Actionable Strategies for Solving Accounting & Finance Recruitment & Retention Challenges
Our Knowledge, Your Playbook
1.4%: that’s the unemployment rate for accountants in the last quarter of 2019, according the Bureau of Labor Statistics. The unemployment rate for financial managers fell to 1.5% and financial analysts to 3.2%, all lower than the national unemployment rate of 3.5%. This means competition for top talent – or any talent – is tougher than it’s ever been.
As we look forward into a new decade, the urgency to hire top talent will only intensify. From changing regulations to fierce global competition to evolving Artificial Intelligence and technology, companies are grappling with disruption on every front. Organizations need strong professionals who combine technical and business skills to deliver objective advice, turning numbers into actionable insights, identifying new business opportunities and improving performance. This exceptional talent is in high demand and even shorter supply. Companies can no longer afford a “business-as-usual” approach to talent recruitment and retention. They must acknowledge that what worked a decade ago – or even five years ago – no longer gets the job done.
We understand that making any changes, even small ones, may feel like a dramatic shift. As calculated risk-takers, we like to take our time, carefully weighing the pros and cons before moving forward with a course of action. As objective decision-makers, we are not used to proactively “selling” a candidate on an open position or marketing our company. We also understand that when every day feels like a fire drill, there’s limited time to focus on one of the most important tasks: hiring great people.
This roadmap is designed with these realities in mind. It’s a guide to help your business objectively assess internal missteps and take corrective action. Think of it as your playbook forward for winning critical hires and ensuring your most valued talent is not vulnerable to competitor offers.
Talent Acquisition: How to Build Your Pipeline
Hiring great talent starts with finding great talent– and this starts with having the right recruitment team in place. Are you sinking too many resources into the wrong talent acquisition strategy?
When it makes sense:
Reaching out to your network is a natural first step, especially when the open position is on your team. You know the ins and outs of the position, including the type of experience and skills that would be most valuable. Most critically, you trust your network to give you an honest assessment of a potential hire’s strengths and weaknesses. You may also be able to leverage personal relationships to get a coffee meeting with a “dream hire” who isn’t actively looking for a new job but could be open to an opportunity at your company.
When it’s time to try a new approach:
Let’s be honest: trying to fill an open position yourself is rarely a strategic use of your time. Once you’ve put out the word to your network, it’s time to refocus on your key tasks.
When it makes sense:
Your internal team should know your business backwards and forwards. They should be able to leverage this knowledge and relationships with key stakeholders to quickly and efficiently fill openings.
When it’s time to try a new approach:
Consider your current speed to hire: are you filling open positions in a reasonable agreed upon time period, or are positions staying open for extended periods causing undue stress to the business? Internal recruiters are only as strong as their network, which is often concentrated in one vertical or is too general across a variety of functions. The average internal recruiter juggles up to 30 open positions at once. These positions stretch across multiple skill sets and require a deeper network than any one person can realistically provide. Failing to fill even a few open positions can have a domino effect, making life more challenging for everyone on the team, and ultimately driving your best and brightest out the door. Consider which positions are priorities to fill but remain open after several months. For most organizations, the benefit of filling these key positions outweighs any expense associated with outside support.
When it makes sense:
If you’re filling a high-level position or searching for a niche skill set, think strategically about potential recruiter partnerships. The right recruiter will be a subject matter expert in this field. Just like you, they’ll bring a deep understand of what it takes to be successful in this role. Critically, they’ll also bring the invaluable perspective of someone who spends all day, every day speaking with top professionals in your industry. This wealth of market knowledge and insight can help your business recalibrate its search approach, prioritize requirements, be realistic about available talent and deliver a competitive offer.
When it’s time to try a new approach:
Beware recruitment agencies that follow “spray and pray” tactics. In executive search, specialized recruiters should present no more than four or five candidates that have already been extensively vetted. If your recruitment agency is presenting you a laundry list of un-vetted candidates – putting the time consuming and resource-intensive task of vetting these candidates on you – it’s time for a new approach. In our experience, the “I just need resumes” approach rarely works– it’s a distraction leading to a frustrating end.
