Kim Shepherd

"It’s very common in my organization on a daily basis to see an email that says, “Just landed a green flag chunky monkey but heads up cockroach committee because this could be a dog with fleas." Kim Shepherd

Kim Shepherd is CEO of Decision Toolbox which she joined in 2000 and brought her unconventional approach to the company she had admired as a client. Today Decision Toolbox is 100% virtual with more than 70 team members working remotely across the United States. Founded in 1992, Decision Toolbox provides scalable and easily integrated recruitment solutions for a 7% cost-per-hire on average while incorporating rigorous quality controls and a 12-month candidate guarantee.

Welcome to a Talent Acquisition Channel podcast on TotalPicture Radio. This is Peter Clayton reporting, and I’m delighted to have on the show today, Kim Shepherd, CEO of Decision Toolbox.

During the opening night reception at ERE Spring, Jeff Bloch, the CMO of Decision Toolbox handed me a book titled The Bite Me School of Management: Taking A Bite Out of Conventional Business Thinking (Amazon link), written by Kim. That title led Jeff and I to chase around the Hyatt Hotel looking for Kim, because anybody who wrote a book with that title, I wanted to meet! 

Kim Shepherd Transcript TotalPicture Radio

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Kim Shepherd is CEO of Decision Toolbox which she joined in 2000 and brought her unconventional approach to the company she had admired as a client. Today Decision Toolbox is 100% virtual with more than 60 team members working remotely across the United States. Founded in 1992, Decision Toolbox provides scalable and easily integrated recruitment solutions for a 7% cost-per-hire on average while incorporating rigorous quality controls and a 12-month candidate guarantee.

Welcome to an Inside Recruiting and Talent Acquisition Channel podcast on TotalPicture Radio. This is Peter Clayton reporting, and I’m delighted to have on the show today, Kim Shepherd, CEO of Decision Toolbox.

Kim?

Kim: Thank you so much Peter, it’s a pleasure to be here.

Peter: During the opening night reception at ERE, Jeff Bloch who is the CMO of Decision Toolbox handed me a book titled The Bite Me School of Management: Taking A Bite Out of Conventional Business Thinking written by Kim and that title led Jeff and I chased around the Hyatt Hotel looking for Kim because anybody who wrote a book with that title, I wanted to meet but we’re doing it virtually. Tell us about the inspiration for your book, Kim. Why did you write this?

Kim: I’ve been thinking about it for 20 years and I used to in a past life, I was a television reporter for 10 years and then became the Director of Entertainment for Club Med worldwide. Then when I entered the corporate world as a recruiter, I started noticing – I think I had my old journalism hat on – and I started noticing that I thought people were doing things wrong. They follow business models to a T and I just thought that there was a real lack of common sense. And since I really didn’t know what I was doing corporately as a leader and was just following my gut instinct, whenever I would face a challenge with big heady subjects like time management, corporate culture, politics within their workplace, big topics, I tended to find myself solving them in really goofy ways. And so whenever I would do that, I would write down the maybe five or six words on a 3x5 card and throw it in a drawer.

A couple of years ago, I pulled out the cards and took it to a publisher friend of mine and they were like, “You’ve got a book here.” Basically the book which is a very quick read, it’s like an hour read, I just wanted to say bite me to the business way of looking at things instead of the human way of looking at things and solving problems in a fun way that kind of – you know those balls on an executive desk where you hit one and it goes, “Bing, bang, bing, bing, bing, bing,” that’s what I wanted to do with everything that I touch and so that was kind of the inspiration for the book but then I was like, “I don’t have time to write a book, what am I going to do?” I was lying on the couch. I was watching on Lord of the Rings. I went, “Oh! I’ll go to middle earth.” I went to New Zealand and holed up in a cabin overlooking where they shot Lord of the Rings and pounded up a book in 10 days.

Peter: That’s really cool, so your book includes a glossary with terms such as cockroach hunting, dogs with fleas and tiger team – can you explain some of these to us?

Kim: Sure.

Peter: What is cockroach hunting?

Kim: I think that tribal speak is really important for culture and particularly when you’re a virtual company and we have 74 virtual workers now, so we grew quite a bit in 2010. Tribal speak to me is really important and speaking – I had a friend who said that I speak in headlines, which I do, and so cockroach hunting is when I have all of our recruiters are formed in the pods of three or four people and they get together on Skype or iChat for an hour one day a week.

