Tuesday, January 27, 2009

Inbound Recruiting: How To Find the Best

I read a great interview with Mike Volpe of Hubspot.tv that got me thinking about inbound recruiting. Mike and Hubspot are really on to something with his efforts with inbound marketing.
Outbound marketing – cold calls, TV ads, email list rentals - is becoming less and less effective because people are becoming better at blocking out those channels with tools like caller ID, TiVo, and spam blockers.
Why should it be any different with recruiting. Think about it. Here's how traditional recruiting works. Company is in need of a CFO due to turnover or growth. They contact a few of their CEO colleagues, but none of them are going to refer their CFOs. So, they contact a recruiter. Why? They just don't have time to wait on newspaper ads, responses, and resumes; plus screening, scheduling interviews and so on. Furthermore, recruiters have already sourced candidates, screened them, and know who would make a good fit.

The company tells the recruiter we need a CPA with 10+ years of experience, preferably with public accounting experience, and here's the price range we are looking for. But really what the CEO is looking for is the best CFO in the world. Wouldn't it be nice if the CEO could just Google "best CFO in Louisville" or "best CFO in small business" and, voila, a Google first page of the best candidates? Why not?

Better yet, what if CFOs, HR directors, marketing directors, or anyone for that matter, could get CEOs and small business owners to subscribe to their blog, add it to their RSS feed, and check it regularly? What if they actually found value in what you have to offer and read regularly? What if they started following you on Twitter, LinkedIn, and Facebook? What if they actually sought you out and said I want you on my team? They may not be looking for a CFO right now. That's fine, because I'm not looking to leave right now. Recruiting is all about fit and timing.

I love my job and I love the company I work for. However, as the CFO Coach, Cindy Kraft writes,
No job is secure forever. Not even the CFO role. If you are employed, now is the time to create your career protection plan to help ensure a smooth transition to the position you want, when you want to make the move. ... Your marketability is highest when you are gainfully employed with a clear marketable value prop.

Wednesday, January 21, 2009

Integrating Social Networking With Traditional Networking

One of the aspects of social networking that appeals to me is that it starts with listening. Whether you are on Facebook, Twitter, or LinkedIn, it starts with following a couple people. One sort of dips their toe in the water, with a couple of posts, but primarily watches what others are doing to get a grasp of what it's all about. I am most active on Twitter where I follow over 150 people, so I am reading (i.e. listening) much more than I am writing. I am amazed how much one can learn through a series of 140-character tweets.

Last October, I took my social networking offline and went to Let's Tweetup, a quarterly get-together for Twitterers in the Louisville, Kentucky area. I had no idea what to expect and had never met any of my following/followers in person. I really enjoyed meeting people I'd been following such as @JasonFalls, @DavidFinch, @MelissaKing, @bdthomas and of course @earwood who organized the event. I also met a couple of people who I had not been following such as @ismitley.

Going into the evening, I already knew a little bit about those I had been following through Twitter and that made conversations much easier to start and maintain. Throughout my career as a Louisville CPA, I have attended numerous networking events. Most of the time, I tend to connect with those with whom I already have a connection. I have made new connections, but they tend to be short-lived, because I fail to follow up. That's where social networking fills in a missing piece of the networking puzzle.

The second key to integrating social networking with traditional networking is, to use the marketing term, touches. Traditional networking serves as a meaningful touch with those who one has not seen in a while, but how many events can one attend monthly? Unless one is diligent with following up, then the touches become few and far between and the connection withers. Social networking provides a vehicle for connecting much more frequently and effectively than using events, email, or telephone. Social networking is much less intrusive because it is opt-in. Reading this blog, for example, is an opt-in strategy. You chose to click the link. I am not junking up your inbox or interrupting you with a phone call.

In order to maintain meaningful connections with one's social network, it becomes imperative to take it offline periodically. The value that can be added via text becomes limited at a certain point. There needs to be the face-to-face interaction where one can experience facial expressions, tone of voice, personality, and emotion. Since the Let's Tweetup, I have met in-person with several Twitterers and came away from the meetups even more impressed with the the business-savvy, intelligence, and entrepreneurship of my social network. There is a networking circle of listen -- touch -- connect.

My next opportunity to take it offline is the Louisville Geek Dinner this Monday, January 26, 2009. I scanned through the list of attendees and was pleasantly surprised to see people who I know outside of my social network. Maybe I can get them into my social network and the circle continues. I hope you join me and over 100 other people this Monday.

