When Your CFO Hire Goes Bad

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If you’ve ever had the misfortune of hiring someone through a recruitment firm who didn’t work out, no doubt you ascribed the blame to your recruiter. Which may be fair but then again, it may not be. After all, if you’ve been around for any length of time in business you’ve probably hired someone on your own, without the aid of a recruitment firm, who didn’t work out. Who did you blame then? Yourself? The person you hired?

Who Gets the Blame?

When it comes to most hires that don’t work out, there’s plenty of blame to go around and it could be equally attributed to the hiring authority, the candidate or the recruiter if one was involved. Usually a bad hire is the result of a lack of disclosure at the time of hiring. Sometimes, it’s willful, in which case one can blame the party that’s withholding pertinent information, and sometimes pertinent information doesn’t surface because the parties involved didn’t know what questions to ask each other, or often more to the point, themselves.

There are all kinds of variations on these themes, but here are the major reasons that placements go bad and how you can avoid these situations by teasing out information that hasn’t been disclosed during the interview process.

Four Candidate Red Flags

  1. Unemployed candidates will often accept a job very far from home in order to staunch cash flow problems. Once they’ve landed somewhere they’ll often move again within a year or so if a job much closer to home comes along. A variation on this theme is someone like a VP Finance accepting a Director of Finance job. They’ll often jump ship if someone offers them an appropriate CFO / VP Finance position in the next year or two.
  2. The candidate offers references from peers from previous employers and makes excuses on why they can’t provide references from their previous boss(es).
  3. The candidate has all kinds of justifications for their spotty track record (i.e. four jobs in the past six years) and swears that they’re ready to settle into their next job for years to come.
  4. The candidate asks no questions about the job, company, culture or particular challenges associated with the position during the interview process.

Three Things to Ask Your Recruiter

  1. How many references were done on the candidate and what exactly did previous employers say about problem areas or areas of development?
  2. How interested was the candidate throughout the interview process and did they require persuasion to go to the next step at any time? If a candidate needs a week to accept an offer, it’s usually a sign that they’re having serious doubts.
  3. Find out how the recruiter sourced their short list. If the recruiter says that the short list represents the best people available, ask them to verify that statement. Were the candidates people the recruiter happened to have on file or did they proactively recruit the candidates? If you lower your standards to accommodate less than ideal candidates, sooner or later you’re going to come down with a major case of buyer’s remorse.

Six Questions to Ask Yourself

  1. Are you in too much of a hurry to hire because you need to replace someone who had just quit?
  2. Are you really the laid-back, easy going, nurturing mentor that you think you are or are you actually a demanding, “my way or the highway” kind of boss? Not that there’s necessarily anything wrong with that approach; you should just let prospective employees know what to expect.
  3. Do you have a detailed, specific list of expectations of the position you’re filling and did you communicate those expectations to the candidate?
  4. Did you map the specific experience, technical skillset and personality traits necessary to succeed in the position to your expectations and did you ensure that the candidates you interviewed had that experience/skillsets/personality?
  5. Are you paying your new hire appropriately or are you taking advantage of the fact that they’ve been unemployed for twelve months and are willing to accept the job at a big discount to what they were earning before?
  6. Did you insist on at least two and preferably three detailed references from previous employers / bosses?

Avoiding the Unhappy Hire

As Tolstoy memorably noted in Anna Karenina, “All happy families are alike; each unhappy family is unhappy in its own way.”  If you want to avoid having to deal with an unhappy hire, make you sure you have all the relevant information you need before you pull the trigger.

If you think you may be in the market for top financial talent in the next few months, call me direct or email me, for a no obligation consultation.

(416) 567-7782 [email protected]

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