Why Indian Entrepreneurs Hire Wrong?

Every Indian entrepreneur dreams of going to the next level in business. But very few actually do it. Why? I will come to the reasons just in a while. But first let us figure out the ‘how’ part of it. Can the entrepreneur grow his business alone? Does he not need a team of leaders to lead the whole organization forward? How can he create a business scalability model that suits his organization? Does he need a coach who can guide them?

If you are an entrepreneur and are reading this, I know the first thing that will cross your mind is ‘Baharwala mere business ko kya samjhe ga?’ But ask yourself this first – ‘If I can manage my business all by myself and can take it to the next level, why am I not able to do that?’ Why growth did not happen in so many years?

In my experience of training more than 6000 entrepreneurs until now, I have often found it that entrepreneurs find it difficult to accept advice. For them ad+vice simply means adding more to one’s vices. The major barrier is lack of acceptance of the fact of someone else telling them what to do in ‘THEIR’ own business. They first need to break that glass ceiling, for any growth to happen.

Coming back to the ‘why’ part, there are many reasons why SMEs in India are not growing. But the one major reason which entrepreneurs fail to realize is that they do not have the right people to take their business where they want to. They surround themselves with people who, they believe and rightly so, are not competent enough to run businesses.  Notwithstanding, they hire misfits and face heavy mis-hire costs.

Most SMEs do not even contemplate hiring the right people because they lack the conviction of being the right company for them, or it is thought that they may be too costly. Even if they do, they do not think they can retain good talent.

Right recruitment is about hiring the right person for the right job at the right time at the right remuneration. The right person is the one whose aspirations are in sync with the goals of the organization, and whose attitude can be in harmony with his/her colleagues and with the spirit of the organization.

An interesting instance is that of ICICI Bank. During its early days, the company practiced rigorous hire and fire policy. The bank developed high expectations from its employees and started demanding unrealistic productivity. The bank was entrepreneurial in its approach and in its bid to be at the top, it fell prey to the same wrong employee practices that are typical of any start-up firm or SMEs.

The work environment had become very unfriendly and stressful, sometimes people were asked to work on weekends. With time, the workers grew unhappy with the employer and eventually there was an exodus of these employees to other, friendlier banks.


Over time, the company realized its mistake, and drastically changed its HR policies to ensure less pressure on employees and a good work-life balance. They realized that they needed to attract the right talents and retain them. Today their HR machinery works diligently to improve the recruitment process and ensure employee welfare. They learnt their lessons the hard way. That only great people make an organization great.

But SMEs are yet to learn their lessons on recruitment. Hiring the right people should be left to the HR department. However small the organization, in order to achieve growth there must be an HR department in the business, even if it be one person, as it has the talent of identifying the right talent. It has the know-how of finding such talent through various media, and identifying the person possessing it.

While recruiting, there are only two things of importance: capability and compatibility. When this duo is seen, there is a good chance of a right hire happening.

The interview of a candidate should be sufficiently long so as to sieve through his self-training for the interview. After he has exhausted his spiel, the real interview begins, and his talents and tendencies off-paper are as insightful as his academics.

Insights such as these have been shared in an audiovisual product R– Recruiting Right Resources, in SPEED4U-a product conceived and presented by me, and marketed by the Indian Institute of Learning & Development (IILD). Before I sign off, I wish you all the luck in assimilating and practicing what I have said, and bring about a radical change in how you hire. Remember, right people will take you where you want to be.

Leave a Comment

Your email address will not be published. Required fields are marked *