The Unfortunately All-Too- Frequent Resume Bluff

lieLast week I was a guest on a business radio program. The focus of this hour long broadcast was “Resume Fraud.” Resume fraud may sound a bit harsh so feel free to replace fraud with any of the following: embellishment, exaggeration, deception, distortion, fabrication, misrepresentation etc. You get the picture!

Any way you refer to it, this behavior is far more common than anyone would like to believe. In fact, some of the research indicates that 30-50% of people lie on their resumes. These numbers tend to increase during tough economic times when a combination of job scarcity and angst may make people more willing to engage in behaviors they might not otherwise.

Resume “fiction” can also take a variety of forms not all of which will engender the same response. Stretching the dates of employment or even changing them to cover gaps or the appearance of job-hopping is prevalent. As can be enhancing one’s responsibilities. For example, did “candidate A” have 100 people reporting into him/her or 500? Were the savings he/she created valued at $30 million or $100 million? These details may be challenging to confirm.

Altering a job title may be a bit more difficult to carry out but certainly occurs as does the modification of degrees and other professional designations. The recent big story in this arena surrounded Scott Thompson who was very briefly the CEO of Yahoo. Thompson came to Yahoo from PayPal and claimed that he had a degree in Computer Science AND Accounting from Stonehill College. While Thompson did in fact graduate from Stonehill, the college did not offer a computer science major until well after he claimed to have received his. Aside from the trouble this caused it serves to illustrate that distortion can take place at even the most senior levels.

When it comes to education, some indentify mere attendance at college as a degree. There are also the many professional designations and actual degrees that can be obtained from uncredentialed institutions. These so-called “diploma mills” are a thriving business facilitated by the Internet as well as the pressure to compete for jobs that are oftentimes scarce.

And the possibilities go on and on…unfortunately. So what can a potential employer do about all of this?

As Ronald Reagan once said: “Trust, but verify.”

Degree verifications are the baseline and so easy to conduct that their omission in the hiring process is simply negligence. In addition to this, comparing a potential candidate’s resume to their LinkedIn profile while not foolproof, is another step in mitigating risk. Hopefully because a LinkedIn profile is exposed and accessible to almost anyone, the temptation to misrepresent is reined in.

Whenever possible, it is helpful to measure a candidate’s skills objectively. This is not always possible but creativity can go along way here. Ask a marketing or sales candidate to prepare a presentation as to how they would promote your product or service. Have a programmer write some code or an Executive Assistant prepare a document or answer the phone. I always switch to speaking French when a candidate claims this language facility!

References while helpful, are not enough. Speak to those provided by the candidate and if possible a few that have not been proffered. LinkedIn can be very helpful in this regard as well. This step in the hiring process can be laborious but definitely worth the effort.

While no amount of skepticism and verification will completely eliminate these problems, as a potential employer it is wise to proceed with caution and avail yourself of the tools and techniques that work. Cutting corners leads to less than optimal hires and ultimately less than optimal results, or worse!

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June 7, 2013 at 1:08 pm

Succession Planning: Not Just for Older Leaders

Dell Computer and the story of its potentially going private have occupied  many a news column of late. In the most recent turn of events, Blackstone Group  withdrew its bid for the company after making the determination that Dell’s future and the PC industry looks bleak. Throughout all this I cannot help but  ask what seems to be a fundamental underlying question about this company, and that is, who should lead Dell going forward?

Yes, Michael Dell is an icon of the stature of Steve Jobs and Bill Gates.  He is highly intelligent and incredibly successful with a net worth of $15.3  billion as of March 2013 (per Forbes Magazine.) But he has been leading Dell  Computer (save for three years when Kevin Rollins was at the helm) for the past 29 years, since he started the company while at College at the age of 19. No matter whom the talent, anyone in the same position for several decades is bound to become temperate, or perhaps even myopic. It is essentially impossible not to and this is particularly true in the ever-changing and evolving technology industry.

According to The Conference Board, CEO tenure has decreased to an average of 8.4 years as of 2011 from 10 years in 2000. This should come as no surprise given the increasing independence of corporate boards and the pressure to take decisive action when the company is stagnating. There is also ample evidence that there is a lifecycle of effectiveness for any business leader (perhaps this holds true for leader in any field, even politicians!) In fact, in research reported in the Strategic Management Journal (February 2006), Henderson, Miller and Hambrick found “in the dynamic computer industry, CEOs were at their best when they started their jobs, and firm performance declined steadily across their tenures, presumably as their paradigms grew obsolete more quickly than they could learn.”

This presents an interesting dilemma. It is clear once again that planned CEO succession is necessary. Appropriate and carefully selected and strategic change at the top can do much to resuscitate an organization. It is also evident that even the best leaders have a “shelf-life.” However Michael Dell is in fact only 48 and he is also Dell’s largest shareholder. The usual best practices may be hard to apply.

