Why qualifications won't guarantee you a job anymore

By Neil Patrick

Research says there's an abundance of skilled technical workers in the US. Employers say they can't find enough people with technical skills...so who's right?

Last week I was sent a report by a friend. It was a lengthy research piece which reported an oversupply of STEM (science, technical, engineering and maths) qualified workers in the US.

Since he’s an engineer who’s been engaged in a very lengthy job search, he couldn't square this report with the constant allegations from employers that they can’t find the right people with the right technical skills. He thought something didn’t add up. And I agreed with him.

The findings in the report were consistent with other examinations of the STEM labor market. These found no evidence of a general shortage of STEM workers. (That’s because they weren’t looking at the right things as I’ll explain shortly).

STEM jobs remain scarce not workers

In 2012, in the US, there were more than twice as many people with STEM degrees (immigrant and native) as there were STEM jobs — 5.3 million STEM jobs vs. 12.1 million with STEM degrees. And only one-third of US natives with a STEM degree that hold a job do so in a STEM occupation.

Further, one-third of STEM workers do not have a STEM degree, suggesting that absence of a STEM qualification isn’t an insurmountable obstacle to many jobs in the sector.

Perhaps most tellingly, real wages for almost all categories of STEM workers have shown almost no growth for more than a decade. None of this is consistent with the idea that STEM workers are in short supply.

So why are employers reporting the opposite?

At the root of the problem is the fact that the researchers were academics. In other words, out of touch with the real world. In fact it was quite possible, they’d never even set foot in it, such is the way that universities often hermetically seal their research people away from business and industry.

So where’s the error?

The researchers had used the number of people holding STEM degrees as their prime metric to measure the total available workforce of techies, and on this basis they concluded that the supply was ample to meet the needs of employers.

Here’s why that’s a mistake…

Employers do not view educational qualifications as their key measure of suitability for employment. It’s a hygene factor. It qualifies you for consideration, not for hiring. So it’s perfectly possible for employers to say they have a skills shortage because educational qualifications alone do not make candidates automatically employable. They also require (rightly or wrongly) evidence of relevant previous work experience and personality fit.

Introducing the latest bubble…it’s higher education

We all know that the recession means that business growth has been in short supply over the last 5 or 6 years. Meanwhile the educational fat cats have continued to happily make money by churning out people with qualifications, even though suitable jobs have been too scarce to allow sufficient numbers to gain relevant work experience.

It’s a pipe, connected to a tap – the tap has been left turned on and the pipe has contracted (at least for the past few years), resulting in an inevitable blockage.

Source: ONS

The higher education sector has become big business. And like all big businesses, it’s hungry for constant growth. As the graph above shows, the proportion of graduates in the UK population has more than doubled since 1992.

The educational ‘export’ market has been a particularly lucrative business as the aspirational middle classes have massively expanded in the far east economies. Every time I set foot in a UK higher education institution, the place is packed with overseas students.

This bubble  is unsustainable...

My good friend and bubble expert Jesse Colombo has done a great deal of forensic work examining the education bubble in the US. I’ll just quote a little of his analysis here:

Even more alarming than the rate of tuition growth is the blistering increase in total outstanding student loans, which grew 511% since 1999 to $1 trillion (surpassing total credit card debt for the first time), with today’s average student graduating with 50% more student debt than graduates in 2001.

Student loans made by the federal government rose a white-hot 31.9 percent in the 12 months through November 2011. Even Moody’s is warning that student loans may be the next financial bubble to burst, while a recent FICO survey shows that two-thirds of bank risk managers are seriously concerned about the student debt loads held by students in the country.

For more of Jesse’s detailed analysis of this topic just follow this link.

When I went to university here in the UK in 1981, well under 15% of my peers did the same. And the state paid for it by means of a modest, means-tested grant with a contribution from my parents (thanks Mum and Dad) which I had to supplement by working at (instead of drinking at) a bar.

Back then, universities were not businesses. For better or worse they were state institutions. And they acted like it…they were slow to change and whilst they could spell "innovative financial leverage", they didn't really practice it.