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Tuesday, January 20, 2009

One Easy Way to Protect Against Employee Theft

Last week, I presented a very brief overview of the Fraud Triangle. One easy-to-do way to minimize opportunity and deter employee theft is to have your company's bank statements mailed to your home. Call your bank and change your mailing address to your home. With some banks, you may even be able to do it online. It only takes a couple minutes. Just do it.

I remember a fraud case that nearly put one of my tax clients out of business. His trusted bookkeeper of over twenty years embezzled thousands of dollars by simply writing checks to herself. After processing payroll, she would write a check to herself instead of to Uncle Sam. Needless to say, the owner was shocked when he received a very ominous notice of back taxes, penalties, and interest from the IRS. Fortunately, I had an incredible payroll tax accountant who worked with the IRS to schedule payment and reduce interest. And my client had very loyal vendors who gave him enough breathing room to raise the needed cash.

Many small business do not have the resources to segregate duties among employees. Oftentimes, the bookkeeper processes payroll, accounts receivable, and accounts payable. This individual writes checks, signs checks, issues credits, and balances the bank statement. This creates ample opportunity for theft. If you care about your employee, you will reduce this opportunity for theft to protect them in the event of some perceived need they may encounter.

Receiving bank statements at your house is one of the most effective means to reduce opportunity. At a minimum, open the statements and take them out of the envelope before giving to your bookkeeper, controller, or CFO. This at least gives the appearance of looking through them and takes less than a minute.

The next level of scrutiny only takes a few minutes depending on the number of transactions. Glance over the checks to make sure there are consistent signatures and the check is not written to the person who signed it. This person should under no circumstance sign a check written to them, to the company, or to cash.

Take it to the next level and read each check. To whom was it payable? For how much was it written? Is it about the same as last month? Are there any vendors you don't recognize? After a couple months, you will get very familiar with the statements and you will get more and more efficient at reviewing them. Generally, the amount and vendors do not fluctuate significantly from month to month. For example, your rent, phone, utilities, and insurance are paid each month to the same companies for about the same amount. You will be will quickly scan these and any thing unusual will stick out like a sore thumb.

Finally, when you hand the statements to the bookkeeper, ask questions. Pick two or three highlights. I noticed gas went up quite a bit. Did they increase rates or is it due to the temperature dropping so much? I noticed a big check to Staples. What office supplies did we buy last month? Have we used so-in-so plumber before? You'd be surprised what you learn by simply asking the question.

Tuesday, January 13, 2009

The Fraud Triangle

The 80/10/10 adage states that 10% of the population is as honest as the day is long. They will not lie, cheat, or steal no matter what the circumstance. Another 10% are crooks and should be behind bars. The other 80% of us, given the right opportunity and the right circumstance will behave unethically. It could be fudging a timesheet, stealing office supplies, or embezzling money.

I need this box of pens for the church auction. They won't miss them. It's for a good cause. I need some more cash for this unexpected medical expense. I'll pay it right back; I'm just borrowing the money. I'll use the company credit card for dinner tonight with my wife. I've work my butt off this month. It's the least they can do. I deserve it.

These statements illustrate the three tenets of the fraud triangle: perceived need, rationalization, and opportunity.
  • Perceived need - Perceived need is often created by expensive addictions such as substance abuse, sex addiction, gambling addiction, and spending addiction. Companies are limited in how much they can prevent this. However, companies should be aware of changes in behavior and spending that may raise red flags. Not to trivialize it but remember the four 'Bs' of perceived need: Beer, Boobs, Betting, and Borrowing.
  • Rationalization - Never underestimate the ability of the human mind to rationalize anything. The criminal mind can actually rationalize a crime as being a benefit to society. Infamous fraudster Frank Abignale bragged in his book, Catch Me If You Can, that he only bilked large corporations and not individuals. He was doing them a favor by exposing their weaknesses.
  • Opportunity - This is one area that companies have the ability to control. Opportunity is the means to steal whether it be leaving the supply closet unlocked or an inadequate system of internal control and segregation of duties.
A recent survey found that executives are concerned about the rise of employee theft during this economic downturn. Small businesses reported fewer incidences of employee theft. The data suggest that employees who are part of a cozy group tend to think twice before stealing. What is your company doing to deter employee theft?

Wednesday, January 07, 2009

How to Conduct Annual Employee Reviews

This is a summary of the above titled article from Inc. Magazine December 2008 print issue, Inc. Guidebook Vol. 1 No. 9.

