer churn everyone looks at customer churn they say oh i need more exit interviews i need more surveys i need more ways to make sure they don't know how to cancel i'm like that's [ __ ] up that's not how you fix turn how you fix turns on boarding and activation and making sure you're selling the right [ __ ] customers it's the same with your hiring process if you have a shitty culture if things aren't going well if there's not a sense of accountability if you feel like people on your team are not the kind of people you want on your team it starts with the hiring process it doesn't start with like oh i need more of this and this and this like a lot of people try to fix things through volume and effort when in reality it's like one simple hinge that you need to change and so often when the people are feeling that in their team it's not that you need to change all these things you need to be like training more more accountability more this more just hammering in it's like no you have the right wrong people the right people wouldn't feel so [ __ ] hard with like it's already gonna be hard enough if you're inexperienced you've never done it before you might as well not make it doubly hard by having the wrong people there and so that being said what i want to break down is really i've really tried to hone in and as we you know built prestige and built alan you know and alan i made sure that i approved any higher i was really involved in the recruiting process for almost every role and then with acquisition.com you know i'm involved in the process through and through so i'll take first interviews and i'll take last interviews like i don't give [ __ ] because i am dedicated to making sure that we have the right team and i know how important it is so after having like i'm not in a position where i need to be doing that but i want to because i know it's what's right for the business it's going to set the foundation and so i wanted to share kind of a few stories and a few lessons that i've learned about hiring that i think would be applicable to you so if you have a team and maybe you feel like you're struggling because maybe you feel like i don't even know if these are right people everything's feeling really hard it's feeling chaotic it's feeling like nobody's rowing in the right direction maybe they're not all rowing the same boat or maybe you have delegated the hiring process and you're like i don't even know some people on the team blah blah which by the way people make that like it's a good thing i'm like not a [ __ ] good thing if you don't have thousands of people you should know people on your [ __ ] team i don't know where that got cool anyways because of that i wanted to kind of break down what i have learned and what it is is really i've dialed in being able to spot my own biases during hiring like what is my brain doing during the hiring process like how does our and how does this apply to hiring people and getting the right people on the team and i think that a lot of people don't understand the biases that we use when we hire people and because of that they kind of end up with like an accidental team an accidental culture and they wonder like how am i so bad at hiring and so i kind of want to expose what i've seen to be the like five top reasons people just suck at hiring um or they hire the wrong people because of these misinterpretations and so it's really not that you suck it's just that you're unaware of these things and so i would like to expose them to you so that you don't have to make those mistakes because i made them and they were painful as [ __ ] so the first one is that we all have confirmation bias right so get this 60 of interviewers will make a decision about a candidate in the first 15 minutes okay so you could have an hour long interview 60 of people decide in the first 15 minutes so basically what they do is they decide the first 15 minutes based on some typically one thing that that person says or does and then they spend the rest of the interview trying to justify or confirm their bias so i'll give you some examples if somebody comes on and at first they're shy or they're not smiling or their camera's off the zoom interview you will spend the rest of the interview most likely try and confirm why that person isn't a good fit because of that one action now i've seen this backfire because i've had people hop on and they don't have their camera on and you know i'm like somebody has told me before they're like yeah oh i don't want to hire them because they have their camera on i'm like do they know it was a zoom interview and then you know i go back and ask the person when i interview them and they're like dude i'm so sorry i thought it was a phone interview like i i thought the invite didn't even say and the last three interviews i've been on they were all phone so i'm like oh right because we tend to assume rather than lead with curiosity another example of that would be you know if someone hops on and let's be really real their personality like they're not enthusiastic they're more quiet and you're the like driven excited enthusiastic entrepreneur and you're like oh i just immediately don't like this person like that what you say is you say they're not a culture fit just because someone's less enthusiastic and they're not as upbeat as you does not mean that they're not a good culture fit that just means they might be quiet and i've had some of the like absolute killers be people who are very quiet on interviews and they take time to warm up to you and they've been some of the best people i've ever hired but we have this confirmation bias and so when we think something immediately in an interview we tend to then use that as uh everything else that kind of it's like what tony robbins says right he's like if you wanna if you see if you look for brown you find brown it's like once you get the one thing you just pulled that string and use everything else as evidence as to why that con that bias was cracked and why you shouldn't hire that person and so i would say that what i've tried to do for myself is lead with curiosity rather than assumption so even if someone hops on right away and they don't have their camera on i will literally ask like oh did you think this was a phone interview oh i'm sorry it has their last job did they not have cameras on like i'm not even being condescending i just genuinely want to know because i seek to understand i'm not trying to judge this person if you judge somebody you will never influence them and they certainly won't work well on your team but if you can understand them and you seek to understand them you have the ability