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Right Recruiting Newsletter 10/2006
Some recent assignments have highlighted differences between candidates who come from big companies and those with backgrounds in small companies. These differences are not obvious in resumes and are often not easily noticeable in interviews. While difficult to discern, a hiring decision made without evaluating these criteria can be disastrous. This is even more critical for positions higher up the organizational ladder. In many ways, the difference between big and small company attitudes is a combination of earlier business training, individual values and personality. Of course, not all people with similar backgrounds react the same way when changing employment cultures. We are talking tendencies, not laws of physics. Proper consideration of this important variable can avoid situations like "manager as empire builder" or "manager as gunslinger". The first is a classical example of the extreme big company manager – personal power as a reflection of group size. The second, an example of a small company manager unfamiliar with the corporate checks and balances required in a large organization. Fortunately there are some things to look for in candidate behavior that can improve your odds when hiring.
First, a confession of bias. A visit to our web site makes it very clear that most of our clients are small and mid-sized firms. Hence, most people who get this are managers at small to mid-sized firms. With that in mind, this discussion will revolve around a big company candidate fitting into a small company employer and not vice versa.
Secondarily, despite the differences between those who work in large or small companies, it doesn’t make anyone better or worse than anyone else. A bad fit is a bad fit, no matter which side of the divide the employer or employee resides in. This is not about good or bad character traits. It’s about good and bad job fits.
Let’s start with an anecdote. My neighbor John is the Chief Scientific Officer at a start-up biotech firm. A year ago, while talking at the gym, he mentioned the trouble he was having hiring a Regulatory Affairs Manager. He had just finished a frustrating two weeks of conversations with a candidate from Merck. In the interview, the fellow had expressed a desire to join a young, growing company. He said all the right things, yet, for the past two weeks, John had heard whining about how much more his company’s co-pay was than Merck’s and how much job security the candidate would be giving up. John said that the minute the Merck fellow received the offer from John, every subsequent conversation focused on the negatives and job minutia. The positives were ignored. Predictably, the candidate turned the job down and John hired something else.
So far it’s pretty standard. There is an addendum however, to the story. About six months later John’s company was purchased. I am not sure what made John happier, the $25,000,000 he pocketed from his options or his knowing that the Merck candidate who turned him down walked away from the $800,000 his options would have accrued for just 6 months work. I honestly think he wanted to call the guy and let him know how much that co-pay differential really cost him. Maybe he did.
In a nutshell, this is an example of a big-company set of values colliding with a small company world. John and his fellow employees joined the company with the idea of growing it, selling it and making money. A $5 or $10 co-pay was not all that important to them, nor were their day-to-day job responsibilities. To them the company was a vehicle to get rich. To the Merck fellow, an employer is an organizational chart to slowly climb. Despite the right words in an interview about entrepreneurship, the actions were not there. Not all situations like this revolve around the money/benefit equation. Some revolve around career growth and some around budgetary and infrastructure issues. However, I think it can be simplified like this.
Big company people focus intently on the job and package as offered. Small company people pay more attention to the company than the job, knowing that as the company grows their job will change anyway and they will see more money from that change. These prisms are very very different. In fact, it might sound simplistic to say that it’s the difference between an optimist and pessimist but there is a kernel of truth in that. I think big-company backgrounds foster a "make no mistake" attitude and small-company backgrounds reward risk that leads to growth. I know that every large company has posters on their walls imploring everyone to "Think Out of The Box" or to "Take Chances-Fly High" etc. A thin surface of entrepreneurial spirit does not make a culture. How people are rewarded throughout their careers is how a culture is created.
If you have worked at a large company you know that career growth can be a slow process. It has often been said that it’s a lot easier for a $50,000,000/yr firm to double than it is for a $1,000,000,000/yr company. Like a rising tide that lifts all boats, a growing company can lift all careers. People who have worked at large, corporate entities often have to wait for a boss to leave or retire for a position to open up. Once open, that position is a prize in a multiple internal candidate competition. In truth, that competition can begin years earlier, behind the scenes, when the whiff of a future opening is smelled. Career credentials are burnished and alliances formed. More important, with multiple internal candidates on the scene the promotion process can be more of an elimination process rather than a reward process. Let’s eliminate Sally because she messed up a report 2 years ago, lets eliminate Tom because he was late on a project last year, OK then let’s promote George, he has no blemishes. If that mental process sounds familiar, it has a name - The Peter Principle. Promotion till failure. The bevy of internal candidates for any one position coupled with the slow pace of promotion creates an uncomfortable mix for someone who has taken a risk and failed. Someone who has worked in staff roles in large companies has been trained to analyze job content and reporting structures to assure than their chances for failure are minimized. A lack of success is rarely punished. A clean record is the goal.
