Hiring the Right People and How IQ Tests Can Help: One on one with Mike Ford.
Pro Back Office (PBO), is well known for their superstar staff and offering quality accounting and finance services for more than 250 companies throughout the Pacific Southwest. Much of this is due to their hiring practices and being able to attract the smartest people in the industry. So how do they do this? What is their secret formula? How can companies learn from PBO and improve their hiring practices? This is an excerpt from an interview with Sage Software and Co-Founder & President, Mike Ford
When hiring a new employee, what are the top five most important qualities or skills you look for?
1. Performance Management - Level of Accounting skills & overall experience
2. Communication/dialogue skills (oral and written)
3. Teamwork – responsiveness, supportive
4. Integrity – ethical & honest
5. Innovation – proactive, embraces new ideas
How does the IQ test and essays play into your hiring process?
Smart people usually want to work with other smart people. Our IQ test makes sure that we hire smart people. We find that the lower the IQ of an incoming team member, the slower they are to pick up on new concepts or technology, even something simple like accounts payable may take them longer than someone with a higher IQ.
We definitely consider giving an IQ test to candidates something unique that only our firm does. In fact, of the hundreds of people that we have given IQ tests to, every single one says that this is the first time they have been asked to take an IQ test. Overall, it’s a fun test and people enjoy it.
Is there a certain cut-off point for the IQ test?
Ideally people we hire get over 110, but if someone is between 95-110 and do well on the other tests, such as the accounting exam, the verbal and written tests and the behavioral assessment, we would take those into account. We want people who are emotionally intelligent as well.
I really like how this is a unique part of Pro Back Office's hiring strategy. Just trying to garner a bit more about how and why the test is used.
The smarter someone is, usually the faster they are with picking up new ideas and technology. They are also faster at learner a new software. We need people who can hit the ground running, grasp new roles quickly and whom communicate effectively. By testing our incoming hires with various methods, we almost always ensure we hire A players. By hiring people that fit with our culture and appreciate what we offer them, we ensure high retention.
You mentioned innovation (being proactive and embracing new ideas) as a key skill you look for. How do you determine if someone has that trait during the hiring process?
We ask a series of questions in the form of a verbal behavioral test that they cannot plan for. The questions we ask are not normal interview questions. We can dig deeper with our questions and get to know who someone is. If the questions take them a long time to answer or they have a hard time answering them, they probably aren’t the right fit. If they fail our accounting tests, they aren’t going to be someone we can trust to put on our clients. If they fail our IQ test, they aren’t smart enough to work here.
How have the required skill sets evolved over time?
These skills and qualities have remained the same for years as they are important for the success of our business. A couple years ago we added a PBO accounting assessment to help better evaluate what level of accounting skills the applicant brings to PBO. We also recently started doing a behavioral assessment, asking questions that really get to the root of who someone is and what is important to them. My favorite three questions are “what would you do if you won $5 million, when was the last time you did something new for the first time, and what was the last book you read or movie you saw and why”. This helps you get to know a person better.
What is the biggest change you’ve seen in accounting/finance job applicants in the past 5 years?
There has been a shortage of superstar A players in the accounting field. Not as many applicants with public accounting experience and training which is always a plus. We come across quite a few people who want work-life balance and aren’t interested in 40 hours a week. These employees love coming to work for us and value the flexibility we give them. We don’t need people to work full time, in fact, some of our most productive employees only work 32 hours a week. This is especially great for working parents who prefer to work 9-4pm and can login at night once their kids go to bed. Also, employees are becoming more selective about working for companies who are making an impact. Fortunately for us, we impact small businesses in a very positive way by making sure they have financial transparency and key performance indicators that help them make better decisions.
How important is technical expertise versus soft skills (such as communication and collaboration)?
In our business, you need to have both. Communicating with the PBO internal team as well as the client is critical for success. Being a proactive communicator and someone that can relate to and understand others is crucial. We aim to hire people who are kind, caring and empathetic. We prefer people who are agile, emotionally intelligent and quick-witted. Being that we are an accounting, finance and operational superstars, technical skills are a must. Hiring people who have experience in numerous industries and various accounting software is very important. At the end of the day, we must possess the best of both worlds or clients will not hire us. And, once we are hired, we need to ensure a long-term relationship.
How have you seen the role of finance or accounting departments change or evolve over the past five years? Have these changes triggered a different approach to hiring?
This depends on the size of the business. The smaller companies will have a hybrid accounting/finance team where individuals perform both roles. Larger companies will have separate departments focused solely on accounting and/or finance. Yes, this does impact our hiring approach based on the size of our clientele. Someone who has been with a bigger company will be able to handle our more complex clients. Also, because companies are becoming more efficient with their cash, they tend to outsource more of the back-office functions. You no longer need a warm body sitting in accounting all day long. You can have a bookkeeper for only the hours needed to get done transactional accounting and a higher-level person to handle more complex things like cash flow forecasting, margin analysis and month-end close. By using an outsourced accounting model, you are hiring a firm that will give you the right people doing exactly what they are good at, at every level. You don’t have your CFO doing data entry and you certainly don’t have your bookkeeper trying to be your CFO.
What has been your biggest recruiting or hiring challenge, and how have you worked to overcome it?
Sourcing the right resources. We cannot have a bad hire. Our best applicants have been referred by business partners and friends.
Call us today to learn how we can help your business grow with the right people.