Staffing and Supply Chain

Hiring Considerations

Hiring and training the right people can have a significant impact on your business performance. In the previous module, we looked at considerations for hiring staff, staff types, and obligations of an employer. When deciding whether to hire staff, you’ll need to identify your needs by understanding the specific roles and skills required by your business and determine how much you can afford to spend on salaries and benefits. Financial considerations are covered later in this module.

Remember that you have options as to which type of staff you employ, click here for the overview of staff types from the previous module.

The table below outlines other key considerations when hiring staff.

Skills and experience	Look for candidates with relevant experience and skills that match your business needs. Consider both technical skills and soft skills like communication, problem-solving, and teamwork.
Shared values	Assess whether candidates align with your company's values, vision, and mission. Employees who resonate with your business's ethos are more likely to be engaged and committed.
Recruitment channels	Utilise various channels to attract candidates, such as job boards, social media, referrals, and networking events. Consider partnering with recruitment agencies or using online platforms to streamline the hiring process. Seek and LinkedIn are two popular platforms for job listings.
Interview process	Develop a structured interview process to assess candidates thoroughly. Include both behavioural and situational questions to evaluate skills, experience, and cultural fit.
Background checks	Conduct background checks, including employment history, references, and criminal records, to verify candidate credentials and ensure reliability.
Flexibility and adaptability	Look for candidates who are adaptable and willing to learn. In a small business environment, employees may need to wear multiple hats and handle diverse responsibilities.
Training and development	Plan for employee training and development to enhance skills and knowledge. Investing in employee growth can improve job satisfaction and retention.
Legal compliance	Ensure compliance with employment legislation and tax requirements when hiring employees. Seek legal advice if needed to navigate complex legal matters. This web page provides an overview of legislation relevant to employment relationships.
Benefits and perks	Consider offering competitive benefits and perks to attract top talent. These may include health insurance, retirement plans, flexible schedules, remote work options, and employee discounts.
Trial period	Consider implementing a probationary period for new hires to assess their performance and fit within the business before making a long-term commitment. If you intend to employ someone on a trial period, make sure you comply with the Employment Relations Act 2000. Read this Employment New Zealand page on Trial periods.

The Hiring Process

The process of hiring staff involves the following steps:

Conducting Interviews

To conduct effective interviews:

• Prepare thoughtful, job-specific questions that assess candidates' skills and experience.
• Create a welcoming environment to help candidates feel comfortable and encourage honest responses.
• Actively listen, probe for clarity, and evaluate candidates objectively against predetermined criteria.
• Provide clear communication throughout the process and follow up promptly with candidates after the interview.

A few key questions you can consider asking in your interviews include:

1. Why are you interested in this position?
   This helps you gauge the candidate's motivation and alignment with the role and your company.
2. What attracted you to our company?
   Understanding what candidates know about your company and why they want to work there can provide insights into their level of interest and cultural fit.
3. Can you describe a challenging project you worked on and how you overcame obstacles?
   This question assesses problem-solving skills, initiative, and resilience.
4. What do you consider your greatest professional achievement?
   This gives candidates an opportunity to showcase their accomplishments and strengths relevant to the position.
5. How do you prioritise tasks and manage your time effectively?
   Time management and organisational skills are crucial, especially in fast-paced environments.
6. Tell me about a time when you had to learn a new skill or technology quickly.
   Assessing adaptability and willingness to learn is vital, especially in industries with rapid technological advancements.
7. What do you see as your long-term career goals, and how does this position fit into them?
   This helps assess candidates' career aspirations and whether the role aligns with their professional trajectory.
8. Do you have any questions for us?
   Encourage candidates to ask questions about the role, company culture, team dynamics, or any other relevant topics. This demonstrates their engagement and interest in the opportunity.

Watch

Tips for Running a Successful Interview

This video provides tips for running a successful interview and includes a case study.

Expected Duration: 1:52 minutes

Employment Agreements

Employment agreements are legal documents that outline the terms and conditions of employment between an employer and an employee. The Employment New Zealand guide linked earlier has more information about this.

Part of a new employee’s induction is getting them familiar with the business’ policies and procedures. Policies and procedures help provide employees with a clear understanding of what is expected of them.

A policy is a formal statement or document that outlines the goals, principles, and guidelines governing a business' actions and decisions within a specific area of operation. A procedure is a set of step-by-step instructions or guidelines that outline the specific actions or processes to be followed in carrying out a particular task, activity, or operation within a business.

