You’ll hear this common complaint in almost every gathering of small business owners: “It’s hard to find good people.” This phrase breaks my heart because there are plenty of skilled people dying to find a job in a company just like yours. Unfortunately, many small businesses miss the mark because they fail to use competency-based hiring.

It’s no secret it’s a buyers’ market for great candidates.

They are highly selective. The best candidates want a job where the culture fits their personality and they can excel. As a small business owner, you share this same goal: a high performer who fits your company culture. A competency-based hiring strategy allows you to attract the right people. And that makes hiring easier.

There are two types of competencies: (1) skills, knowledge, and technical qualifications, and (2) personality traits, behaviors, and attitudes. The first group is rather straightforward. Most of us can list the skills, knowledge, and experience needed. The second set of competencies is trickier.

Why? Because defining behaviors is hard. As humans, we tend to put difficult tasks at the bottom of our list. And we rarely get to the last items. When you are hiring people, that’s a mistake.

If you were buying expensive equipment, you would spend time reviewing key features and understanding how you could use them to make your processes faster, more efficient, or more productive.

Yet when it comes to hiring people, we fail to spend time thinking about the most important behaviors of a successful employee. That can be the most expensive mistake you make when you ignore competency-based hiring. Especially when the result is often a bad decision.

Defining behavioral competencies is surprisingly simple. However, it does take some careful thought.

Start by studying your best performers. If you don’t have any, no worries. Simply use someone you feel is a great employee from another company who you wish worked for you. Think about their attitudes, behaviors, and personality traits and how those traits contribute to their success. Then create a pie chart with the top three to five attitudes and behaviors. Your chart is a snapshot of your company culture.

Now do the same for your low performing employees. This gives you a range of performance from low to high.

But you have a little more work to do. This is where things get tricky. Your task is to take these behaviors and turn them into daily work activities.

Your next step is to specifically define those attitudes and behaviors in your company.

Words mean different things to different people so it’s critical that everyone has a common understanding. Use clear, concise, and easily understood language. Remember you are writing for your audience, who may have a different definition than you. You want two strangers to understand these behaviors and rate them in the same way.

Is this starting to sound like a performance review? It should because defining these behaviors is at the heart of effective performance standards.

Here’s how this might look. Everyone wants flexible people. So, what does flexible mean to you?

Create a chart like this for each key behavior or attitude. You can also include examples of words and phrases that your employees use. Get really specific. The more detailed the better.

Doing this exercise unlocks powerful insights you can use to attract high-performing employees. It gives you a solid foundation to craft Insightful Interview™ questions to confirm your candidates have these competencies.

Clearly defined competencies continue to pay dividends after you hire because they can be used for setting goals, creating career paths, professional development opportunities, and so much more. Plus, an added bonus is increased employee engagement and retention and reduced turnover.

A competency-based hiring strategy does require time on the front end. However, you’ll find the investment is one of the best you can make for your business.

Take the First Step.

If you still have some work to do, no worries. The important thing is you are ready to learn. Click this link to schedule a complimentary Insight session. It’s an investment of 20 minutes of focused coaching that will pay huge dividends.

You may also want to grab a copy of my book, The YOLO Principle: The Ultimate Hiring Guide for Small Business, available on Amazon. It’s a handy resource packed with tools, templates, and step-by-step instructions.