But apply they must! In all of the news and speculation surrounding this story there is rarely a mention of who should lead Dell going forward and whether Michael Dell remains the best candidate for the job. We know the PC market is in a free fall and we know the financials of the company ad nauseum, but what about the brainpower, ingenuity and creativity that is needed to steer this behemoth in the right direction? Some guidance and information along these lines is becoming unavoidable.

April 30, 2013 at 10:36 pm

Results V. Face-time

telecommuteNo, the title of this article does not refer to some new video game or online competition. Rather I am alluding to the current debate that has resulted in the aftermath of Yahoo’s announcement earlier this week that it is ending its work-at-home policy.

This announcement has resulted in large-scale reactions in the press and online. There are a plethora of opinions on this matter, including the thought that this is simply a way for Marissa Mayer to “clean-house” by lowering headcount without the cost of severance packages.

There are, of course, many ways to think about working at home versus in an office but I believe it is wise to always remember that one size does not fit all. That being said, perhaps the underlying dilemma here is to determine how to best evaluate progress and results in an organization.

Yes, Yahoo has had more than its fair share of struggles, yet can anyone say with certainty what effect, if any, the fact that they allowed workers to telecommute has had on their results, or lack thereof? Furthermore, who knows, perhaps if they had not allowed workers to telecommute the company would be in far worse shape.

In the best-selling book “The 2020 Workplace” Jeanne C. Meister and Karie Willyerd state:

“In the year 2020, our office will be everywhere; our team members will live halfway around the world. How, where, when, and for whom we work will be up to us – as long as we produce results. By the year 2020, the rules of the employee-employer contract will have to be rewritten by the best employers if they are to compete for top talent”

Yes, face-time is necessary within an organization and relationships do need to be fostered but this can in fact be accomplished through periodic time spent in the office rather than all the time. Additionally, the very fundamentals of how relationships are cultivated is undergoing massive change in our new hyper-connected world. This “need-to-be around the water cooler to innovate” is an out-dated idea reminiscent of the work environment of Mad Men.

Given the turnaround that is required at Yahoo, Mayer may be correct in assuming that more team building and camaraderie is necessary but this broad-sweeping change may have the opposite effect. Rigidity and regimentation may stifle the creativity that is certainly imperative at the company.

Finally, and just to add another dimension to the issue, I will refer to the idea of working in “third-places.” First places are corporate offices, second places are home offices and third places are other locations where work gets done. The most familiar of these is your local Starbucks! “The 2020 Workplace” refers to research by Gartner Dataquest that estimates that “one-fifth of the nation’s workforce is part of the so-called Kinko’s Generation, spending a significant number of hours each month working outside a traditional office.”

Full disclosure, I spend most of my time working in second or third places!

February 28, 2013 at 11:56 pm

Women and Boards: Musings and Reflections!

imagesCAXTK431On 12/12/12, 1400 people in the US and Europe got together at 27 luncheons to discuss the topic of women and corporate boards. These events were organized by various chapters of 2020 Women on Boards, a Boston based non-profit with the simple goal of insuring that by 2020, at least 20% of board seats are filled by women. Simple goal, yet challenging to actually achieve.

The 2012 Catalyst Census that was just published states that in 2011 women held 16.1% of board seats. They hold a mere 3.3% of board chair positions and 8.4% of lead director roles. Some good news in these statistics is the fact that women hold 19% of nominating/governance chair roles (we won’t belabor the point that this number dropped slightly from the year before when it was 19.2%). This puts us in an ideal role to decide on who joins the board when there is an opening.

In preparing to participate on one of these panels I researched and explored this topic ad nauseum! The one thing that no one will disagree with is that the issue is complex and there is no one or easy solution. However there are certain realities and facts that are worth summarizing:

1-Gender diversity is a value driver for the organization – it is not a hand-out (about a year ago I wrote on the subject of why we need more women on boards. At this point, the advantages have been shown over and over again)!

2-It is also not an entitlement or right. The best boards elect qualified directors with an emphasis on qualifications!

3-The United States is 11th amongst industrialized nations regarding women’s representation on boards. The US trails Norway with 36%, Sweden with 26% and France with 17%.

4-Legislation to boost women’s representation on boards has spread like wildfire. There is also a global conversation on the subject going on right now but the changes are still slow to come.

5-Part of the challenge with this issue is turnover on boards. The average director’s age has risen from 60.1 to 62.6. Only 4% of S&P companies now have term limits.

6-As of a couple of weeks ago, even the United Arab Emirates has a requirement for compulsory appointment of women to boards.

7-Another aspect of the challenge has to do with simple business priorities. A company may want to boost the number of women on their board but given the many business challenges it faces this may simply be lower down on the priority list.

