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Hiring a team member in your business can be a wonderful step. It can be the step that finally gives you enough leverage to meet a goal that had previously been just out of reach: a specific income goal, capping the number of hours you work each day, or finishing a project.

It can also be a huge setback, if it's not handled well. Hiring mistakes result in lost money, lost time, and lost business. Anyone who hires will make some hiring mistakes–that's to be expected. But if you want to sidestep some of the biggest hiring pitfalls out there, and save yourself a bundle of money, time and sanity, make sure to avoid the following five mistakes.

Mistake #1: You don't know what you want.

Team members aren't interchangeable, even if they share a job title. If you lined up 15 different “virtual assistants” and looked at their skill sets, experience & resources, you'd come up with 15 completely different profiles. Some will be proficient with WordPress, others will be unfamiliar with it. Some will be experts in Infusionsoft but total novices with Mailchimp. Some will be stellar with customer service, others flourish behind the scenes.

So which one is right for your business? You simply cannot judge the fit of a potential team member by her job title. The only way to make sure you hire the right person for is to be clear on what you need.

Before you start looking for someone to hire, start by looking at your own preferences and needs. Get clear on that, and then look for someone who fits those preferences and needs.

Mistake #2: You're bargain hunting.

Do not–and I cannot emphasize this enough–DO NOT base your hiring decisions on who gives you the best deal. Furthermore, do not tolerate mediocre (or worse) performance from a team member simply because she's willing to work cheaply.

As Dave Ramsey said, I am not trying to get a great deal on a mediocre player; I would rather pay top dollar for a superstar.

Your team is a reflection of your business, so build your team the way you want to build your business. If you want a business that's known for its top notch service, products and systems, hire top notch team members. High caliber businesses are not built with low caliber team members… no matter how low their hourly rate may be.

Mistake #3: You've hired a friend rather than a fit.

Having the opportunity to build a business you're passionate about with a significant other or close friend is incredible, wonderful, transformative. If it works out that the skills + support you need are exactly what your SO or best friend specialize in, that's fantastic.

But that is also usually not the case.

Remember: The fact someone is a friend or family member does not magically imbue them with relevant business know-how, common sense, technical skill, marketing wisdom, customer service savvy, or any other quality you may be seeking in a team member.

Hire the person who fits your needs; do not compromise your needs for the sake of hiring a friend. If the fit and the friend don't happen to come in the same package–and they often don't–hire the fit, not the friend. To do otherwise not only jeopardizes your business, it usually also spells the end of the relationship.

Mistake #4: You're nitpicking.

If you're micromanaging and nitpicking, you're not truly delegating. Micromanagement and nitpicking are symptoms of someone who's delegating in name only. In spirit, they're clinging tightly to the tasks they're ostensibly assigning to their team member. Doing that will only wind up costing you money and time, and will frustrate the dickens out of your team member.

If you cannot trust your team member to do the job they've been hired to do without your micromanagement or nitpicking, you've hired the wrong team member.

[Sidenote: About nitipicking, here's why we do it & a couple of stop-it-in-its-tracks questions.]

Mistake #5: You're not allowing for a learning curve.

No matter how brilliant and competent the person is, any new hire will have a learning curve: a period of time when she's getting up to speed on the inner workings of your business, how you like things done, and the systems you use. You won't be able to hire someone today and jet off to a desert island tomorrow, and just expect things to run smoothly.

Your new hire will need some “get up to speed” time. Accept and expect that.

That said, don't let a learning curve become accepted mediocrity. If after a couple of weeks it's evident that your new hire's learning curve isn't progressing, you may need to cut her loose and find someone else.

Mistakes happen… but now you've got 5 you know to avoid.

I don't hope that you'll be flawless in your hiring. You won't be, and if you were, you'd miss out some valuable lessons and a-ha moments about your business and yourself. But I do hope that your hiring will be generally smooth, cost effective, and perhaps even pleasant. Making sure you avoid the five mistakes above will go a long way to making that happen!