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Joanna Makomaski

Joanna Makomaski is a specialist in innovative enterprise risk management methods and implementation techniques. She can be reached at riskletters@lrp.com.

Column: Risk Management

Courting Job Candidates

Talent management risks can be exacerbated by a company's recruitment strategies.
By: | November 3, 2014 • 3 min read
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We all know the way to a company’s success is found within the people that it hires. We all understand that it is important to hire the right people for the right job. Good employees are the most precious assets of an organization.

Numerous books are written on effective hunting and attracting techniques, and on how to pull in talented job candidates once you’ve found them. But do we understand what top-shelf candidates are thinking of us as we are recruiting them? Is it possible they may be rejecting us just by virtue of how we have recruited them?

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It is not uncommon to learn that candidates decide not to accept offers simply because they found the whole recruitment process far too maddening. It was just easier to walk away.

A good recruitment process should attract the right kind of employee, the kind that you want in your company, with great knowledge, skills and attitude.

That same recruitment process is also a direct reflection of the operation and professionalism of your organization. Often, when organizations design their talent acquisition strategies, the daunting workload seems to leave them feeling stressed. But remember that feeling is nothing compared to that of job candidates.

Just because organizations believe they have found the perfect candidate, don’t forget there is a real risk that the candidate will not reciprocate those feelings.

Being recruited takes a heavy mental toll on candidates. We should conduct our recruitment process carefully and with empathy.

Starting with the job description — talented candidates know how to analyze job descriptions. If a job description is too vague, littered with corporate jargon or, more importantly, does not give a sense of what the candidate’s success will look like or how it will be measured in that role, you risk a huge strike against you.

Even with a dud job description, it is possible you may get the candidate to an interview. The candidate is likely doing it in hopes of supplementing what they did not learn from the job description or initial discussions with your recruiter.

We know an interview is like a first date. Both parties assess each other. We have to remember that for a good candidate, this is not their first rodeo. It is critical that the recruiting firm not come off as arrogant or not allow the candidate to talk in a meaningful way.

In many ways, a great candidate is in the position of power. So it’s best not to be subjugating. A good candidate usually has other carrots dangling in front of them and they know it.

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Even if the interviews go well, companies should be mindful of not introducing “hoops.” There is nothing worse than for a candidate to discover there are multiple hoops to jump through — drug tests, competency assessments, medical examinations, extended references. These things may be necessary but it’s best to inform candidates of these well in advance.

After the candidate survives the interviews and makes it to the offer stage, it is critical to give the candidate adequate time to produce documents and to consider the offer.

There is nothing is more nerve-wracking for a candidate considering a new job opportunity than to feel like you’re holding a gun to their head. Good candidates take things seriously. They need time to consider. Shortchange them here and you risk your candidate walking the other way.

Just because organizations believe they have found the perfect candidate, don’t forget there is a real risk that the candidate will not reciprocate those feelings. And he or she may leave you at the altar by virtue of how you courted them.

Joanna Makomaski is a specialist in innovative enterprise risk management methods and implementation techniques. She can be reached at riskletters@lrp.com.
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Column: Risk Management

Safe but Stifling

By: | October 15, 2014 • 3 min read
Joanna Makomaski is a specialist in innovative enterprise risk management methods and implementation techniques. She can be reached at riskletters@lrp.com.

Is doing the safe thing the way to have a better result? Or does it lead to your ultimate detriment? That’s a question worthy of an experiment. As for the results, you have them here in my golfer’s (or CEO’s) guide to risk management.

I love golf. It is truly a great sport. It is a perfect balance of risk and reward — a battle of mental and physical abilities.

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It is a game you play against yourself and within yourself. At the end of a day, you add up your score and know that you, and only you, own that score. There is no one to blame or steal the reward. It is all on you. I love that.

As of late, I started to focus on the impact of taking risks when playing. I wondered: If I were to take more risks while playing, would I score better? Would my risk-taking give me more rewards?

So I decided to conduct an experiment. In two rounds this month, I implemented two completely opposite risk strategies.

For the first game, I decided to play very conservatively.

I would lay-up if I thought I might get into trouble. I would use a lesser club off the tee just to keep the ball in play. While swinging, I only focused on striking the ball with an easy, smooth rhythm.

But does playing it safe and risk-free make you a winner in the long run? I played easy golf and scored well but for some reason I didn’t feel very satisfied.

My key objective was to consistently follow a process. I wanted to assure good form for each and every swing, every strike, every ball flight. I didn’t want to hit a stray shot, lose a ball, or exhaust myself beating the club into the ground.