How a Recruiter Helps: Partnering with Internal Teams
Specialized recruiters typically tailor their approach to work open positions that are closely aligned with their skill set. This integrated, consultative approach means you have a team working across markets and industries, delivering the absolute best candidates for your business. Recruiters serve as an intermediary between the candidate and our client partners, and leverage this position to reassess candidate interest, potential concerns, and other interview activity at every step of the hiring process. A high-touch process limits the advent of uncovered information arising during latter stages of the interview and ensures a high rate of acceptance at offer stage.
The Interview Process: Where Companies Go Wrong
Interview processes can vary greatly between companies. Organizations have honed their approach to candidate screening, interview questions and even office tours or team dinners. Unfortunately, when stakeholders involved in the interview process are prioritizing different needs or not aligned to market realities, this causes confusion and increases the risk for decision-making paralysis. The longer a process drags, the more likely the candidate’s interests wane and an offer falls apart.
Small changes at the beginning of your interview process can strategically accelerate the decision-making timeline without compromising candidate quality. Start with aligning stakeholders to three key decision-making criteria:
1. Compensation and market value.
Candidates are fielding multiple, competitive offers. They know their value– but does your business? Are stakeholders at your company prepared to compete, or are they drawing an arbitrary line in the sand over compensation?
Watch out for “pennywise and pound-foolish” thinking. Landing a new hire is not about making a “good deal” on an employee but an investment in your company’s future. Focusing too rigidly on the bottom line or an immaterial salary gap could cause you to miss out on a true game changer. Top talent needs to feel wanted. If you spend too much time and energy splitting hairs over compensation, you risk losing this talent to a better offer. Even if this talent does join your company, they may be less engaged and motivated from day one due to protracted salary negotiations.
Employees are every company’s number one asset. Think of compensation as an investment in this asset, which is to be nurtured and grown, and not viewed as a pure expense to the Income Statement.
2. “Required” versus “preferred” skills and experience
Beware the perfect candidate trap. One reason the search process can run so long is that companies are looking for an idealized “perfect candidate” who does not exist. Avoid these pitfalls by setting appropriate expectations in advance.
This starts by prioritizing essential hiring criteria. An effective strategy for identifying requirements is to start by asking these two questions:
• What is the main problem this hire will solve?
• What skills will the hire need to solve this problem?
Next, we recommend dividing your evaluation criteria into “required” versus “preferred.” When your organization is fully aligned in advance on candidate requirements, the interview process will advance smoothly and on schedule. Aligning on requirements will also help prevent the perception that your organization “can’t make a decision” or “doesn’t know what it wants”– two red flags that can quickly alienate top talent.
For some companies, the hiring process is an exercise in “hurry up and wait.” They rush to collect resumes and then wait a month or longer to schedule an interview. Part of the reason for this delay is the inability to reach internal consensus over which skills are indeed required for the job, and consequently, which candidates should be interviewed.
Rather than rushing to start recruitment only to hit pause, try the opposite approach: take your time upfront and wait until everyone is aligned and ready to move forward. Establishing a timeline is critical and will vary based on the level of the position that you are hiring for. Be sure everyone is clear on the interview timeline: you don’t want a key decision maker heading off on vacation for two weeks in the middle of the interview process.
Remember, every decision maker who is added to the interview schedule increases process complexity and time requirements. Consider whether their role is truly a value-add or an unnecessary complication to the screening and interview process.
How a Recruiter Helps” Prioritizing Requirements
Technical skills like SEC/financial reporting compliance, internal auditing expertise and budget forecasting are in high demand. Finding a candidate who has the right mix of these technical skills, soft skills or leadership capabilities and experience isn’t easy. We can help your team avoid decision-making paralysis by prioritizing the most essential skills given what’s realistic in the market.
Be a Master Communicator
Don’t leave candidates in the dark: transparency and consistency are paramount for successful recruitment. When you tell a candidate you’ll be following up in three days but three weeks pass with no information, you’re sending a message that your company does not value the candidate’s time and is not excited about hiring them.
