When contemplating staffing decisions for your firm, things such as timing, interest, philosophy, expectations, compensation, personality, and skill set all have to align for you to make a good hire. So how do you know which one(s) to focus on to ensure you make the best possible hire?
There are no "fool proof" proverbs in employee selection, but I have found that hiring based on the demonstrated efforts of the candidate is a leading indicator of success – and this includes the effort they put into the job search process itself! In a typical year, our team will review over five thousand resumes, and many are not worth a second look. Furthermore, there are the ones that tend to be filled with ambiguities, overstatements, and stretches, in general. For these reasons, hiring on the resume and interview alone can get a lot of firms in trouble.
Here a few examples of candidates we have recommended to firm owners (and who were subsequently hired) based on effort:
- One candidate submitted her responses to our mock financial plan exercise at 3AM on a Tuesday morning. It is not all that rare to receive candidate submissions in the middle of the night; however, we found out later that this particular candidate had a Retirement Planning class final exam scheduled for 1PM on Monday and Fundamentals of Insurance final scheduled for Tuesday at 11AM. When we asked this candidate why she took the approach she did, she simply responded because she was interested in the opportunities we had presented, and did not want to delay the process. Rest assured, we do implore candidates to focus on their courses, and only work on the requirements for our hiring process when they have time, which usually means once their course requirements are complete, but this was an exceptional candidate… as the effort showed!
- Another candidate submitted a very well done and accurate financial plan. This is a required step of our candidate evaluation and hiring process, and again, is fairly common to see. This candidate, however, not only completed the plan within the required software, but also downloaded a separate software suite, completed the same case again, and provided an analysis of the variances from the outputs of the two programs! Many candidates struggle getting one plan done, much less two. When we asked the candidate why they did so much more than what was required, the response was they wanted to ensure that the client received accurate advice, and they also wanted to build their skills to become more versatile.
- Lastly, a candidate who was working part-time, while taking a full load of college credit, completed our entire screening process in two days. To thoroughly vet candidates for firm owners, our process includes multiple interviews, a work style profile, financial planning-specific exercises, and more, which the candidate must complete on their own time; on average, it takes candidates 14 days to complete it all. Yet, in this case, the candidate not only got it done in 2 days, but plowed in without even asking what the typical timeframe was (as a lot of candidates do). When we mentioned the average timeframe after the fact, and asked the candidate what motivated her to complete the work so quickly, she answered that the exercises were challenging, and that she wanted to get a head start on the other candidates.
Unfortunately, these showings of effort are not typical (I wish they were!), and sadly, with today’s talent squeeze –lots of jobs to fill and few candidates to fill them – a good number of candidates are hired in our profession without exerting much effort at all. Only later do firms often realize and discover that when candidates don't exert more than the minimum during the hiring process, they are unlikely to go above and beyond in the actual job either.
For firms that do not hire often, making the right hire is critical. It is estimated that the financial cost of a bad hire is between 1-3 times the departing employee's salary, which oftentimes, does not even measure the intangible effects, such as detrimental impacts to culture, morale, and employee confidence. Firms that place more emphasis on effort over what candidates say about themselves verbally and on a resume will be better positioned for success.