For the next game, I went for the gusto. I took every risk I could. My focus was to make birdie on every hole. No, I wanted to make eagle on every hole. My objective was to sink every putt. Never leave a putt short. I didn’t care what my swing looked or felt like.

Indeed, I hit some majestic shots. Soaring, flying, drifting, fading, hooking, slicing, everywhere you could imagine. I lost nine balls that round and received nine penalty strokes. I was exhausted by the end.

I set my expectations so high that when I failed, I was angry and frustrated. The angrier I got, the harder I swung. The harder I swung, the less accurate I was.

When I compared the two games, I absolutely scored better by playing it safe. I hit the ball easily and it went where I expected it to go. I didn’t lose any balls and therefore didn’t have any penalty strokes. Because I set my goals with the process in mind, I didn’t care that I didn’t make par on every hole.

But does playing it safe and risk-free make you a winner in the long run? I played easy golf and scored well but for some reason I didn’t feel very satisfied. I had this nagging feeling that I could have done better. I didn’t feel as though I pushed myself. I played the easy route. Less risk meant less reward.

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In the full throttle game I played as hard as I could and my voracious risk appetite caused me to score quite poorly. But somehow that form of play left me with more optimism. I imagined harnessing my best holes and repeating them for 18 consecutive holes next time. It was aspirational play.

So when it comes to defining risk appetite, I realized it is a truly tricky concept. In business, we routinely have to balance risk and reward in the pursuit of organizational perfection — the aspiration of all leaders — the perfect round, the perfect deal, the perfect presentation, the perfect opportunity.

If we don’t strive to be the best we can be, if we settle for mediocrity we may never maximize our potential.

And we may never win the green jacket.

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Column: Risk Management

Broken Promises

By: | October 1, 2014 • 3 min read
Joanna Makomaski is a specialist in innovative enterprise risk management methods and implementation techniques. She can be reached at riskletters@lrp.com.

In all of our relationships, either business or personal, we establish trust — at some level — in one another. In some cases, we have trust thrust upon us. In other cases, we have to earn it.

Promises, implied or explicit, are routinely made between us. They can be written, spoken or assumed. We often depend on these promises to make other decisions. If the promise-maker breaks their promise, distrust, catastrophe and chaos can ensue.

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A few months ago, Argentina defaulted on one of its debt payments. Last year, Detroit was forced into bankruptcy and has defaulted on and renegotiated its obligations.

General Motors recalled thousands of cars in the past 12 months. Another company, somewhere, failed to meet a supply agreement and shipped parts below specifications. Someone, somewhere, broke their marriage vows and filed for divorce. In a bar, someone sits waiting for a companion to arrive, having been stood up.

As a promise receiver, how solid is our due diligence and risk management when it comes to accepting promises at face value?

Why do we make promises and then break them? Do we over-promise? As a promise receiver, how solid is our due diligence and risk management when it comes to accepting promises at face value?

How much faith should we place in someone who makes a promise? Are we deserving of the adverse results that may come from these broken promises?
How much responsibility should we take when accepting, or relying on the other party’s promises? Can we influence our outcomes by making better partnership decisions?

In the case of Argentina, I find its actions particularly troubling. Its default almost seemed strategic. Its history corroborates this. Strategic defaults are damaging and have cascading adverse effects. The fallout rolls through the banking sector as the default rolls from one bank to another. The result of not collecting interest payments triggers a series of shortages that, like the credit crisis of 2008, jeopardizes our financial security.

Will time and our willingness to forgive allow Argentina to rebuild its credit rating? The answer is probably yes. We tend to minimize past acts and expect or assume that people, countries and companies will become good corporate citizens and do the right thing and fulfill their obligations.

GM has had a recent rash of recalls. It may have known about the issues or not, but either way, cars with defects were shipped.

I do, however, respect the fact that GM owned its failures and has done what’s right for the customer. I also expect GM consumers will rationalize and forgive GM its transgressions and hope they get it right next time.

In all the above relationships, what I find interesting is that trust and faith are the underpinning elements of a risk decision.

The suitor makes himself or herself look desirable and reliable. The borrower trumps up their financial position and presents a rosy, reliable, responsible outlook. The manufacturer boasts about integrity and quality initiatives.

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If a partner of high integrity and quality fails me, I am sympathetic. Sometimes the circumstance of the breach is beyond our control and we fall victim to a series of events that are like dominos falling.

The decisions we make and the partners we trust have a direct impact on risk and the outcomes we expect and realize.

As we strive to make the best partnership decisions, we should look more into the history, character and integrity of those sitting across the table.

We will make better choices and produce better outcomes by doing so.

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