The Risk Mitigation Business

Vince Covino

Legacy Consulting

Boise, ID

vince@SuccedwithLegacy.com

Mr. Vince Covino is an investment representative with Prospera Financial Services, Inc. a SEC registered Investment Advisor. Investment Advisory Services Provided by Prospera Financial Services, Inc. An SEC Registered Investment Advisor

INTRODUCTION

I once sat down to dinner with a Risk Mitigation Expert that worked with several Fortune 500 retailers. He offered scintillating hors d’oeuvre conversation because the tales of what people would try to steal and the motivation behind it offered an interesting look at human behavior. These people were artists at deception—they’d been liars their whole lives, and only the truly skilled could strip away their personae. In a strange way, after being caught, these criminals were also in the Risk Mitigation business. Surprisingly, the majority of his work in dealing with loss for these companies was loss from employees. Getting the right employees was absolutely critical. 

The Employee ‘Interview’

Jokingly, I had him put me through this type of interview, and without hesitation he fired off the first question, “When was the first time you stole from the till—it wasn’t today, was it six months ago?” 

My eyes narrowed as the uncontrolled nervousness bubbled up within; a simple “no” response didn’t clear up the possibility of me stealing from the company today, and anything else implicated me at some time. 

I stammered a confused response, “I’ve never stolen anythi-….”

He interrupted through a subdued grin, not letting me assert my innocence. “Come on, it wasn’t a year ago, was it?” Complete with sympathetic disbelief. This questioning escalated for the next five or ten minutes in a pattern of sympathy, disbelief, assertion and offers to capitulate. His insistence brought me to the point of a re-analysis of all self-doubt.

From the very beginning of the interview or should I say, interrogation, I was on my heels, struggling just to articulate my honesty. The pace at which he methodically took me through questions didn’t give me much time for contrivance. He mentioned they typically have the employee on tape stealing from the till, or shuffling merchandise out the back door, so by starting without the informational asymmetry that goes on in a normal employee hiring interview, he had the advantage. 

The Prepared Employee Seeks Assistance

Great questions were the key to his discoveries, but he had another superiority; I was an unskilled liar. Dealing with people that have been consistently dishonest is a bit trickier than tripping up a guy who second guesses taking a spurious tax loophole for fear of an audit. I simply wasn’t well-equipped enough to convince him of my innocence—and I was innocent! Unfortunately, anyone hiring talent today struggles with a vastly refined group that not only knows the questions you are going to ask, but how to navigate around the majority of interview pitfalls. The Internet gives instant access to company research, a list of commonly asked questions, responses, and potential interviewer information all that give the candidate an edge. Candidates today are better prepared than ever before; however, business owners aren’t prepared enough to deal with them.

If you haven’t been trained in Law Enforcement Interrogation techniques outside your weekly patronage of Law & Order, then might we humbly suggest that you hire a firm that specializes in hiring, and that can show you demonstrable results through their system? Let’s take a look at how our system puts Business Owners in a position to make the right decision.

First, we take a look at your practice, and after some observation of the facts, we settle on what position you really need. DC’s get it in their head that they need someone for massage or to do sales; when their biggest need could really be to have a solid AR function. Business Owners, all of them, have blind spots; we help you see past them by taking measurements of you personally and then of your team. Second, we help you write the copy that will attract the candidates you want and deter the ones you don’t.

Third, despite all this, some candidates will still have delusions of grandeur, so our extensive behavioral and background research will cull out the undesirables before any contact is made (This is really where the special sauce comes in).

Fourth, we collect all this data in a format that’s easily accessible for our first interview with the candidate.

Fifth, we take an objective and removed approach to the interview that allows us to ask the uncomfortable questions that you would never ask. By the way, this stage of the process is also a tremendous liability for the interviewer. “Do-it-your-selfer’s” that ask the wrong question can violate the “protected class” status of a candidate and face Equal Opportunity Employment violations or potential lawsuits. 

Sixth, we question in a way that prompts for a variety of answers in an unfamiliar format to most candidates.

Finally, we package up our research and offer recommendations without the bias of nepotism, or the charm of the candidate. If we can’t agree, then you have the freedom to proceed at your own peril.

Some Questions To Ask

As a reward for slogging through this article, here are a few of my favorite questions to ask unsuspecting candidates. These normally put people in a “crisis” state wherein they won’t be comfortable in their responses. Armed with the behavioral and background intelligence we have collected, we feel like these questions put you in a good scenario to get reality.

• “In my experience, people who haven’t been kicked in the teeth in their lives don’t really have the passion required to be great at Sales; tell me about your failures.” I like this because people respond in kind to your questions. You’ve set it up here that you are really looking for Passion, but in reality this is the question you ask the candidate that has all the answers. You should get some honesty here, and if they don’t have some kind of failure story after this question then they’re schizophrenic; end the interview.
• “You’ve marked all of your attributes here as 10’s on a scale of 1 to 10; I appreciate the statement you’re trying to make, and we’ll come back to intellectual honesty in a minute. Pretend you had to rank these in succession; what would be the bottom three?” Implied dishonesty makes them feel as if they have to prove themselves; you allow them to save face by the “making-a-statement” comment, and you should get some real weaknesses here.
• (Phone Interview) “We’ve never met, but it sounds to me like you look a certain way (derived from their experience); I think in part your past success has stemmed from this—do people feel intimidated by you, and how do you make them feel comfortable?” Nobody that is good-looking wants to characterize their success based solely on their looks. The great thing about this question is, you haven’t seen them yet, so they are wondering how you know this while simultaneously trying to assert their greatness. Fantastic to determine if someone is a team player and how motivated they are.

SUMMARY

Because employees can be our greatest asset and potentially our greatest liability, hiring exceptional talent is easily in the top-five most important things you will ever do as a business owner. The right choice will propel your growth and drive innovation, but the wrong choice could cost you millions and bring an end to your business.