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Hiring Assessments with Zach Montroy

Published by Summit Marketing Team on 24 Jun 2020

The Virtual CPA Success Show for Creative Agencies: Episode 17


Hiring the wrong person can be expensive. This is especially true when you are a service-based business. Hiring is something that Summit CPA struggled with in the past because we didn’t have the proper tools and methods to determine which potential employees would actually fit into the company. We want to help you learn from our mistakes, and we want to share the lessons we have picked up as we build our team.

In this episode, we are joined by Zach Montroy, our People, Team & Organizational Strategist, and Adam Hale to talk about hiring assessments we use at Summit CPA.

Jamie Nau: Hello, welcome to today's podcast. Today, we are diving in on HR. We have Jamie and Adam here from Summit and then we have our HR guy, Zach, from Navigate the Journey to help talk about this topic. So when we're talking about HR today, we're going to specifically talk about hiring assessments. So I know Summit does several hiring assessments throughout the hiring process, so this is a really important process for us. So, Adam, can you kind of start us off, and talk about how we started going down doing the assessment road?

Adam Hale: Because we sucked at hiring frankly. It’s not to say that we don't have great people, and always had great people, what we struggled with was we fell in love with everybody. You know, we were very excited about what we did and how we did it. So whenever we'd get in an interview, we were really just kind of like bragging about what we do, and how we do it and all this stuff. Then the person on the other side would kind of naturally just fit their skills to meet what we're talking about. We tried things like Excel tests, QuickBooks tests, those kind of things. We never really had any success with the technical side, but we figured we could train the technical side as long as the person on the other side was cool, and kind of fit with the culture, then we would be perfectly fine. We were pretty naive in that thinking because it's not that we didn't have great people that came in, they just weren't always a great fit and we didn't understand what that meant. So we met with Zach, our HR guru here at Summit, and he really helped us kind of navigate a few different assessments that might help us figure out what a good fit means from all those other aspects, you know, it doesn't measure anything on the technical side, so Zach was a big, big part of that one. The first couple of assessments he introduced to us we didn't know of. We were familiar with DISC, those kind of things, so we got that, that was a good baseline for us. He's the one that introduced EQI to us, emotional intelligence, and that is mission critical to everything that we do. And Zach, you can maybe fill people in on a little bit on how that works and how we do it here.

Zach Montroy: Yeah, absolutely. You know, when we talk about hiring, it's such an interesting process because I think you have to make sure that you are coupling the art of knowing how to interview well, and knowing how to hire well, along with sort of a science, and the science part is kind of what we're talking about a little more in depth here. I think when you kind of look at the overall big picture of a hiring process, and what we do during this process, we're trying to learn about a candidate, how they're going to fit in the culture of the company, how they're going to do the job in a really, really truncated timeline. So we want every tool available to us to be able to measure what we need to measure, because we know you spend a lot of time in hiring. Hiring mistakes cost a lot of money to a company, to a culture, and so that's really what we focused on. When we think about an employee we want to know that they get it, they want it, and they have the capacity to do it, that they've got character, they've got chemistry, they’ve for competency. So, you know, Adam talked a little bit about DISC and we'll dive into that. One of the assessments that we introduced into the process at Summit,  in our interviewing process, was this idea of measuring emotional intelligence. This term was kind of coined by a guy named Daniel Goleman back in the 90s, and what he set out to do was, we know what IQ is. we know how to measure that, but there was something in addition to that that accounted for success in relationships, and success in business. So we started measuring this idea of emotional intelligence, you know, underpinning our leadership, our core values, our sort of beliefs and mental models. So we're really looking at how you relate to others, how you relate to self? One of the really interesting things about emotional intelligence is it's proven in the latest research to account for about 60 percent of job success in most industries across the world today. There's actually an article, and this is a little bit of nerd talk here, but the Leadership and Organizational Development Journal published some research showing that, profitable companies, you can actually predict at 80 percent of the time whether a company is profitable or not simply by looking at the emotional intelligence of the leadership. So super interesting that you don't even have to look at anything else. You just look at these numbers of emotional intelligence, of the leadership of the company and you can measure that right away.