Policies are necessary:

1. To establish guidelines: Policies set forth the overarching principles, rules, and expectations governing specific areas of operation within a business, providing a framework for decision-making and behaviour.
2. For compliance purposes: Policies ensure that the business operates in accordance with relevant laws, regulations, and industry standards, reducing the risk of legal issues, penalties, or non-compliance.
3. To promote consistency: Policies help ensure consistency in practices, procedures, and decision-making across the business, fostering a cohesive and unified approach to achieving business goals.

Procedures are necessary:

1. For standardisation: Procedures provide detailed, step-by-step instructions for performing specific tasks or activities in a consistent and standardised manner, ensuring quality, efficiency, and reliability.
2. To control risks: Procedures outline protocols, controls, and best practices for managing risks associated with various tasks or activities, reducing the likelihood of errors, accidents, or compliance breaches.
3. For training and guidance: Procedures serve as valuable training tools for employees, providing clear guidance on how to perform tasks correctly and efficiently, facilitating onboarding, skill development, and continuous improvement efforts.

You may have policies and procedures that are linked. For example, a Health and Safety Policy establishes the overarching commitment to workplace safety and states the goals to achieve in this space. A Health and Safety Event Reporting Procedure outlines the specific steps to follow in the event of a safety incident.

Other examples of common workplace procedures include Employee Onboarding Procedure, Emergency Evacuation Procedure, and any procedures detailing how to use certain equipment or machinery in the workplace.

The key elements of a workplace procedure include:

1. Purpose: Provide a brief overview of the purpose and objectives of the procedure.
2. Scope: Describe the scope of the procedure, including the tasks, activities, or situations it applies to.
3. Definitions: Define any key terms or terminology used in the procedure to ensure clarity and understanding.
4. Responsibilities: List the roles and responsibilities of individuals or departments involved in carrying out the procedure.
5. Procedure: Outline the step-by-step process for completing the task or activity. Use numbered or bulleted lists for each step.
6. Documentation: Specify any forms, documents, or records that need to be completed, maintained, or submitted as part of the procedure.
7. References: List any relevant legislation, standards, or other documents that serve as references for the procedure.
8. Revision history: Keep track of any revisions or updates made to the procedure, including dates and descriptions of changes.
9. Approval: Indicate who is responsible for approving the procedure and the date of approval.

In the previous module we provided guidance for establishing and maintaining relationships with suppliers, which included regular communication with them. We also explored establishing and maintaining relationships with customers, which included the use of digital tools and platforms such as customer relationship management (CRM), websites, social media and chatbots.

To better understand supplier and other stakeholder relationships, let’s look at them in the context of a supply chain.

In business, a supply chain refers to the network of organisations, resources, activities, and processes involved in the creation and distribution of goods and services to end customers. It encompasses the entire journey of a product from its initial conception to its delivery to the final consumer.

Key components of a supply chain include:

1. Raw materials: These are the basic materials or substances used in the manufacturing or production process, which serve as the foundation for creating finished products.
2. Supplier: This is the entity that provides raw materials, components, or services necessary for the production of products.
3. Manufacturing: Manufacturers transform raw materials or components into finished products through manufacturing or assembly processes.
4. Distribution: Distributors and wholesalers are responsible for warehousing, storing, and transporting goods from manufacturers to retailers or directly to customers.
5. Retailers: Retailers sell products directly to customers through physical stores, online platforms, or other distribution channels.
6. Customers: The ultimate consumers or end-users of the products provided by the supply chain.

Your business may be anywhere in the chain from raw materials to retail. Some of your stakeholders in the supply chain may be overseas if, for example, you are importing raw materials, or exporting products. As a reminder, we looked at business premises, tools and equipment and advice for importing and exporting in the previous module.

The table below outlines considerations for supply change management and provides links to examples and more information.

