You are watching your newest hire work for their first 30 days and you are looking back at their great resume and 15 years of experience…and all you can think is, “Does he really have 15 years of experience or just one year of experience 15 times?”
It was this experience that led me to incorporate “hire for attitude, train for skills” as one of my company’s core values. As we tried to differentiate our CPA firm from our peers, we chose to have professional staff that could do 5 core areas of work instead of just audits or tax returns. Every time I would try to hire someone with experience, they would be competent in only one area out of the five. Since they also had “years” of experience, they demanded a premium pay that bore a poor relationship to profitability.
Instead of just passing on the cost to my clients of my paying too much for labor, I decided to solve the problem a different way. By growing my own talent, I would be able to keep access to our services more affordable and fulfill our mission of serving businesses between startup and $5 million in revenue. But, I would have to prove we could train people and stay profitable. We would also have to accept the slower growth curve that comes with growing your own talent.
The first step was to identify the 5 core areas we needed them to be competent in. For us, that was personal tax, business tax, accounting system implementation, financial statement preparation and forecast modeling. The next step was to identify the personality characteristics needed. Once we hired our prototype employee, we had to schedule the work for them to stretch but not break them.
We employed a 70/20/10 training philosophy that we told them when they were hired. 10% of your training will be classroom, 20% will be one on one mentoring and 70% will be throw you off the deep end of the pool to see what you can do. You will take a lung of water, but we won’t let you die. Until I throw them off the deep end of the pool, I do not know what they really can do.
When we started this process in 2003, I had just asked some partners to leave that were not aligned around this mindset and we were at breakeven profitability, down to 9 employees and $1 million of revenue. Up to this point, when we added an expensive person with narrow experience, we could see some growth but no real profit since they could not be used for more than one service offering and they were resistant to expanding their skill sets. When they would leave by our choice or theirs, we would start the crazy cycle all over again.
By 2010, we were on pace to do $1.8 million in revenue and had 21 employees and were on target for 10% pre-tax profit. The employee we hired as our prototype is still with us and is one of our top client managers. We had only one client manager leave to take a job with a client and only one new hire did not make the cut. Going from turning over 1 to 2 professional staff each year to turning over 2 professional staff in 7 years is a pretty good turn around. We have always had plenty of new business opportunities; our only bottleneck was how quickly we could add the right people. This process allowed us to peg our growth rate to our talent development rate.
Some of the best parts of hiring for attitude and training for skills are the fact that new hires bring no real baggage to the table, with zero bad habits to unlearn. We found that people really do love the opportunity to grow, and eagerness to learn will make up for their lack of so-called ‘experience’ again and again and again.