In recruitment, there is always a problem and so rather them on kind of getting distracted and talking about their son’s soccer game or whatever, they have start the meeting with we are here to kill each other’s cockroaches, and what they do is they figure out who’s got the biggest cockroach and then they spend that hour figuring out the solution on how to kill the cockroach. Of course, the cockroach maybe it’s a problematic hiring manager which is what I refer to as a dog with fleas – or a position that’s paying under market or whatever.

It’s very common in my organization on a daily basis to see an email that says, “Just landed a green flag chunky monkey but heads up cockroach committee because this could be a dog with fleas,” and everybody in the organization knows exactly what that means, so green flag – anything good that happens is called a green flag and there’s a long story behind that – a chunky monkey means a large project, but be careful because it could be a dog with fleas – we’ve got a possible problematic hiring manager and there’s something about the position that may need it to go to the cockroach committee.

Peter: Decision Toolbox is not a traditional recruiting agency in the sense that you don’t do contingency or retained searches. Tell us about how your company operates.

Kim: We’re on a contained C-model, so that’s a little bit of money on the front end and then a little bit of money on candidate’s 30th day of employment, so it’s broken into two chunks. Our average fee ends up being usually about $5400 to $6400 total. The biggest fee you could pay is $9400. We just filled a C-level position. Usually we kind of play in the mid level management space; we just filled a C-level position where the base comp was 320 and the total fee was $9400.

Peter: Which obviously is way below what a contingency recruiting company would charge.

Kim: Yeah, most contingency firms would probably charge about $95,000 for that and our is $9400. It’s kind of nice because at that low price point, we can manhandle our hiring managers a little bit where it’s like – we’re teamed up here. You’re getting a huge discount. We got to move really fast. You can’t fool around. Bells and whistles go off if any of the metrics are getting askew at all. Usually it takes us an average of about 12 days to present the candidate that ultimately ends up filling the position.

Peter: Where do you source your candidates?

Kim: Everybody is findable, so we have a team of 14 sourcers and all they do is scour backdoors through Monster, social media sites, LinkedIn, FlipDog, Jigsaw, all of those tools that I have no idea what they do and then they do the name gen and they push the candidates to the recruitment coordinator who’s in charge of the project. We do what we call a push and pull, so we’re going to pull in from all different job boards and then we’re going to push the opportunity to people that probably aren’t looking and we fill about 500 positions a month and it’s right down the middle, 50% are coming from the pull and 50% are coming from the push.

Peter: Will you present a client who’s unemployed?

Kim: Yes. I’m glad you bring that topic up because this just bugs the heck out of me. We get so many hiring managers who say I don’t want to look at anyone who’s unemployed and I say to them, “Oh really?” I said, “Let’s take us back to Q4 of ’09 where everybody dumped 10-20% of the workforce because they didn’t know what was going to happen in 2010 and they wanted to keep their powder dry, so they just cut.” I belong to a CEO roundtable with 18 very sharp CEO and I posed this question to them. “How many of you cut 10-20% of your workforce in Q4 of ’09,” everybody raised their hands. I said, “How many of you cut on salary, not necessarily talent?” All of them reluctantly raised their hands.

You’ve got this really deep –we’re in this perfect storm right now where it’s a job-rich environment, it’s a candidate rich environment and there’s a talent drought. They say “I don’t want to look at anybody who’s not employed,” and yet when I push back and say, “Did you put talented people in that big garbage pit called the candidate pool?” They said yes and I said, “There’s talent residing in there that are unemployed and you put them there, so why wouldn’t you look at them if they’ve got the right background?” Once that conversation takes place, they kind of go, “Oh yeah. I’m guilty.” Increasingly you have to push back on them but their problem is, is sifting through the chaff – you’ve got so many – for example, and this is an exaggerated example and it’s not a real example, but it is possible that you could have a position for an accounts receivable manager and have a controller and possibly even an unemployed CFO applied for the position and then some recruiters would be quite tempted to present that candidate but we both know that that candidate, if they took the job, they’re going to leave at the first opportunity to jump ship.

Peter: Which recently puts them into Catch-22 because – you wrote a really interesting blog post several months ago called The Hidden Unemployed and a lot of these folks, they just want to go back to work you know.

