In a Q2 2015 survey of CFO’s conducted by a global consulting firm, nearly two-thirds of participants sited challenges attracting talent into their finance organizations. Finance professionals wrestle with some of the most daunting challenges in the workplace; however, managing talent is likely the most complex of their many responsibilities. Attracting and retaining top talent, while at the same time running a lean finance organization that commands consistent peak performance presents quite the conundrum. If you’re not CFO of a dot.com with in-the-money stock options to offer current / prospective employees, you might want to read on…
As anticipated in a prior Levelx Insight, the market for highly-skilled labor is beginning to rebound and power is shifting from employer to employee. This shift is evidenced in the offering of more robust Employee Benefits offerings by such companies as Netflix and in the recent wave of corporate headquarter relocations from suburban locales to the urban core in search for young talent. Leaders who’ve paid attention to authors like Jim Collins (Good to Great, 2001) recognize long-term success is predicated on a company’s ability to attract, retain, and effectively deploy talent. Or put another way, having the right people on the bus and in the right seats.
We offer three considerations for CFO’s in the driver’s seat of the bus:
1. Don’t rush the recruiting/hiring process
Hold for the right hire! Turn-over can cost upwards of 9 months of salary (or $60,000 for a position earning $80,000 per year) in incremental recruiting and training expenses. This does not include the impacts of lower productivity among remaining employees, the critical company knowledge that leaves with the departing employee, and the diminished morale among remaining employees who have to multi-task to cover the work of the open position. Making the wrong hire, in an effort to fill an open position quickly, can make a problematic situation worse. Instead, consider retaining an interim resource to fill the gap. The interim resource will help keep the wheels on the bus and afford Finance and HR the time to partner and execute a thorough search which results in the right full-time hire. Leveraging such solutions; those which facilitate the talent transition and replacement process, will pay significant dividends.
2. Document and cross train
Raise your hand if you can identify a co-worker for whom a) no one in your group knows exactly what they do, and b) their role has never been documented but the outputs of their work are critical to your department. For example, this team member owns a crucial reconciliation or is the only one who understands the financial model which produces some of the entries required for the financial close. If your hand is still raised, do know that you’re not alone. A number of our past clients have faced this dynamic: a role or set of roles, critical to the finance function that are not fully documented and for whom there is only one person on the team that has a complete understanding of the work. Prudent finance leaders, even those in private companies that have no Sarbanes compliance requirements, make it a point to document all of their key processes. Further, they invest the time to architect rotational programs which allow finance and accounting resources to experience [or cross train in] all aspects of the function. In this way, these leaders reduce the risk of “brain drain” when that obscure team member who owns the XYZ costing model walks out the door.
3. Move quickly on underperformers
Like leaking water, by the time you see signs that you have an underperformer on your team, it is likely that they have already destroyed value in areas less apparent to you — whether by building errors into work product and tools, bottlenecking key processes, or by compromising the finance organization’s brand among internal customers. The typical finance mantra of doing more with less can actually work against finance leaders in such circumstances wherein the standard reaction is to keep the underperformer for concern that the already over-worked team cannot afford to lose the extra support. Instead of allowing the underperformer to languish and risk the ill-effects of their poor performance spreading like cancer, we suggest you quickly work to resolve the situation by: a) confirming your suspicions with objective performance feedback from other parties; b) developing a performance improvement plan with objective and measureable performance targets as well as a definitive timeline, and c) being decisive at the close of the evaluation plan period. It is important to engage HR early in the process to ensure you’ve followed all necessary protocols, as well as to commence the replacement search process as early as possible. And finally, consider bringing in an interim resource to fill the gap left by the outgoing employee. Remaining team members will appreciate the additional support and will greatly value you being proactive in returning your wayward bus to the center lane.
The strategic, tactical, and personnel challenges facing finance leaders will get worse before getting better. Reach us if you’re interested in learning more about some of the innovative solutions we’ve designed to stay ahead of the game.