8-Sponsorship can help. This involves advocating for high-profile women in one’s organization or elsewhere and helping them access board opportunities.

9-For those wanting to sit on a board, manage your career, raise your profile and seek opportunities to run something if at all possible. Operating experience is still the number one desired skill set in the boardroom.

10-If you are a board member keep diversity on the agenda. Make is a strategic priority.

There is so much more than can be said but these few thoughts and facts should make it crystal clear that change is underway. It will, however, take the efforts of many in assorted and enduring ways to see it through.

December 20, 2012 at 12:44 am

CEOs and Board Relationships: Does the Rolodex Matter (Still)?

How do informal social ties and connections between members of a board of directors and a CEO impact the effectiveness of the board and hence corporate governance overall? This can be a complex and immeasurable phenomenon but Dr. Bang Dang Nguyen of the University of Cambridge, Judge Business School attempts to answer this question in his paper “Does the Rolodex Still Matter Corporate Elite’s Small World and the Effectiveness of Boards of Directors”

To begin with, it should be mentioned that the central findings of Dr. Nguyen’s paper, namely that when a CEO and a number of board members belong to the same social networks, the former is less likely to be dismissed for poor performance, should not come as a big surprise to anyone. However, that was not the only interesting finding.

What Were Dr. Nguyen’s Findings?

Dr. Nguyen’s paper is based on empirical analysis of a sample of the largest publicly-traded firms in France between 1994 and 2001. Yes, times have changed since then and yes, the United States is indeed not France but this type of analysis, of normally non-measurable and non-visible elements of governance are rare and thus at least worth considering.

In the study, Dr. Nguyen found that close ties can adversely affect company performance as a connected CEO was almost three-times less likely to be fired for poor performance than a non-connected CEO. It makes intuitive sense that we tend to be more lenient with those we have something in common with than those where there is no emotional or personal connection. On the other hand, Dr. Nguyen believes that opposing forces are at play in that there is the positive impact from information sharing gained from having close ties between the CEO and the board.

Moreover, Dr. Nguyen’s paper also found that a “socially connected” CEO was more likely to find new and often better positions even after a forced departure for poor performance than a “socially un-connected” CEO. Hence, social networks (in the pre-Facebook sense of the word) appear to impact board effectiveness in its key role of hiring CEOs – a problem when it’s the job of the board to protect shareholder value by hiring the best person for the role.

Where do these ties come from? In France the corporate elite begin long-term friendships when attending a handful of exclusive colleges or so-called “Grandes Ecoles” and through elite civil service (Grands Corps de l’Etat). In the United States some of this occurs with networks formed at Ivy League colleges being fairly permanent and indelible.

A Few Recommendations

Dr. Nguyen did make the comment in his paper that the USA economy is much larger, more deregulated and has more elite schools than France’s – meaning social ties between top executives might be different or work differently than in the smaller and more close knit world of corporate France. He also admitted that there is little regulators can do about social networks as they tend to be resilient while the ties themselves are not readily observable nor quantifiable but he does suggest that regulators might want to broaden their analysis to include factors like common education backgrounds and social connections.

Hence, it’s worth adding that shareholders and executive search practitioners have a role to play in ensuring that the CEO position and slots on the board of directors are open to a greater pool of talent and not just to insiders who are all members of the same small and closed social networks. After all and in today’s competitive marketplace where regulators are increasing breathing down everyone’s necks, drawing names from the same Rolodex or old boys’ or girls’ network simply will not cut it anymore.

November 26, 2012 at 5:13 pm 7 comments

Staying Complaint as Compliance Moves Out of the Office (and Into the Bar)

Thanks at least in part to the banking scandals over the past few years, Reuters has recently reported that bank compliance teams are increasingly scrutinizing outside the office activities like social outings to bars and the like. In fact, Reuters reported that some banks in Europe are even requiring their employees to take part in behavior coaching sessions that include simulations of pub outings where the talk turns to subjects like office gossip or clients and the “right answer” is to change the subject and change it quickly. So how do employees now, whether they work in banking, on Wall Street or in other industries also under scrutiny,
stay compliant when compliance is increasingly moving out of the workplace and into social gatherings or public places? Here are a couple of tips to consider:

Stay Informed Outside the Office.

While it’s all too easy to make clients, work or business the topic of conversation when you are socializing with your colleagues, you will have much more to talk about if you stay well informed about events or activities such as sports, current events, places to vacation or
even the latest movie or television show. Just one big caveat: Avoid politics. While that may be hard to do with elections around the corner, you could easily step on a colleague or manager’s toes with the mere mention of anything political if they hold an opposing viewpoint.

Avoid Alcohol or Drink in Moderation.

