How do you recruit strong financial modeling skills in your team?
BACKGROUND
Not too long ago I was the leader of a finance team in a large organisation.
One of the many challenges as a leader of any finance team was hiring new talent. But not just any talent or skill, I was after strong financial modelling (“FM”) skills and problem solving/lateral thinking.
My team were supporting the finance business partners in adding value to the business. I had been a finance partner so I had a reasonably good idea the sort of talent we needed and we didn’t have a lot of it
I even got some of the finance partners to interview the candidates, but after I had filtered to ensure the candidate had FM skills. Just to make sure they were happy with who we were hiring to support them.
So how did I solve this skills gap and how might you learn from my experience.
Hiring a gun financial modeler is easier than you think today too, if you read below.
STEP 1.
Make the decision to hire based on the way people think and communicate not what it says on paper.
Especially what is stays about where they have worked or what qualifications/memberships they might have.
STEP 2.
Make them prove it first.
Get them to build a financial model based on assumptions you give them on the business they are supporting.
No model, no interview.
I did this and I immediately saved myself bucket loads of time as people self selected and pulled out before their first interview.
They lacked the confidence to solve something they weren’t familiar with. Nobody had ever asked for this before an interview and it scared them as they felt exposed.
Check to see if they naturally built a 3-way model, but don’t specify that requirement.
If they did without promoting that’s a really good sign. If they didn’t (which is likely to be the vast majority), after the interview request a resubmission of a 3-way model before agreeing to hire them.
Can they problem solve? You will soon find out.
STEP 3.
Make sure they can explain what they did (high level) in their first round of interviews and what they found challenging.
Ask questions like:
Explain some of the more complex logic that was required.
Why they didn’t build a 3-way model only PL (which was a lot of them in my case).
How did they go about building the model?
What insight did they gain and actions they might take to drive performance based on the model.
Ask them to explain this as if you were the business owner.
STEP 4.
Make sure your team and key stakeholders like them in the next round of interviews.
Can they work as a team and get on well with people.
STEP 5.
Repeat steps 1 to 4 till you find your needle in the haystack.
CONCLUSION
Following our workshops/events and speaking to over 1,000 finance professionals and accountants, financial modeling is still a significant skills gap.
But fortunately my 5 steps above can be shortened even further using AI embedded hiring technologies, like Vervoe, which Model Citizn has since used to find the single diamond amongst a pile of rocks.
Training is one lever to transform your finance team.
But hiring talent is far quicker, assuming you know where to look for the right skills.
To change and transform finance, we have to change and transform the way we hire people.
Doing the same thing and expecting a different outcome (Einstein insanity) merely based on requiring different skills, without actually testing them, is never going to work.
Very few finance professionals have what it takes to build a good model, but if you use the above steps you can find those diamonds as I did and continue to help the business.
Its like changing someones title to Finance Business Partner and expect them to suddenly add value.
It doesn’t work that way, never will without the right training and hiring.
Being an advanced excel user (not that anyone can succintly explain exactly what that means) helps, but its certainly not the only criteria.
If you want us to review your hiring methods reach out and we can help.
To read more see our past blogs.
If you want to learn more follow us and read more about the content we are planning to release and FOFM and Future of Finance destinations for 2019.
I encourage you to take a peak at my past articles on financial modeling which is the foundation of business decision making, planning and forecasting.
We have also redesigned our website to help you along your journey of levelling up in this space.
We will continue to discuss this topic and you can click to follow me on Twitter or LinkedIn or subscribe to our short but sweet newsletter.
Be sure to check out our pods and video page.
Here are also some past blogs that might be of interest.
Why I disrupted my own role and you should do the same?
Your Financial Model can save lives!
The Demand for Financial Modeling Skills Reaches new Heights
Data Analytics / Big Data is not Financial Modeling
Do You Model Off against the Masters of Financial Modelling?
Virtual CFO the Good, Bad and the Ugly
Lance Rubin is the Founder of Model Citizn, partner of theOutperformer, approved training provider to the Financial Modeling Institute and Group CFO for SequelCFO.
Lance has more than 20 years of combined experience working in model audit, investment banking, corporate finance, finance business partner and Fintech CFO.
Organisations he has worked with include PwC, KPMG, National Australia Bank, Investec Bank and Banjo small business lender.
We have a YouTube channel dedicates to the Future of Financial Modeling and also provide access to Models via Eloquens with thousands of viewers and downloads.
