As we come to the close of 2013, I’ve noticed that business owners and executives that have managed to weather through the recession and come out of it a bit tattered but whole are starting to show signs of life. I’m getting more calls from companies looking to hire. They are feeling more confident and ready to start investing, including hiring in order to prepare for growth. They’ve made the decision to “professionalize”, or to be more specific, to bring in a new financial executive with a different set of skills relevant to the current direction of the company. To prepare for growth, these companies need more than just tactical individuals to implement and execute. They need individuals with leadership potential to help define the path to success. As a result, they are starting to look at more senior and strategic executives.
Unfortunately, in many cases the hiring of a senior financial executive is not always a simple task and often there is an inability to adequately define the role for this new position, as well as fallow recruiting skills.
Aftermath of the Recession
While these companies are looking to expand and grow, there remains the all too painful memory of the recession. One of the effects that I have seen as a result of the recession is the need for companies to run leaner and meaner. As a result, job requirements have changed. Both candidates and current employees are expected to carry more responsibility than may have been the case prior to 2008. Expectations have changed and so have the role definitions.
Because companies can’t afford to make a bad decision in hiring, and because there is a large candidate pool of worthy candidates, companies are tending to be much more specific about the candidates they want to hire. They have higher standards and greater needs. Before, a job listing might have been simply for a financial analyst at a director level. Now, the position has expanded to be a senior level executive that includes financial analysis as well as more HR duties, perhaps even IT, as well as developing the business plan. Companies are seeking individuals with more capabilities to fulfill a greater range of needs.
Afraid to make a bad hire now as they take their first steps back into growth from maintenance mode, companies are more thorough in defining the role and in vetting the individuals. It’s a two-step process that requires advance preparation.
Defining the Role
To define the role that they are looking to hire, they need to determine their priorities and objectives. They need to develop a specific plan and determine strategies to fulfill on the goals. Planning strategies mean different things to each business and the immediate goals differ. For instance, is the emphasis in the near term on budgeting and forecasting in the case of a potential financing event and so they need an individual with those specific skills? Or is the need in the realm of systems implementation to support an acquisition? Or are they preparing for an exit strategy? The first steps in defining the role for a senior level executive is to seriously and realistically consider your goals and what that individual is expected to contribute in order to achieve those goals. From there you can better define the specific skills and experience needed.
Vetting the Candidates
The most challenging piece in recruitment is finding the right people and determining the fit with your company, as defined by the position description and the culture. Some people may look great on paper, because they have been successful in similar roles previously. But a good tactician doesn’t always make for a good leader and senior level executive. For a senior executive, you are in need of a more strategic thinker. It’s important to ask behavioral questions rather than a laundry list of past accomplishments since it’s important to understand how this individual will respond to new situations that they may not have encountered previously. A seasoned interviewer is able to vet a candidate and determine their potential, not just the skills they’ve exhibited in the past, which is important to find a good senior level candidate to join the ranks.
Crossing T’s and Dotting I’s
In addition to defining the need and finding the best candidate, it is critical to determine the right incentive package and develop professional employment contracts. Again for a senior level executive, many companies are not experienced and knowledgeable in this area to develop an enticing offer. Without the proper package, companies can lose an ideal candidate or get themselves into legal binds through incomplete or unprofessional contracts.
Companies that take the steps to climb out of the recession and start investing in the business for growth through new hires will find themselves moving ahead in the market. While it’s scary to make the commitment to hire, done well it can give you a leg up on the competition.