Kim: Exactly right. You hear about the – and not to be a cynic, but you hear that, “Oh boy, the unemployment rate went from 9.3 to 8.8, and everybody jumps for joy and the stock market responds and everybody is happy,” well if you look at the real numbers, go to a cocktail party and talk to 10 people and find out their job situation and 4 our of those 10 either are unemployed, unemployed and no longer on receiving unemployment benefits or they formed a consultancy with which they’re not making any money but at least they’ve got a business card, or they were making $80k and they took a job where they’re making $50k, this is the true underemployed, and I believe that about a fourth of the people out there are underemployed.

Peter: And I would bet that about half of the people who lost their jobs in 2009 who were over 50 years old are underemployed or not employed.

Kim: Exactly, and those are primarily the people that are creating consultancies.

Peter: Right.

Kim: So they can keep their ego about them. They may not have any assignments because that market has flooded and there’s less dollars or there’s a reluctance to use consultants right now because we’re still in that – even though we’re saying, “Oh boy,” you know the job market is coming back, it’s not really. It’s like if you’re in a thunderstorm and the thunder stops but it’s still pouring rain, we say, “Whoo, the storm is over.” Well, that’s not necessarily true. You put down your umbrella, you’re still going to get drenched.

Peter: I think, Kim, a lot of the hires that I’ve heard about recently are people who are coming in really and replacing deadwood.

Kim: Exactly, yeah.

Peter: In your position and I guess – would you refer to your firm as an RPO (recruitment process outsourcer), is that basically what you guys do?

Kim: Yes it is. We call it, we’re the number one player in a brand new space that we created which is called recruitment partner in-sourcing because we found that with RPO a lot of companies get anxiety on feeling like they’re throwing their job orders over the roof and then they’re standing back waiting for something to happen. So what we do is it’s still virtual but we bring in a dashboard so that they can see everything that’s going on behind the scenes – the writers, the quality assurance team, the candidate flow – so that they’ve got a sense of security so that they still like – I believe that outsourcing feels out of control, in-sourcing feels in control.

Peter: That’s very interesting and it brings up something that that you’re hearing a lot about at these conferences, like ERE, which is transparency and authenticity. So if you’re building a dashboard and you’re allowing your clients to basically see exactly the whole process that you’re going through and the candidates that you’re vetting for a specific position, it really takes the smoke and mirrors out of it.

Kim: Exactly, plus if they want us to for free, we provide them with their own applicant tracking system that they use or reuse and we can use in conjunction everything that we touch and capture on their behalf they own. If we’re working with a particular client, we look like that particular client, Decision Toolbox disappears, so we’re just there. And what’s nice right now is… the biggest hot button right now is scalability. There’s a reluctance to rebuild the internal recruiting department because there are so much uncertainty on whether or not what the hiring is going to look like plus, we’ve got what I call “req creep.”

Peter: Right.

Kim: You know, requesitions creeping through and so those kind of like hidden openings. And so with us we come in with them and they can turn us on, they can turn us off, the scalability is on our shoulders, not on theirs. So they get a big project, we bring in more people. Project is over, our people disappear but the dashboard remains, applicant tracking system remains and so they can really – and it’s kind of like paying by the drink instead of by the bottle, but price-wise, it’s like you’re paying by the bottle.

Peter: Back to what you were talking earlier about on the number of people getting laid off back in 2009, an awful lot of those were in-house recruiters who lost their jobs.

Kim: First thing to go because if there’s a perception that we’re on a firing mode instead of hiring mode, the first thing that goes is the recruiters and then they scale back human resources and we (knocking on wood right now) grew 78% in 2010 and I believe that the reason of that was that Q4 of ’09 when all of a sudden, okay maybe they’re not hiring 30 people a month, that they’re hiring three and they had nowhere to go so they came to us and now they’re discovering wait a minute, you’re cheaper than when we had it internal, scalability issue is on your back. We turn you on and off as needed and you’re faster because with 74 we’ve got a broader bench, so now what we’re hopeful for is in 2011, we’re looking to double because let’s say those companies that are hiring three people a month, now hire six people a month, that basically doubles my business.

Peter: Back to something you said earlier about this CEO roundtable and everyone reluctantly raising their hands when it was based on compensation who got laid off, right?

Kim: Right.

Peter: Remember Circuit City, remember that company?

Kim: Sure. Long, long ago in a galaxy far away.

Peter: When I started TotalPicture Radio, back around 2004, and one of the inspirations for this show believe it or not, it was a front-page article in the Wall Street Journal about Circuit City and they had made this decision to lay off all of their top salespeople. They were a commission-based organization, so they laid off all the people who were making the most money, which I thought was about the dumbest thing I’ve ever heard.