Efficiency	Efficiency is paramount in supply chain management. This involves streamlining processes, minimising waste, reducing costs, and optimising resources to enhance overall productivity.  Leveraging technology solutions like enterprise resource planning (ERP) systems, inventory management software, transportation management systems (TMS), and data analytics tools can significantly enhance supply chain efficiency, visibility, and decision-making capabilities.
Visibility	Transparency and visibility across the entire supply chain are essential for effective decision-making and risk management. Real-time tracking of inventory, shipments, and orders helps in identifying bottlenecks and resolving issues promptly.
Collaboration	Collaboration with suppliers, manufacturers, distributors, and other stakeholders is crucial for ensuring smooth operations and meeting customer demands. Establishing strong relationships based on trust, communication, and mutual benefits is key.
Risk management	Supply chains are susceptible to various risks such as natural disasters, geopolitical issues, market fluctuations, and disruptions in logistics. Implementing risk mitigation strategies, diversifying suppliers, and having contingency plans are vital to minimise the impact of these risks.
Environmental sustainability	With growing environmental concerns, businesses are increasingly focusing on sustainability in their supply chain practices. This includes reducing carbon footprint, adopting eco-friendly packaging, ethical sourcing, and ensuring compliance with regulations and standards. Read this case study about how Taranaki bodycare company, Everkind, has reduced packaging waste and freight emissions.
Continuous improvement	Supply chain management is an ongoing process that requires continuous evaluation and improvement. Implementing feedback mechanisms, conducting performance assessments, and embracing innovation are key to staying competitive and adapting to changing market dynamics.
Customer focus	Ultimately, the goal of an efficient supply chain is to meet customer demands promptly and effectively. Understanding customer needs, preferences, and market trends is essential for designing a supply chain that delivers value and fosters customer satisfaction. Read this article about handling orders and deliveries.
Product safety	As raised in the previous module, ensuring product safety is a key compliance requirement. This can become more complex with multiple steps in the supply chain. NZS ISO 10377:2017 Consumer product safety – Guidelines for suppliers is a standard that can help your business ensure product safety regardless of its position in the supply chain. Watch this video for more information on the standard and how it can help. Visit this web page to apply for one of the limited number of free copies.

Watch

The Pure Food Co: On Building an Export Supply Chain With Digital

Watch this informative case study about The Pure Food Co’s supply chain and use of digital tools. This video provides te reo Māori subtitles.

Expected Duration: 7:22 minutes

Contracts

Contractual agreements with stakeholders are crucial for managing relationships and risks in the supply chain. They clarify expectations, responsibilities, and obligations, reducing conflicts and providing legal protections in case of breaches or disputes. Contracts also promote accountability and foster long-term relationships by formalising commitments and encouraging collaboration.

For an agreement to be considered a legally-binding contract it must contain the following elements:

1. There must be a clear offer made by one party and an unconditional acceptance of that offer by the other party.
2. Each party must provide something of value to the other as part of the agreement, such as money, goods, or services.
3. The parties must demonstrate an intention to be legally bound by the terms of the contract. This means that the agreement must be entered into with the understanding that it will be enforceable by law.

As a business, when reviewing or entering into a contract, several key factors should be considered to protect your interests and ensure the agreement meets your needs. The table below provides an outline of these factors.

Clear and specific terms	The contract clearly defines the rights, responsibilities, obligations, and expectations of both parties. Ambiguity or vagueness in the terms can lead to misunderstandings and disputes.
Scope of work or services	The scope of work or services to be provided, including deliverables, timelines, milestones, and any other relevant details. This helps prevent misunderstandings about what is expected from each party.
Pricing and payment terms	Where relevant, the pricing structure, payment schedule, invoicing procedures, and any additional costs or fees. Ensure that the payment terms are fair and reasonable and that there are mechanisms in place to address late payments or disputes over charges.
Term and termination	The duration of the contract and the conditions under which it can be terminated by either party. Consider provisions for early termination, renewal options, and exit strategies to protect your business interests.
Intellectual property rights	Where relevant, the ownership and usage rights of intellectual property (IP), including copyrights, trademarks, patents, and confidential information. Ensure that the contract includes provisions for protecting your IP and addressing any infringement or misuse by the other party. Your IP and the more general methods of protection were covered in the previous module.
Liability and indemnity	The liability provisions to understand each party's responsibilities in case of breaches, damages, or losses. Consider including indemnification clauses to protect your business from third-party claims arising from the other party's actions or negligence. Read this article for more information: The Power of Indemnification In Business Contracts
Insurance requirements	Consider including provisions requiring the other party to maintain adequate insurance coverage, such as general liability insurance, professional liability insurance, or product liability insurance, to protect against potential risks and liabilities.
Dispute resolution mechanisms	How disputes will be resolved. Read this article for more information: Guidance on dispute resolution clauses in contracts
Legal compliance	Ensure that the contract complies with applicable laws, regulations, and industry standards. Provisions may be included in the agreement that require both parties to adhere to legal requirements and obtain necessary licences, permits, or approvals.

As the articles linked above mention, it is strongly advised that you seek legal advice when setting up, negotiating or agreeing to a contract for your business. This is to ensure that your interests are adequately protected, and the terms are fair and enforceable.

Some law firms may provide a membership option as an alternative to paying hourly rates. One such law firm is LegalVision.

Summary

Hiring staff, establishing policies and procedures, and managing the relationships in your supply chain are all important aspects of business operations. Determining which roles your business needs to succeed and how you will manage supply chain relationships, are key parts of your business planning. Managing staff has been introduced in the previous module and will be explored further in the next module.