to do that and so that's the first one is really confirmation bias the second one is expectation anchors so what that is is that our brains use one piece of information about canada in a hiring process to make a decision so an example for that is one that's very typical is if you're trying to backfill a role or you're trying to delegate to somebody else right you are typically going to look for somebody who is like either who is already in that role or who is like you basically we just have this expectation of something because of something and it there's no correlation there's no reason that because somebody's not like you they won't succeed in that role or there's no reason that because they're not like the person who was in that role previously that they wouldn't succeed in this role but this happens all the time is you know we get somebody in who's very quiet and then you're trying to replace them maybe you find someone super enthusiastic and then you say oh well you know the person that's in this world was really quiet so i'm looking for something that's really quiet those things are not necessarily what are important to the role and they're actually just overshadowing you know the other aspects of that candidate because we have this expectation another example is you know when you're growing your business often what you need in one level is not we need another so i'll give you a really good example i see all the time which is that people typically expect an operator to be quiet to be more passive to be just very loves process and operations and then when they're at 30 million or they're at 20 million they're looking for that same thing they're like well every operator i've had in the past i've expected that they're more quiet more passive they just kind of work on the background stuff i'm like dude i mean if you want to stay at 5 million dollars per year sure hire somebody like that but you no longer want that the expectation needs to change you need someone who's a leader someone who can lead the team someone who can figure out why sales are low figure out why marketing is off like they're your hands they're your integrator it's no longer like someone that's in the background you know just doing passive work but we have this expectation based on what is familiar to us that's the second thing that i see often in interviewing and i've done this before as well but what you have to realize is that i've had i have to remind myself constantly this is that the roles change as the business grows and so your expectation of what it looks like in one level is not what it looks like in the next it's often not even the same personality type it's not the same person you might have different you know character traits etc the third bias that people often tend to have or use in an interviewing process called the halo effect and this one is probably one of the ones that i deal with on a consistent basis and i can give you a couple examples which is the halo effect is similar to the confirmation bias but it's really more on the positive side so what it means is we focus heavily on one thing about that person and because of that it makes everything else look good as well so i see this happen all the time in growing businesses where people are you know we tell them especially as acquisitions.com we're like we want to get people who have no longer just the raw ability to do the job but they also have experience because you no longer have the time to train everyone like you did in the very beginning right you have more demands at your time therefore there's less internal resources trained somebody therefore they have to come with a little bit more experience and so and i'm not saying they should all experience and nothing else like they absolutely need to be a culture fit but i'm saying they can only be a culture fit with like zero skills and so what happens is often people see like you know graduated from pepperdine or princeton or you know worked at this huge company that's like a big competitor or you know whatever and then they send it to me like holy [ __ ] we got this person they're gonna be amazing and i'm like [Music] and i always know that they're gonna pass this interview to me and i'm gonna be like not impressed with the person because what often happens is we just see like this one thing on their resume or this one thing about them and it overshadows everything else that we see and i've been guilty of this there was actually an instance like a year ago where i was helping one of the portfolio companies hire a manager and the manager that applied was like literally the dream candidate in terms of like their experience and they had worked at a company that was super comparable i would say it's a competitor in the space um but they were literally ten times bigger and so i was like holy [ __ ] this guy's perfect he knows exactly where to take this company he's gonna know exactly what to do and i was so blinded by the fact that he was so good on paper that when i talked to him i think that i let that get to me and i looked at everything he said as being good rather than being able to look at what he said in isolation of those factors and the reality is we brought him on and very quickly realized he was not the right person because that culture of that company was very different and so he wasn't necessarily a culture fit and so that's something that we constantly are having to train ourselves with because when we're looking to grow and level up our company we often want to hire people with more experience but you can't let that overshadow like they have to be a culture fit they have to have the values they have to be on board with the mission otherwise none of that's going to work and so that always has to come ahead of experience and pedigree um and you can't get almost enamored with those you know the awesome you know schools that they went to or the crazy experience they had or the business that they worked at we just can't get enamored with that stuff because you know the second thing to that is you know i know a lot of people who can put that they worked at a certain company on their resume but if you ask the ceo ceo doesn't who the [ __ ] they are so were they actually that good probably not that happens a lot so that's the third one now the fourth one is again one that i see all the time which is similarity bias and guys i am so guilty of this when we were growing gymlodge i was so bad at this the similarity bias is basically like we naturally want to surround ourselves with people that we like and people that are like us and so naturally we like people who are like us and have