Adam Hale: So we were like sign it up. Great a silver bullet time, right?

Zach Montroy: Yeah, I mean, unfortunately, it's not a silver bullet. You know, it's one of the most highly accurate and valid assessments on the market today. I don't think there's any silver bullet in hiring, but it definitely helps us understand how a potential employee is going to relate to the team that they're working with, and how they're going to handle client relationships. You know, when we look at emotional intelligence, we're looking at how do we perceive, and express ourselves? How do we express our thoughts? How do we develop and maintain relationships? How do we cope with challenges? And then, you know, there's emotional information, whether you recognize it or not, flowing in every relationship, every conversation, all the time. You know how do we effectively use that information in a meaningful way. Almost every time that we've had a person with a deficit in emotional intelligence, it's turned out to not be a good situation. So definitely something that we've come a long way on.

Jamie Nau: So would you recommend that test for every company then, or is that specific for a client facing companies or how? Is that the type of test that should be standard for companies across the board?

Zach Montroy: My belief is that if you want a strong team, it's definitely something that I would consider putting into any interview process. You know, we do the same at Navigate the Journey that Summit does, but we're on the HR side. So we work with many different companies and I have never seen it be not useful in an interviewing process. I think you understand how an employee works, how they're going to function, how they're going to manage relationships, even if it's just internal with that information.

Adam Hale: So with that said, though, because I talk about it all the time whenever I'm talking to other CPA firms, if you're having a hiring problem, EQI has been a measure that we've found to be successful. However, there's tons of sites out there that have EQI tests, and you can get them super cheap. I know you're not cheap, you’re pretty expensive. In terms of, you say one, there's a different test that you use, you want to make sure there's some kind of qualification there. But I think the other power is, nobody on our team tries to interpret those. We definitely understand that it's worth spending the money to have somebody also interpret it. So what's your feedback on different websites? I know, maybe not plug one or anything, but I mean are they all created equal or, no?

Zach Montroy: Yeah, that's a great question. Short answer is no. I definitely think you get what you pay for. Interestingly enough, we don't make money off of assessments, you know, our sort of the bread and butter of our company is like, what you just said, interpreting the data and understanding how to operationalize it. So you have to be really, really careful with any assessment that you use in the hiring process. The American Psychological Association gives a validity and reliability rating to every scientifically backed assessment on the market, and the best standard is you need to score above a point nine zero on that validity and reliability in order to use it in a hiring process. You need to be measuring a skill, which is what this assessment does. So we use the emotional intelligence, the EQI 2.0 is the assessment that we use. It's owned by a company called NHS, and the reason we use it is because it's so reliable, so valid.

Adam Hale: So you can do this in California, or other states that have kind of some high bars in terms of their hiring process? EQIs.

Zach Montroy: Yeah, right.

Adam Hale: Which is different than my understanding anyway, and you'd never really want to do this anyway with DISC, because that's more of just how we interact with each other. But, you know, shifting gears a little bit to the DISC that we used, that's not like a hire, or don't kind of a decision maker. You've always kind of told us that's just how we interact with the team, just understanding different people's styles. Then self-assessment too, just understanding, you always talk about like the shadow side of whatever your personality is, just understanding that like what bad might come out of your own personality whenever you get kind of pushed into a corner or something. So how have you been working that in with our team? I know we did it at our team retreat and everybody thought that was super helpful, but just operationalizing that kind of stuff.

