By Abby Lutte
You’ve heard it said many times: People are a company’s greatest – and most expensive – asset. For the growth-oriented company, reconciling the enormous value of human capital with the enormous cost of human capital will likely always require a delicate balancing act.
Up to 79% of CFOs surveyed by the CFO Alliance expected growth in 2015 – and also listed it as their greatest challenge. More than 57% of CFOs felt that investments in human capital would contribute to growth and yield high returns, second only to investing in improvements in customer responsiveness. Yet, recruiting and retaining top talent to enable growth in the modern, dynamically shifting functional area of finance is as difficult in the current hiring environment as it is imperative.
Hiring great finance employees used to seem easy. The best outside hires could be found – usually – through the trusty “gut check” of the hiring manager after a few interviews, a nod from HR and a handshake assessment. If it didn’t work out, there often wasn’t as much at stake. Roles were more insular, the pace of change was slower and skills could more easily be identified, transferred and sourced.
Somewhere between the “good old days” and now, complexity became finance’s bedfellow. In addition to the analytical and financial acumen required to achieve day-to-day competency in core functions, finance leaders grew to be trusted sources of strategic and institutional expertise. Now – with the explosive opportunity and challenges that globalization, speed and digital ecosystems have brought finance teams in the form of data and business relationships – it’s clear that hiring for the old days may help you get your team’s work done. But it won’t help you grow. “The responsibilities related to HR – managing performance, designing the leadership team for the next stage of growth and creating clear objectives for all employees – are just as important as having sufficient liquidity,” writes Robert Sher of CFO.com. It’s time to view finance leadership from a new, HR-colored lens.
Of course, there isn’t a formula for hiring your team of finance unicorns. Just as the gut check might yield you 50/50 odds of getting it right (if that), being overly formulaic or data-driven in hiring requirements takes the “human” out of “human resources” entirely – and you don’t want that either. What you want is a pool of highly qualified candidates and team members who do embody your organization’s values – but also think, act, learn, collaborate and lead in many different ways. Why? The world of finance is just getting wilder, bigger and more unwieldy. Diversity will help you ensure that the multiplicity of perspectives and skills required for growth is accounted for.
Although your path to hiring can and should be entirely unique, here are five perspectives on using a combination of the human and the data-inspired decision-making that may guide you on your path to finding the best of the best finance unicorns:
1. Ask, “What is our customer experience (really) like?”
You know your company’s books and numbers intimately. Your team certainly does as well. You also likely know what’s driving the numbers and how to share the information with the right people at the right time. In order to hire for growth, however, you need to understand not only the market dynamics and economics at play, you need to be fired up about your company’s mission and how it’s being played out beyond your remit.
For example, you would likely immediately notice a decline in sales on your flagship product. You might follow your first instincts to check inventory turns, supplier bottlenecks, resource allocation and margins – and these would all be appropriate. Yet, if you want to help your company grow and manage a growth-oriented team, you might go several steps beyond this to question the true reason why your customers are suddenly turned off. Is it that complex new sales compensation structure your company just implemented that left your sales force demotivated to sell? Did your product have a defect? Did a nasty Tweet become a PR nightmare? While you might be aware of any or all of these potential causes for sales declines, taking an active interest in them and deploying your team to listen and lead cross-functionally will close the gaps between silos and spearhead growth-oriented creativity. Your team might suggest the better sales compensation structure, provide a retention-focused cost/benefit analysis of defect actions, or offer funding options for a new PR campaign to get back on the right track. Hire employees who are interested in – and curious about – the customer experience and not just in their own responsibilities.
2. Ask, “What needs improvement here?”
You might be well aware of the gaps within your team’s processes. (It’s ok; most companies have them.) You might also know whether more funding, better technology or a larger team would solve the gaps. Yet while you are always called upon to approve and fund departmental budgets, tying financial and investment requests to cross-departmental strategy is a key skill for all your team members to have. Is your procurement department sourcing twice the number of current suppliers for next year? Beyond asking, “Can we afford it?” or “Does this help us grow?” you should also seek to identify the true “why” behind the request. It could simply be that your own manufacturing team is understaffed – an investment your team has the power to bring to light and perhaps change. Hire employees who can read between the lines and understand how decisions interplay with each other – and who aren’t afraid to bring new ideas to the table.
3. Ask, “How does my team need to adapt?”
Finance is increasingly being asked to keep one eye on the transactional and operational and one eye on the strategic. Naturally, this requires a broad base of skills across the team. You not only need functional experts, you also need leaders and generalists who can synthesize disparate pieces of information and enjoy collaborating with others, especially management. Take an honest look at what your team does well and what some of their challenges are. Do they consistently excel in accuracy and meeting deadlines but need help building relationships and deploying untapped skills? Do you notice a lack of communication or bottlenecks caused by poor processes? Depending on your organization, your team and the requirements of your company, your strategy for hiring will be unique. Simply remember that in order to grow, you need to ensure you have the right people in the right roles – and that adaptability, communication and comfort with data might be your greatest allies for helping to propel your company to growth.
4. Ask, “Do I have data to identify critical success factors?”
Using data to make decisions might come particularly naturally to you as a finance leader. In order to hire the best employees, it’s important to know what commonalities or requirements have worked in the past. For example, does experience in M&A seem to guarantee success in a leadership role? Does your compensation structure positively correlate to productivity and output? Do you notice superhuman accuracy when you pair your accounting teams in a specific configuration? It’s important to pay close attention to the past and present when hiring for the future, while employing a healthy respect for the value of diversity. Knowing that a system, quality or credential works wonders for your team will help you identify when just the right person comes along.
5. Ask, “How can I create a road map for my team?”
Just as you must to hire for the future, you must lead for the future. Help your team understand how their roles fit into your current plan – and collaborate with your team on a future road map, actively sharing information about how you will get there together. Help your reports see themselves working in new or more challenging roles with the right aptitude and grooming – and allow them to see how they fit in with the rest of the company’s strategy. Once they understand their own context and how they can move beyond their functional duties, engagement and growth orientation typically follows.
Of course a finance leader likely can ask many other questions when considering the next hire, the next promotion or the next transition. Hiring isn’t easy. Navigating the fuzzy, intuitive and subjective realm of hiring, recruiting and effective management takes a skilled leader who isn’t afraid to take cues from Human Resources, think in creative ways and leverage data to ensure that the talent pipeline is where it needs to be. In order to prepare your company to grow, ensuring that your perspective is outside-in, driven by curiosity and fueled by data and a love of collaborating with others will help ensure that your team has the flexibility and outlook to help facilitate the growth efforts of your company in a fluctuating environment.