You may think that you’re being thoughtful and intentional, carefully vetting everyone before moving forward. Candidates think the opposite: “This company needs three weeks to decide between first and second round interviews– that’s a lot of time. I’m not sure if they know what they’re looking for in a new hire.” They may also think: “This company isn’t serious about making an offer. I’m not going to waste any more time with them.”
Companies that are willing to commit are also pursuing your top-choice hire. If you don’t want to lose this hire to the competition, you need to communicate clearly and decide promptly. If your timeline changes, let the candidate know. Candidates who are kept in the loop are more comfortable with a longer decision-making process. They feel they’re a priority to your company, increasing the likelihood they’ll be excited to accept an offer.
The Sell: Your Company, Their Future
Your company’s reputation – its “employer brand” – has a significant impact on your ability to recruit top talent, specifically passive candidates. Passive candidates are professionals who are currently employed but may be open to new opportunities– should the right opportunity come their way. Your employer brand is key to reaching these professionals. Think of your employer brand as your HR calling card: it’s what gets passive talent excited to learn more about career advancement opportunities at your company and consider interviewing. In fact, with a strong employer brand, these candidates may already be interested in working for your company before you even approach them, thanks to their familiarity with your company’s offerings, culture and benefits.
It’s easy for us to assume that a candidate is as excited about working for our company as we are, and to forget that top candidates are fielding multiple, competitive opportunities.
A strong employer brand may get top talent in for an interview, but you’ll still need to “show well” during the interview process to close the deal. Today’s interview process is not just about assessing a candidate’s qualifications and determining if he or she makes the cut. The candidate is also evaluating your company, determining if the current position and growth trajectory align with their professional goals. Show well during the interview process and your organization will be in prime position to secure your first-choice candidate.
1. Speak to the candidate’s needs. Consider how to market the role and your company by speaking to the candidate’s professional needs. Be sure to answer the “why do I want to align my personal brand with this company?” question. Highlight the opportunities that are most important to the candidate, such as meaningful work on specific projects, learning a new skill, or managing a team. Remember, top talent has their choice of where to work. Increasingly, these professionals are choosing a company or industry that aligns closely with their interests or values. Understand where your company falls in relation to your candidate’s career ambitions and personal passions, and be prepared to speak to these priorities.
List the pros and cons of the position. You’ll be prepared to sell the high points while also candidly discussing potential downsides, including how you will work with the candidate to ensure the risks associated with these challenges are mitigated. The best way to know which highlights to hone in on is to simply ask the candidate up front, “We’re talking so I assume there is something missing in your current role. Putting this position aside, what’s lacking and what are your objectives in finding a new role?” Then, listen!
2. Show well. Once you bring employees in for the interview, ensure their experience matches their expectations. Everyone involved in the interview process, from the interview team to the front desk receptionist, must be prepared to deliver a consistent message aligned with your employer brand. Reinforce what makes your company an exciting place to work and why this specific opportunity is the ideal fit for the candidate. Finally, help the candidate envision their future at your company. What is the promotion pathway like?
How a Recruiter Helps: Interview Intel
An executive recruiter’s job is to understand what a passive candidate is looking for in their next position. The recruiter can then speak to opportunities at your company and the specific role. For example, if the candidate is concerned about a promotion pathway or compensation, the recruiter can address these concerns behind the scenes– and let your hiring team know about the importance of speaking to them during the interview. This ensures when the candidate goes in for the interview everyone is on the same page and primed for success.
RETAINING TALENT: KEEPING YOUR BEST AND BRIGHTEST
Losing an employee is not just disruptive; it’s expensive. The cost to replace top professionals can be up to 213% of their annual salary, according to the Center for American Progress. Employee turnover is projected to cost US businesses a combined $680 billion in 2020, according to the Work Institute.