you know similar interests behaviors ways of talking etc and so a lot of times what happens is in the beginning i would say all the way up until 10 million people really like homogeneous teams like they all seem like almost the same person same character traits just really similar it's almost like they talk the same way they walk the same way they look the same way like everyone's the same a big reason that people can't get past that mark is because there's really no diversity of thinking and i think a lot of people talk about diversity and they talk about like color of your skin ethnicity and culture and all these things and i'm like dude no offense but like i don't even pay attention to that i pay attention to the diversity of thinking i'm like do we have people that have different points of views on this team because the more variety in terms of points of views you have the better decisions you'll make as a team and a lot of times people are just uncomfortable with what is different from them and so because of that they try to hire people that seem like them you know and that's why you see a lot of friends and families that are hired because not because the person is qualified for the job that's actually often not the case typically we see the best in people that are seem like us and we see the best in people that are familiar to us and so we're very biased toward why they should be hired but if someone else goes to interview them they'll probably see oh this person's not fit at all they don't see all the similarities because they might be different and they don't see all the good things about them because they might not be you know already have a relationship with them and so it's really important in situations where you feel very much inclined towards somebody like you really like them to have somebody else interview them because oftentimes it's just us being biased because we like them for one reason or another you know like i remember there was a guy i was interviewing and i really liked him because he was the operator at a large company and he had very similar personality to me and he actually was also raised in michigan and so i was like dude i just love this guy he's amazing but like i had this feeling in the back of my head that he wasn't the right fit like i just like kind of like and so like i brought him the team and i was like guys i feel like i feel like he might not be and i just like really like the guy because he's similar to me and we have like a lot of things in common so i feel like i would like working with him can you guys interview him and they were all like dude this is a hard note and i was like oh [ __ ] okay and so like i fall for it too and that's why it's really important of multiple people in the interview process and then the last one is kind of going with the similarity bias it's really the affinity bias right and that's when we feel a natural inclination towards somebody because of some random thing that we share in common so it might be a school it might be that we went to the same school we were younger we grew up in the same place we have the same color hair we've got a matching tattoo you know we have the same name even people with the same name like people more than people with a different name it's crazy and i've actually done this in the sense of there was a guy that you know we hired in gym launch who we had a ton of similarities in terms of like things that we liked how we worked things that we did and because of that i hired the guy and he literally had no idea how to do the job and so because of that i realized i was like oh i continue to hire people because i have an affinity towards them not because they're qualified for the job and i see this a lot with our portfolio companies and with companies that are you know between 3 and 10 million in revenue it's probably one of the biggest mistakes is just hiring people because you like them because you're familiar with them because you have an affinity towards them those are probably like the top three reasons why people hire people and i think that what is hard to get across to someone who's never had like a really great high performing team before is every time i've made the right hire and now i'm done with the five reasons but like this is just overall every time i have made the right hire i've been uncomfortable bringing that personal i have not felt amazing about the decision i've felt excited yet nervous and also sort of fearful because there's this unknown because this kind of person has different thinking than me they don't act like me they're very different than me and so because of that i'm not certain how they will act i cannot easily predict them we typically want to bring people on the team that we like because when we like someone and we understand them we think we can predict their behavior when you bring someone on who has diversity of thinking they think differently they have different experience they come from a different background typically we feel very uncomfortable because we can't predict what they're going to do or how they're going to act and so i want to tell you overall above all of this if you bring someone on and you're hiring someone and you actually feel slightly uncomfortable not because they're bad for the role but because they're unfamiliar to you or maybe intimidating or maybe because you feel like you can't predict them that is a good thing and so often in these situations it's a little bit of going against your gut because your gut's not going to lead you to building the best team your gut's going to lead you to building a team that's just a bunch of replicas of who you already are and so with that i hope that that video was useful for you this thing has been on my mind a ton lately because we've been doing so much hiring with all the portfolio companies they're all growing and you know kind of going past that you know hitting that like 10 million and now going to that 20 million mark and this is probably like the most relevant issue and so if you feel like again there's chaos on your team you can't get people to align they're not rolling in the right direction take into consideration if you're hiring correctly and if you're able to slow yourself down enough to look past these five biases and with that i will see you on the next one what's up guys thank you so much for watching my video and this channel i want to go ahead and encourage you to subscribe so you can find out when i have new videos that are releasing and if you really really like the videos uh go ahead and share with somebody else you know all right thanks and we'll see you on the next one