An alcoholic drink or two may be a great way to unwind at the end of the day or week but an excess of alcohol can easily have you let down your guard a little too much and you may find yourself discussing business at the bar. Perhaps even worse, a few drinks might noticeably increase the decibel of your voice (just like some people talk noticeably louder on their mobile phones) and put you and your conversation within earshot of those who are not part of your group – even competitors who may frequent the same watering holes after hours.

Assume Everyone is Listening!

It’s amazing how much private business gets discussed in taxi cabs on the way to a meeting or at restaurants while a meal is being served or just within earshot of plenty of other people who aren’t intended to be part of the conversation. My personal pet peeve is loud personal or confidential business conversations in elevators!

Remember, chances are the taxi cab driver driving you to that meeting, the golf caddy carrying your golf clubs and the waiter or waitress serving you that business lunch or dinner are not deaf and neither are the people sitting at the tables around you. Hence, be aware of your surroundings, how private they are and who is in them before discussing really personal business that might be better discussed in a meeting room with the doors closed. Remember the scene from the movie Barbarians at the Gate (based on true story about the attempted buyout of R.J.R. Nabisco) where the barber (among others) promptly acted on stock tips they heard while serving some of the characters in the story?

Whether you work in banking or on Wall Street or in another profession, just remember that what you do or say at social gatherings or in public places is under increased and ever-escalating scrutiny.

October 15, 2012 at 1:09 pm 1 comment

Why Did Tuesday Morning Corporation Oust Their CEO?

This past summer, home furnishings retailer Tuesday Morning Corporation
abruptly fired their CEO Kathleen Mason after a new but activist shareholder
filed a letter with the SEC that was highly critical of the company’s
performance under her 12 years at the helm. And while a CEO being fired for
performance thanks to an activist shareholder might still be an unusual
incident, what makes this case even more unique is that Mason has since filed a
discrimination suit against her former employer alleging that she was fired not
for poor performance but because she was being treated for breast cancer.

Tuesday Morning Corporation Fires Their CEO

Trouble for Mason apparently began when Tuesday Morning Corporation reported a wider than expected third-quarter loss along with a fourth consecutive sales decline in April. Then on June 6, Becker Drapkin Management L.P., a Dallas based hedge fund that owns a 5.7% stake in Tuesday Morning Corporation, filed a letter with the SEC to disclose their stake in the company. They took the filing as an opportunity to give a scathing review of Mason’s performance as CEO. She was fired the same day. Becker Drapkin then gained control of four board seats and signaled that more changes would be coming in how the company is run.

Was Mason Fired for Performance or For Having Breast Cancer?

However, the story does not end there. According to BusinessWeek, Kathleen Mason (aged 63) says she was diagnosed with breast cancer in the summer of 2011 and then quietly underwent three surgeries during the months of October and November using her vacation time for post-operative visits. She would also schedule doctor appointments for early in the morning and then work in her office until 7 or 8 pm in the evening.

In January and February, Mason decided to inform two Board members of her medical condition in order to stem office gossip over weight loss and the loss of her hair. In March about 60 days before the firing, Mason said that she had received a $500,000 bonus and an amended employment contract.

However three weeks before being fired, Mason claims she was given an ultimatum to either resign or retire and that three of the five board members wanted to fire her because they feared she would be too distracted by medical treatments to turn around the company’s flagging sales. Mason did say that Tuesday Morning Corporation’s severance package included 10% of her $1.3 million compensation package if she would agree to stay on as a company consultant for 10 years and this period would then be followed by an 18- month non-compete period. She would also keep her medical benefits.

Questions or Lessons for CEOs and Corporate Boards

Obviously this could turn into a lengthy and ugly case that won’t benefit any of the parties involved (including shareholders) yet it raises a few important questions for other CEOs or executives and corporate boards faced with similar situations.

For starters, when are CEOs (or senior executives) obligated to inform their Board of a medical condition that could impact their performance in the job and hence, the company’s performance? Moreover, when and after what steps or protocols can the Board fire an executive over performance when they know the person also has a potentially serious illness that could be impacting his or her performance?

In this particular case, Mason has defended her performance by pointing out that at least half-dozen competing retail chains (e.g. Linen ‘N Things, Bombay & Co. Inc. and Filene’s Basement) had filed for bankruptcy during her 12 year tenure as CEO.

Mason’s attorney has also stated that Tuesday Morning Corporation did not follow proper procedures or protocols to warn her about any perceived problems regarding her performance. If that’s the case, one also has to wonder whether the Board consulted with an attorney or expert in such matters before making a decision to fire her as no doubt they would have been advised to proceed more carefully given her known illness.

At this point in time, there is not enough information publicly available to determine how this case would be decided if it came to trial. However there are lessons to be learned from this story on all sides of the equation. And one final thought, the last thing Tuesday Morning Corporation needs is to have its customers, most of whom are probably female, thinking that they fired their CEO because she had breast cancer.

September 25, 2012 at 2:01 pm 2 comments

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