In today’s tight talent market, there are more jobs than people to do them. As recruitment becomes increasingly competitive, companies are eager to hold on to their top performer. Yet less than one in three salaried employees have been with their current employer for at least a decade. Turnover rates for accountants hit 13.4% in 2015 and continue to rise. Employees know they have choices and when their current employer misses the mark, talent starts looking elsewhere. A single departure can have a ripple effect across an organization, disrupting workflow, hurting engagement, and leading to more employees questioning whether they, too, might leave.
Successful retention starts with understanding the core reasons employees leave and then taking corrective action before the loss of key performers.
Why Do Professionals Want to Leave Their Current Companies?
Research finds the three top three reasons for employees leaving their jobs are: career development (21%), work-life balance (13%), and manager behavior (11%). These reasons all fall under one broad umbrella of why employees leave companies: Their employer is not meeting their expectations and needs.
The most dramatic finding is that employers could have retained 77% of employees who quit. These employees would have stayed if their employers provided better career development opportunities, better work life balance, or addressed managerial behavior concerns. Put it another way: these employees aren’t leaving solely over salary disputes. They were open to staying had their employers made a change.
These findings mirror what we hear from top talent every day:
• “The new office location doubled my commute, but management won’t offer flex hours.”
• “My manager expects me to sit at my desk from 9 to 5 every day, regardless of what’s realistic for the team or our clients.”
• “I’ve been in my current position for three years and there’s no growth opportunity– I’m not learning anything new.”
These issues may seem minor and it’s tempting for companies to dismiss them. We know that’s a mistake. These issues are symptomatic of poor employee experience. They suggest the employee doesn’t feel valued or connected to your company– and it’s no surprise these employees are open to opportunities elsewhere.
Work-life integration. Technology advancements mean employees can work from anywhere, at any time. Being present in the office still matters, but not every task requires an employee to be at their desk. Clock-watching managers who block remote work options or flex time will find their teams hemorrhaging talent.
Growth opportunities. Professionals who feel complacent in their current roles are a greater flight risk. Top performers want to be challenged and exposed to new learning opportunities. That’s why professional training is one of the most effective ways to retain employees. Employees who feel valued – their organization consistently invests in their development – are less likely to leave for another company where this commitment to development is unknown.
Consider the type of professional growth opportunities your team would find most valuable. Is this sponsorship to attend industry conferences, a formal mentorship program or ongoing education and leadership coaching? You don’t have to pay for every employees MBA, but you should prioritize investing in your employees. Companies who empower their employees’ career aspirations reap the rewards with more loyal, engaged and committed employees.
Compensation: Don’t Overlook the Elephant in the Room
Professionals know what they’re worth in this market. Your business needs to think about this value holistically. It’s more than just the salary–it’s the total package. This includes base salary and bonus, traditional benefits (health insurance, retirement funds, etc.), and “lifestyle” benefits. These are the benefits that keep top talent engaged at your company.
Do Counter Offers Work?
A top performer just gave you the news: they’ve received an offer elsewhere and are formally submitting their two-weeks notice. Is it too late for your company to keep them? In some cases counter offers can work, but this should be a tactic of last resort. When we place candidates, part of our job is to understand what motivates this candidate and what they are looking for in a new position. If the candidate is solely motivated by a higher salary, then we tell the candidate to ask their company first for the raise before interviewing at other companies.
Without going into too much detail about counter offers, it is important for us to point out that very rarely is a higher salary the primary motivator. A candidate is often looking for lifestyle benefits– a more flexible schedule, opportunities for professional advancement, a manager who gives them greater autonomy. In these cases, countering your employee’s offer with a similar raise may not be enough. Worse, even if the employee does accept the offer, you know they had one foot out the door– and you can’t assume they won’t jump ship in the near future for another opportunity. Work towards a reality where employees are engaged and not looking to leave.
About Lucas Group Accounting & Finance Recruitment
As full-service accounting and finance recruiters, we provide customized, right-fit hiring solutions and fully-vetted, game-changing professional talent that propels businesses forward. We engage top candidates through trusted referrals and long-standing relationships, employing a customer-first focus and discrete practices that protect client interests. Our executive search consultants and contract recruiters deliver the business-savvy talent needed to negotiate risk and compete in today’s dynamic and challenging business environment.