Kim: Well, they did something that was even worse before they did that. About a year before that, they decided to cap sales commission. That is like bad math. You do not want to cap your top sales professionals, so they capped them and then you’re right, they decided to cut the top people and what was the end result? They went out of business.

Peter: Yeah. Fast forward to 2009 and these people sheepishly raising their hand in your CEO roundtable, it seems to me this is going to come around and bite them in the ass. When you’re saying we’re getting rid of our high performers, you’re getting rid of your A players now that the economy is turning around, they don’t have those people.

Kim: Exactly. It’s already biting them because the companies kind of unilaterally have not come back to their original staffing levels of 2009, they need to get more from less and you can get more from less if you’ve got all A players but you can’t get more from less if you have B players.

The other thing that came up that’s kind of fun, it’s kind of off topic Peter, but I just thought I’d throw it out is at my roundtable I had, there is one CEO who couldn’t care less about corporate culture and he’s a bit of a hard nosed guy that’s, “Let’s make all the money we can and people are expendable and disposable and on…” Anyway he said in one of our – when we go round-robin, he goes, “You know what; I need to get all A players,” and I raised my hand and I said, “Excuse me, but how do you expect to do that?” And he goes, “Well, I’m just going to go get A players.” And I said, “Well, do you think that you’re an A company.” And he goes, “Well, of course.” And I said, “Explain to me why you think you’re an A company? Do you care about corporate culture?” No.

“Do you care about your people?” No.

“Do you only care about profits?” Yup. And I said, “That does not make you an employer of choice. If you’re a B company expect to attract B players because A players could smell out a B company in a minute.”

Peter: Especially the Gen-Yers.

Kim: Especially the Gen-Yers. You mean the snot-nosed hedonistic little brats that want a green planet virtual workplace and life balance?

Peter: Yeah, and the ones who don’t want to work in a cubicle farm, those ones.

Kim: Yeah, exactly, who happens to be the richest talent pool we’ve ever seen in our generation. Often when I give speeches and usually in the audience, 95% of the audience who’s usually baby boomers and it’s starting to soften up now and the value of Gen-Yers which I totally respect the Gen-Y talent pool. The boomers, they’re just like those little brats that how dare they want to interview me and how dare they think of themselves as a “Me, Inc.” world and all of this stuff, but then when I asked them, I said, “Yeah, let me just kind of bust you guys for a minute. Gen-Y is 30 years and younger. By the time you guys were all 30 years old, had you something outstanding because by the time I was 30 years old I had lived in eight countries and was a foreign correspondent, I’d interviewed Henry Kissinger and witnessed the gas chamber execution, all before I was 30 years old, but now I’m 54 years old, we have a tendency to forget what we did when we were 30. And when you ask that question and they reflect, they were like, “Oh my God, you’re right. I did some great things before I was 30.”

Peter: The Gen-Yers today, they saw what happened to their parents.

Kim: Exactly. Parents working 30 years and then just being dismissed or demoted or they’re stuck in the middle. There’s nowhere to climb, they can’t afford to retire and they’re miserable and the Gen-Yers are saying there’s no way I’m going there. It’s perfectly acceptable for them to change jobs now every 18 months. Often I’m asked by companies that are kind of old and stodgy about how do they attract Gen-Yers into their organization when there’s no ladder to climb, I say they change jobs every 18 months because they’re looking for a new challenge. If you want to keep them, they don’t care about going up; they care about going out. So change their jobs every 18 months, give them a new title, a new salary and a new challenge and you can keep them.

Peter: Kim, I want to ask you a question about the underemployed. What advice can you give to someone who has been either out of work for like 18 months or has worked in a retail job or taking just some sort of job to keep some money flowing in, how can they get back in the game? How can they get back to that VP level job? Good question, huh?

Kim: If I had an answer to that one, Peter, I would be a multimillionaire. I think the reality is, is all they can do is not take their foot of the gas and keep looking and treat every interview and every opportunity in their mind to say, “I’ve got this.” You’ve got to keep your energy up.