1. Set benchmarks early
  • It starts with the job description that includes responsibilities and competencies.
  • Set SMART goals (specific, measurable, achievable, realistic, and time-bound).
  • Make it personal. Set goals that also further an employee's personal goals.

2. Develop the process
  • "Virtually all HR experts say a performance review must not be an isolated event but should cap a year of regular meetings."
  • "Managers must continually communicate with their employees," says Courtney Berg of Corteide Consulting in Broomfield, Colorado. "There should be no surprises when you sit down with employees at review time." (I've said this before.)
  • Have periodic reviews at least quarterly. These are not as formal, but include taking notes and a performance log.
  • The annual review should include an evaluation form that is tailored to your company with three- or five-star rating system and space for comments.
  • Start with a self-appraisal so the manager will know beforehand if there is an area of disagreement.
3. Hold an effective meeting
  • The review should last 40 minutes to an hour, without distraction or interruption, and be in a comfortable environment without a desk between you and the employee.
  • Start with the goods news, if there is bad news to deliver.
  • Strive for objective judgments instead of subjective. Focus on specific behavior and recommend alternatives.
  • "The meeting should close with setting goals and expectations for the next year."
  • "When employees walk out of the performance management review," says SHRM's Miranda, "they should feel energized that the boss appreciates their strengths, values their contribution, and sees their potential."

Tuesday, January 06, 2009

My Goals For This Blog

My goal for this blog is simply to be this best CFO on the world. That's an audacious goal, but as Seth Godin points out is his book The Dip, both best and world are subjective. Is your world your community, your company, your industry, your city, your state, etc? Even CFO can be subjective. The role of a CFO for a small business is vastly different from a large business and the CFO for a professional service company vastly different from a manufacturing company. Mr. Godin goes on to write that "you are the best in the world, if you want to be."

How does writing a blog help me become the best CFO in the world?
  • Improved communication - Writing is a communication skill and communication is essential to leadership. My writing tends to be step-by-step how-to's or emails. Blogging requires forethought and organization. There is a skill in taking an concept, breaking it down, and communicating it to an audience.
  • Life-long learning - Can you teach others what you just learned? There is an adage that the best way to learn something is to turn around and teach it. This blog is a means of reinforcing and applying what I have learned.
  • Personal growth - Are you a better person today than you were yesterday? Blogging provides an excellent medium for personal reflection. There something about putting a thought to writing that really clarifies the thought.
  • Better Time Management - Do I really have time for another hobby? When responding to someone's gasp after announcing she was pregnant again, Kimberly Hahn quipped, My children take up all of my time so another can't take up anymore. Anytime we decide take on another responsibility or goal, be it exercising, blogging, or children something's got to change. That forces one to either give up bad habits, become more efficient, prioritize better, or learn to delegate. Do I really need to watch that TV show, or finish that poorly-written book, or click just one more link?
  • Stress Relief - Blogging is fun. I enjoy reading, learning, reflecting, and writing. And it is much better mental activity than sitting in front of the boob tube.
  • Personal Branding - Does the web know who you are? If you are reading this, then you are on the web. If you are on the web, then you have a brand. The question is, do you have control of your brand? If not, you should.
  • Networking - One of the comments below reminded me of this crucial benefit to blogging. Cindy Craft said it well, Network even when you don’t “need” to be networking. Your network is never more valuable then when you are in a position to help others ... because that earns you the right to ask for help when you need it. (updated 2009/01/07)
This is my short list of why blogging is beneficial. Why do you blog?

Related articles:
Top 6 Tips to Recession-Proof Your Career
27 Blogging Secrets to Power Your Community

Thursday, January 01, 2009

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About

Mike Campbell, CPA is a CFO in Louisville, Kentucky. Mike is a principle-centered leader with a proven ability to execute. As the CFO of a fast-growing small business, Mike understands the importance of cross-functional communication and works effectively to acheive the company's vision and goals. As a member of the Senior Leadership Team, Mike provides the CEO and the leadership team the tools, resources, and analyses to make better decisions.

Mike optimizes processes and infrastructure to strengthen companies while keeping costs down. Mike achieves this through technology integration and strong leadership.

Prior to his current position, Mike has ten years of public accounting experience performing financial audit and preparing tax returns for a wide-range of companies in multiple industries, including insurance, healthcare, manufacturing, and school boards.