Zach Montroy: We use the EQI in a lot in coaching with our CFOs and leadership as well. With DISC, which is great, you cannot use someone's DISC results to make a determination on whether or not you're going to hire them. There's, you know, differing schools of thought on whether you can or should use it in a hiring process. We use it at the very end. Sometimes we use it after we've hired them. We don't use it as a determining factor though, like we do with EQI, because we're not measuring a skill, we're measuring someone's personality and how they're going to react. But you can't say someone's going to be a better accountant if they're a “D” vs if they are an “S”. Again, we're not measuring a skill there. Now, how they interact. How they go about doing that work is probably going to look a lot different. This is just a great tool for helping build self-awareness on your team. It's a great tool for understanding how someone's going to fit in, what kind of clients they're probably going to love working with, what clients are going to drive them batshit crazy, because it helps you understand who you resonate with. Who you have dissonance with, and like you said, it helps you to understand the shadow side of your personality. You know, I am an “I”, leaning towards “D”,  when times are stressful, when stuff is chaotic, the way that I function looks very, very different from the way that a “C” functions, and we can drive each other crazy, but knowing that helps our team understand. That really helps us communicate better, treat other people how they want to be treated and in the end, learn to people-read our clients so that we can best understand and communicate with them.

Jamie Nau: I want to jump back to, I know you kind of moved on from EQI to DISC, but again, you made a statement about using the EQI to decide when it comes to hiring. Now, I've been in conversations with you when it comes to hiring. It's not like we have a number, or we say anybody lower than ninety five we can't hire, there's a lot of discussion around that. Can you expand on that a little bit and kind of how that thought process goes? I think it's similar to what you discussing with DISC, we need to know people's weaknesses, and where they are strong and not coming in, but can you expand on that a little bit?

Zach Montroy: Yeah, and I'll try to not have too much nerd talk here. When you look at the EQI 2.0 assessment, you're not going to just get one number. You do get an overall emotional intelligence number for the person, but you also get scores in five different, what we call composite areas. So we're looking at how do you perceive and express yourself? How do you use emotional information to develop relationships? Then you get numbers on like, how well do you understand emotional self-awareness? What's your leaning towards empathy? A score on how you use information to problem solve, develop relationships, manage stress. So there's actually like 21 different numbers that you're looking at. There's an average score with the standard deviation in the US. We really want people to score within that range of average. But beyond that, I want to see consistent scores. So let's say, for example, we have someone that we're interviewing, and they have a super high assertiveness score, super high score on self-regard, a super low score on empathy and interpersonal relationships. Well, that's going to tell me that this person is probably going to likely railroad over other people, not have a deep understanding of their surroundings. You know, I'm going to look at their emotional self-awareness numbers. That's probably the profile of a bull in a china shop. Is that what we need on our team? That's a question you've got to ask. So you really get an understanding of what the strengths are, and we all have blind spots. So what those blind spots are going to be for that employee. So you kind of get a picture of, you know, when you've worked with someone for six, nine, 12 months, you really kind of know how they function. This really helps, you know how they're going to function. 

Jamie Nau: And I think what you said, that's the best part to me about these assessments, it makes our conversation a lot deeper. When I interview someone, Adam interviews someone, and you interview someone, our conversation are based on those 30 minute conversations and the questions we've asked. That conversation can't last very long, but when you have these scores that go along with it, you're able to provide that assessment like you just did an example of. Maybe sometimes when we're hiring, we need that bull in a china shop. That's what we're looking for and that's what we want to hire. Then sometimes it's like okay, that's not exactly what we need with our team because we already have three of them. So I think it helps us have those discussions and make those decisions better.

Zach Montroy: Going back to something that Adam said earlier, you know, oftentimes, and this is very true, personality. When we meet someone who is like us, we tend to like latch onto them pretty quickly. We tend to not see some of those blind spots that are present. This helps us see that. It helps us gain a fuller picture. When I'm interviewing, I'm looking at a lot of behavioral analysis of the person, and looking at a lot of past performance. The really cool thing about these assessments is that then I can say hey, Adam, you know, here's something that I saw. Jamie, here's something that I saw in the interview. It's coming out in their EQI, can you dig into this a little bit more in your next interview? So I feel like by the time we get done, we have a really full picture of how the person is going to work, how they're going to function and likely how they're going to perform.