The problem with that advice however is I have seen chronic job hunters where they’re so focused on kind of doing the shotgun approach and so giving every interview 70% of their energy instead of being more laser and giving 100% of their energy. A great way to bond is at the end of the interview say two things; (1) would you mind I ask what your perception of me is, and then the second question is would you mind if I ask three or four questions of you. And that makes them stand out in the crowd because others aren’t doing that and that creates a – I mean most hires are based on rapport whether it already existed or you created on the fly and it’s very easy to create rapport on the fly if you connect to them as a peer.

Peter: And you know I think also a lot of these people are looking in all the wrong places; they spend their days surfing the job boards, which I refer to as frictionless job searching because it takes effort to pick up the phone and call somebody.

Kim: Right.

Peter: It really doesn’t take much effort to surf around on Monster or CareerBuilder and shoot your resume off a million times a day.

Kim: Also there’s a malaise that gets created. I was recently at an HR focus meeting. Part of the format was they go round-robin at the various tables and they stand up and say, “I’m an HR director and I’m looking for a benefits manager,” and/or someone stands up and says, “I’m a HR generalist with 12 years experience and I’m looking for an opportunity in manufacturing,” and they go – so half of the people that stand up are looking for things in the HR space and the other half are looking for jobs and again, I think it’s the journalist in me. I sit back and I’m like, “Holy cow!” Table 2, you’re a 12-year experienced benefits manager and table 19 is looking for a 10 to 12-year experienced benefits manager and they missed each other. I’m like, “Hello!”

Peter: Oh man, yeah that’s scary.

Kim: I want to do speed dating. I just want to grab them by the hand and put them together. I saw like four or five of these, it’s like, “Guys, pay attention!” I want to stand on my chair and say, “Excuse me, you go hold hands with her. You go hold hands with him.” But I think when they – if you drift into a malaise, you miss, both on the hiring side and the looking-for-work side.

Peter: One last question Kim, I think you’re in a really great position to tell us how the job market is shaping up for 2011 based on the reqs that are coming into your door and the activity that you’re seeing out there for hiring. Is this going to be a turn around year?

Kim: I am referred to by my team as being pathologically positive. I’m always the rose-colored glasses person. However, no, I don’t think this is going to be the turn around year. I think everybody wants it to. Everybody came out of the gate with high hopes because if you think about it, the root canal for a CEO is stagnation and you hear phrases like ‘flat is the new up,’ but I really believe that the C-levels are still wanting to keep their powder dry, so while they’re dying to grow, I think they’re going to continue and be extremely conservative.

To your point Peter, I do think that they’re looking for a talent transfusion so they’re looking to upgrade their existing talent pool, so that’s going to be putting more people out on the street and bringing probably already gainfully employed people over, so I do think that we’re going to see on a scale of 1-10, I think we’re going to see an uptake of about a 3.

Peter: Along with that, I think, and you’re starting to see this, the press and the Wall Street Journal and everybody has been talking about this for a long time – companies have a lot of cash.

Kim: A lot.

Peter: And what they’re doing with that cash is they’re going out and they’re doing acquisitions, they’re buying companies now, right?

Kim: Great point.

Peter: Instead of Apple going out and hiring a bunch of developers to develop chips, they go out and buy a company and bring all of that talent in house, right?

Kim: Absolutely. I think they’ll be a monstrous uptake in M&A in 2011. Monstrous uptake, already seeing it.

Peter: Yeah.

Kim: Yeah, so very good point.

Peter: Kim, thank you so much for taking time to speak with us and enjoy your trip to Fiji. Are you going to be writing a new book sitting in a hammock with one of those umbrella drinks? ☺

Kim: I’m not going to be able to spell Decision Toolbox while I’m at Fiji. I am working on a new book, however. Actually I’m working on two new books. One is called Bite Me 2 TLO and the other one is a take off on a phrase that a friend of mine said, it’s called Entre-Manure: When CEOs Drink Their Own Kool-Aid.

Peter, this has been a blast. Thank you so much.

Peter: It has been. Thank you so much, Kim, and have a great trip and look forward to catching up with you later.

Kim: Thanks again, Peter.

Kim Shepherd is the CEO of Decision Toolbox. You’ll find her podcast in the Inside Recruiting Channel of TotalPicture Radio. That’s TotalPicture.com.

This is Peter Clayton reporting. Thank you for tuning in to TotalPicture Radio. The voice of career and leadership acceleration.

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Peter Clayton, Producer/Host, is an award-winning producer/director of radio, television, documentary, video, interactive and Web-based media who has created breakthrough media for a wide array of Fortune 100 clients.