But first, some thoughts on the current business environment…
For those of you who follow me closely, you will note I have not written a blog in a long time. When Covid hit, it just did not seem to be the time to promote ideas about recruiting, hiring, and all things business that I cover in my blogs. What has been shocking to me is the pace of business…it has not slowed down at all for the tech companies we at Arnold Partners supports. Honestly, this has led to some degree of thriver guilt – to see so many fellow citizens (and in many cases very good friends) struggle in this K-shaped economy we are living in. In the direct world where I focus, the demand for CFO talent has never been greater. Tech IPOs are booming, which has a direct effect on the overall CFO market. As CFOs get drafted up into IPO companies, it frequently leaves a void somewhere down the food chain of the tech continuum. This has certainly had a welcome effect on our business and frankly has kept me from taking time to blog about this or that or the other thing. But now, following a brief respite, on with the show!
It is something we all muse about in both our personal and professional lives. Some of us actually try to do a bit of it…I still take a saxophone lesson every week, even if my skills seemed to have leveled off. I was taking Spanish classes when Covid hit, but those are on hold. It is especially important for me to always be learning. Whether a new skill or tactic, or perhaps even a whole new strategy around hiring.
I had an “Aha!” moment last year as I took on a fairly early-stage client needing a CFO. One of the clear mantras of the culture in the company was around continuous learning. Everyone in the company is encouraged and engaged in learning something new all the time. It could be how to juggle or how to improve listening skills. It does not matter as long as it is something outside of work that involves learning. When I met the CEO, I knew we were simpatico on that and immediately wanted to support him in finding an excellent CFO. (Which we did, and all went well!)
Learning a whole new approach to interviewing candidates…
The prospect of a taking a new tack for interviewing candidates was an entirely different kind of challenge. I mean, come on, I have been interviewing finance pros since 1992. I think I know what I am doing! Along came another client who had a VERY specific approach to the hiring process based on a book written in 2008. When they informed me of their dedication to this technique, I quickly got the book and read it from cover to cover. Three times. I went back with a highlighter to study certain elements of the process outlined. It was exciting. Some new ideas, some GREAT ideas and as it turns out, some really interesting learnings in the actual process with CFOs. Not as expected!
First, the positives:
The book gives a particularly good template to design a job spec that actually fits what it is you want to hire for. This may sound obvious, but I will tell you from experience, most companies take a spec off the shelf and maybe customize a line or two for their needs. By really thinking about what problems, you are trying to solve at the beginning of the process, it definitely makes screening candidates against a specific wish list of skills and experience for the exact needs of the client more effective. I have written about this before in a blog, “For CEOs and CFO Candidates: The Importance of an Exacting “Spec” in Executive Recruiting,” and the authors got it right.
The real aha in the book for me was around having various members of the interview team focus on different areas of expertise and skills of the candidates during the interview process. So often after a series of interviews candidates will tell me that everyone asked them the same thing. Or that they spent the first 10 minutes of the interview talking about something completely off subject such as a hobby. If there are six people on the interview team and each one spends 10 minutes talking about the same hobby, your interview team just spent a whole hour on it – not exactly productive! The takeaway is to have people on the team with specific skills or knowledge to hone in on those areas you are seeking in the candidate. Certainly, overall impressions are still made with each interview regarding communication skills, reasoning skills, presentation, listening, etc. So even tho each interviewer had a specific task, each contributes to the overall assessment.
The authors also offer a great litmus test to getting to a “no” on a particular candidate very quickly. Focusing on what the candidate’s recent former bosses say about them early on in the first call reveals whether or not their bosses have confidence in the candidate and will stand up for him/her.
Now the negatives:
The overall arch of the first five or six meetings as outlined in the book is heavily weighted to the company who is evaluating the candidate and offers very little opportunity for the candidate to ask any questions about the company, the role, or even the people they are meeting. In practice, this was a particular turn-off to CFOs. CFOs are data driven. They want to learn about and be sold on the opportunity as much as they like to show off their abilities to ask penetrating questions. We lost some good candidates that were totally turned off by this one-way approach. I think it may have something to do with the book being written in 2008. It was a buyers’ market for talent in 2007-2009. Not anymore. Not by a long shot. (Credit – when I gave the client this feedback, we altered the process a bit to give candidates an early opportunity to learn more about the company.)
Specific to my client, the first “real” interviews between the company and the CFO candidates after passing a 30-minute screen with the CEO were conducted by a very junior person on the staff. While this staff member is really well respected within the organization, the feedback from CFOs was basically they felt insulted and a real reluctance to continue the process no matter the outcome of the meeting. CFOs were telling me that spending an hour being grilled by a person with three years’ experience out of college sent a message that the company did not know what it was doing. (Credit – after a few of these meetings, the client heard the feedback and altered the process). I have another blog to follow this one about hiring a CFO and how much weight needs to be from “the team” (code for the people who would report to the CFO), the “executives,” and the CEO/Board. Stay tuned…
Conclusion on the book:
It was well intended. As with most business books there were a few good nuggets. I did take away some good learnings, both positive and negative. But to apply it literally to each hire was misplaced. CFO hires are unique. This hiring template was unique but the two were not really compatible. Fortunately, my client was open to feedback and we were able to alter the process and ended up making a great hire. If you want more details, please reach out…good to be back. More soon, Dave.