Jamie Nau: Yeah, that's exactly the type of conversations that I appreciate having, because of these assessments that we just weren't having before. It’s not like we still don't make bed hires occasionally, but I do think it makes us think through things more. The funny thing is, oftentimes when someone doesn't work out three months later we are like yeah, that’s exactly kind of the stuff we talked about in our assessment.

Zach Montroy: Yeah it’s always a good reminder to trust what you know.

Adam Hale: That’s what we always come back to you every time. We're like, I think I really like this person but I'm seeing this and this. It's like trust the process. Just let it go. Let it go. So that's good. So those are the two that we use most frequently. EQI during the interview process and then DISC afterwards. I've had great conversations with the team to say, hey, I know you need more information and I need to skip steps, like we know that about ourselves let's start over, and it's really helped, the DISC profiling piece of it. But now we're starting to kind of shift gears, because we're trying to build a profile. What is a good CFO profile? What is a good senior accountant profile? Obviously, they have to have some ability to stretch in different directions just based on the roles that we have. But now we're moving a little bit forward to the Kolbe, can you kind of explain how that then interacts with the rest of the stuff?

Zach Montroy: Yeah, so the Kolbe Assessment is a really interesting assessment that we've started using. We've actually talked so far about, you know, there's three different parts of the mind that most psychologists, even ancient philosophers, we can look to. Cognitive, which is where thinking IQ wise, we've got the affective, that feeling part of the brain, you know, where desires, motivations and attitudes set. But there's this part, this striving part of the brain that has been really hard to measure, and we call it the conative. This is the doing part. What's a drive or instinct? What's the mental force? What are our talents? And so this assessment was actually created by a lady named Cathy Kolbe, and it measures four different action modes. We look at what's our relationship to information? How specific of information do we need to have before we're willing to move forward to take action? We're looking at how do we organize information? How do we systematize, what's our acumen towards risk opportunity? Do we tend to be someone who enjoys the status quo? Do we tend to be a person who really needs to be doing something different all the time? And then what's our tendency towards implementation? How do we tend to see? Do we tend to be an innovator, or we can paint a picture with words, or do we need to be working with our hands? So here it's interesting. Again, there's no wrong answer. We are measuring skills. So this is an assessment that we can use in the interviewing process. But we're starting to use this data to really understand, like you said, what's the profile of the accountant that works best at Summit? Because we hired different kinds of accountants, different kinds of CFOs, than would normally be hired by big four, big ten, accounting firms. So we're really using this information to understand. We know that we need a senior accountant that has a high degree of leaning towards detailed factfinding, has various, you know, systematize processes, can sequentially put together information, and they don't have a high leaning towards innovation or risk taking. Now, that looks a little different for our CFOs. But again, we are using this data to build that profile for us, and really help us understand how do our employees act, how do they work, what's their motivation for work? How do they instinctually, you know, approach problem solving, or the work process?

Jamie Nau: I think what is interesting here is obviously, if you're talking about on the accounting level, and I think that's great, building that profile. But if you were thinking from our clients views, and you need to get specific, a lot of our clients are digital agencies, theirs would be a different profile based on what they're looking for, correct?

Jamie Nau: Yeah. They're going to be a very different profile. I think that it's important to figure out what you're looking for with an employee. Are you looking for someone who has a huge drive towards innovation, and a low degree of follow through, in that they're not building their kind of resistance when it comes to building those systems or structures. And so this kind of goes back to building a good hiring profile before you event start the integration process. Oftentimes you find a candidate, they have everything you need, but in reality they don't,  because you didn't do that work up front.

Adam Hale: How does that work with growth? I know you're saying that's just like instinct, that's kind of where that comes from. If you have an accountant that you want to take to a senior accountant, and then a CFO, or some other part of leadership if you're in a different industry, whatever, it doesn't really matter, how does that work? If their instincts based on like they're the perfect, like, lower level person profile? How do you stretch them and grow them?

