Naturally, the first step in the process is when a vacancy arises in your business.
However, before rushing to fill a position, consider the following points:
Do you know why the vacancy has arisen? Perhaps the previous employee left due to problems in the business and unless these are resolved, the new candidate will likely be unhappy too.
In these times, every cent counts so when a vacancy arises it is useful to consider whether you could manage effectively (not just scrape by) without that post being filled, or whether through job
redesign, or part-time work, savings could be generated.
As mentioned above, is there potential to appoint/promote an internal candidate to the vacant position and then recruit externally for the lower post? By promoting from within, where possible, you reduce the risks associated with recruitment but you also let your existing employees see that there is a potential ‘career path’ in your company which might encourage them to stay longer with you.
Once you have considered the above points, you can then reflect upon the second stage.