Small companies are different. Growth appears for different reasons. Maybe a new product is introduced or a new team is formed. Where there had been one person overseeing a group of vendors, we now expect that person the hire and manage 2-3 junior and mid-level people. Voila, a manager is created. Here is an example of just that situation, and some candidate responses.
My client was an electronics firm whose volumes had increased dramatically over the past two years. With an engineering department almost exclusively composed of EE’s and SW Engineers, the mechanical and manufacturing area was subbed out. Product volumes now justified a Mechanical Engineering presence internally. Initially, this person would have a very hands-on job but that would quickly morph into both project and personnel management as existing products are successfully tweaked and new products become ready to be released. A BSME with the right skills and attitude would move from design to project to department manager in 1-2 years.
Feedback from candidates was uncanny. Those who had experience in small and mid-sized firms saw it as a great opportunity - a growing company and a chance to staff a new department. People from large firms never even acknowledged that. All they said was it was too hands-on a job. These were all people who were at the same experience level who were doing almost the same job, albeit at dramatically different sized employers. Herein lies the danger for a manager, if interviewees see the opportunity that differently, how would a bad hire react to day-to-day company operations? Would one of the big company candidates who backed into the job rebel if asked to go over tooling drawings one hour too often in the day?
As a manager, how can you judge candidate attitude? Are you supposed to eliminate all candidates from the wrong size company? Of course not, but, it is a factor to consider, like quality of education or communications skills. You can use the interview process to look for trouble signs that might confirm the existence of a cultural disconnect. Here are some hints.
I am a firm believer that candidates most accurately reveal their true character in the offer/decision making part of the process. The back end is when the gloves come off and values are revealed. Obviously, that’s a problem because by then you are ready to hire. I’ll come back to that later but first, let’s look for clues in the interview.
Evaluate what questions the candidate is asking you. A few months ago I smelled a disconnect with one candidate for a Marketing job. I was filling a brand new position in a small growing company. I knew the company well, having filled over 10 jobs there in the past 2 years. I spent 45 minutes on the phone with a candidate explaining company history, ownership, reporting structure and job content and future possibilities. After my comments, I asked if she had any questions. Well, yes, she did. The first question was whether she would have her own office. The second was whether they had a dental plan. No mention of 4 straight years of 20% corporate growth nor were there any questions about the new product she was to support or what the personality of the owner was. Needless to say we went no farther.
This is an extreme example of how the interview can reveal what is truly important to the candidate in a new job. Most candidates are a little more savvy than that woman, or at least they play the game better. However, it’s the end game that can provide most of the information about a candidate. It shows their decisiveness or lack of it and their ability to understand situations from every angle. A skilled manager can exploit the negotiation process and buy time to evaluate the message the candidate is sending, not making a firm offer till his potential fears are allayed.
Let’s assume your top candidate looks good but you have some nervousness about whether they understand that working in small companies, like yours, requires a roll up the sleeve attitude. Mundane things need to be done in small companies and can’t always be pushed down the chain of command.
You are at the offer point. Here are some tips. See how the candidate makes a decision. You might want to explain that you need to formalize the offer, get some signatures and want to be sure they are ready to commit. Then ask, if you do all that and offer the job at xx dollars, will they accept and/or how much time will they need to make up they mind? A red flag might be an awkward pause on the other end of the line. A red flag might be someone saying they will let you know in 2 weeks. You get the point. If your top candidate has lost sight of the fact the idea behind an interview is to actually fill a job, they may not understand the pace of decision making at your firm. If their next question is to ask for a written job description to evaluate, as once happened to me, it is best to begin to disengage. After 2 interviews and 5 hours, if a candidate needs to see a written description of a job, you’ve got a big-company analysis in process.
If the candidate asks for more money, you might want to ask if that will seal the deal. If they want to analyze the benefit package, that’s fine, but when will they get back to you. The key here is to ask direct, what-if questions that require direct, concrete answers. This gets the candidate out of the interviewing skills comfort zone and into a real world where every decision and answer has a result.
The goal is the understand how the person thinks, not how they say they think. Remember, the fellow from Merck. He said he was entrepreneurial. His actions showed he wasn’t. A manager who is alert to clues in the interview/offer process can learn a lot from candidate behavior. The more important the job, the more critical it is to evaluate candidates in light of their judgment and career values.
Best of luck out there. In a tight labor market, hiring can be tough. Mistakes are harder to correct and every little tool can help. And, of course, remember Right Recruiting for all you hiring needs.
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