Zach Montroy: I think this goes back to a book we've talked about in the past that Kim Scott wrote. In the in the book, she talks about rock stars. She talks about superstars. There are some people who are going to be comfortable being in the role that they're in forever. They want to continue growing and developing in that. Then there are other people who have this drive and instinct to move up in the organization. So I do think there's going to be a little bit of difference but to say, you know, a senior accountant can make a great CFO, their profile may lean a little bit more towards that. So, again, we kind of have like a range. We're not looking for an exact, you know, seven, seven, two, four profile, when we are looking at those ranges we're looking for something to be true in there. And in having those conversations, I think even too on the front end so that we know that going into it.

Adam Hale: I think that, you know, the conversations we've had is that your DISC profile might change a little bit over time, situational, but that's more of like where you're at in your life right now but you eventually kind of work your way back. Then EQI is one of those things where, unlike IQ, where you can kind of grow that and learn to grow that, and then what about Kolbe? Is that one of those things where it’s more like DISC? Or is it, because sounds like it's instinct, so it's something like really native to somebody. So is it more like DISC, or is it more like EQI in that regard?

Zach Montroy: It is not. Instinct is actually something that does not change over your life all things being normal there, that’s a big statement. But all things being the same. You can take Kolbe when you're fifteen and you can take Kolbe when you're eighty five, and you are likely going to score very, very similarly to how you scored. You know, we're going to say that like no big traumas have happened over lifetimes, you know something in that regard. But interestingly too, Kolbe has a right fit profile. So one that if Jamie, and Adam, are in the hiring team we'd all take this hiring profile together, and when we're looking at candidates, it's actually going to have the candidate match up against that profile, and give us like A, they're going to be a high likelihood of performing well in this role for what you have, which you need, which you want from this person now and looking at growth. Or here's some big areas of concern when it comes to this candidate and how they're going to perform in this role.

 Adam Hale: So blending in all three of them together is kind of important, like know what their instinct is, what their range is on the emotional intelligence, and then, you know, kind of understanding how they're going to interact with the team. Obviously, we're still trying to kind of, you know, manage how to build that profile right now. But we feel like we're coming close. And as you said early on in the conversation, I think that you can't overstate the fact that hiring the wrong person is very expensive. So, you know, I joked earlier that you're expensive, but you're not compared to hiring the wrong person. You pay for yourself extremely quick. So it's been a huge difference for us I think at Summit, because we do have so many applicants coming in, and we did kind of fall in love with everybody right out of the gate. So to have this objective piece, and somebody like you to be able to interpret it for us has really made all the difference in the world.

Jamie Nau: Yeah, and I think to the point of hiring the wrong person being expensive, I think that's especially true when you're in client services. When you're in client services after you hire someone you introduce them to the client right away. You’re like, this is your new senior accountant, this is your new CFO, if that person ends up being a wrong fit either for us or for them, then you're having to introduce someone else in three months, six months or nine months, whenever that is, that's really where the costs add up. So I think that's a great point, that's why we've put so much time into this. Zach, Adam, Jody and I meet every week talking through this and trying to assess what the right model is. What the right person is, and especially during growth when you're hiring all the time you've got to get this right. So I think it has been a great podcast. Any final thoughts from you, Zach? Stuff that people need to consider when they're looking at these assessments, or how to build the assessment process?

Zach Montroy: I just think be very intentional on the front end. You know, know what you're looking for. Have these conversations before you ever start talking to candidates. Know what's going to work from previous employees that you've hired. Look for that when you're hiring, build up the questions you're going to ask. There's a lot of great resources. There's a book I just read recently called, Knowing The Who, I think that’s what is was called. It talks all about best process and practices for hiring. So make sure you some of that stuff on your side.

Jamie Nau: What about you, Adam. Any final thoughts from you?

Adam Hale: Secret sauce is out. It’s Zach and all these assessments. Now everybody is going to be knocking on his door, trying to figure out these assessments. I mean, that's really how we've assembled such a great team.

Jamie Nau: Good thing you've told everybody he is super expensive.

All: Laughing [in audible]

Jamie Nau: Alright, great show. Thanks for joining us guys.

 

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