But that was all set to change when government decided that it was a good idea (i.e. vote winning) to proclaim that university education was elitist and it was socially just to get more young people from less privileged backgrounds into the university system. It also appeared to be a handy way to reduce the growing numbers of the young unskilled unemployed. Instead of a glut of young people signing on for state benefits as soon as they left school, this would create a new generation of educated and aspirational young people, eager to take the economy to hew heights. Except this had to be paid for by them signing up to government debt, using what I can only describe as career mortgages.

The trouble is that whilst I agree with its egalitarian principles, this vision missed the vital recognition that this expanded output from the education system needed to dovetail precisely with the ever evolving needs of business and industry.

And that's where everything went horribly and tragically wrong.

So do we have a more employable population? Not quite. While the elite universities have expanded only modestly, protected their brand value and retained their high quality standards, there’s been an absolute explosion of less selective, lower quality degree courses made available to almost anyone who is willing to pay for them.

Young and old alike are both losers in this game. Oversupply of university educated people has created a glut of unsatisfied aspirations and debt for the young, and done little to provide businesses with the skills they seek in their workforces.

For the mature and experienced, it’s seen the perception of the value of their years of accumulated know how crumble in the eyes of employers who place the highest value on the most recent qualifications (provided this is backed up with recent and relevant experience).

Oh and of course the UK and US governments have also burdened each and every one of us with another massive government debt that will sooner or later have to be written off or bailed out...

How to transform your interview and defeat your competition

By Neil Patrick

If you think you know how to prepare for a job interview, think again. A recent survey of employers by job site Careerbuilder.com found that 39% of jobseekers failed because they didn’t properly research the company they were being interviewed by.

Whilst it might seem an obvious point that research is a key part of proper interview preparation, there’s a powerful secret extra benefit to doing this which I’ll reveal in a moment.

As Monster.co.uk points out, "Nothing is as disappointing as when a candidate oozes enthusiasm and then doesn't even know the most basic facts and figures about a company."

What’s more, in this digital age where so much information is freely available online, companies expect you to do this. There really is no excuse not to anymore.

What you need to know

Naturally, your aim is to appear knowledgeable about the company, its market position, plans for the future and the particular role you're applying for. With smaller employers especially, you should also reassure yourself that the company is financially sound.

It's also valuable to know about the culture within the company and a little about the person who’s interviewing you. You might just discover that you have connections, background or interests in common.

At the very least, their career history will give you valuable insights into how they are likely to think and what their particular focus at interview might be.

The company website

The first and most basic information source is the organisation’s own website. Any reasonably-sized firm is likely to have a blog or media centre. You'll find out what the company is doing right now, its products and services and how it markets them.

The website will probably also contain biographies of senior staff - possibly including your interviewer - and a list of important clients. If you extend your research to these clients, you can also pick up some very useful information that will enable you to talk knowledgeably at your interview.

Social media

Most companies now have a Facebook or Twitter account, and this can provide you with a good insight into the company culture. It's also very useful to look up the person that's interviewing you on LinkedIn. Do you have any contacts in common? If some of these are good personal connections of your own, it may well be worth having a private chat with them to get their insights.

Other websites

Job sites including Glassdoor and Inside Buzz, contain profiles of thousands of companies. Some have reviews written by current or former employees, which can tell you a lot about what working there is like.

When applying to small companies, provided you have some basic financial knowledge it is worth creating a Deudil account to check out the financial well-being of the company. That way, you won’t be blinded by any smokescreens by interviewers to cover up the real story. Make no mistake, companies in difficulty often keep on recruiting right up to the point of collapse…

Google is your friend…

The company’s website will only tell you what the company wants you to hear - and this may not give you the full story. Create a Google alert using the name of the organisation and/or business unit. This will give you daily updates of any news items about the company.

You can find out how your target company is doing by using Google searches such as "(company name) + research + share price". With luck, you'll find research reports about how your target company is performing, and some independent expert opinion on its prospects.

You'll need a context in which to put all you've learned about your potential new employer. So check out their competitors' websites too.

Get smart with social media tools

A valuable tool to help you establish the success level of the company on social media is Kred. I was recently talking to a client about their online marketing strategy. I showed them how their competitors were scoring higher than them on Kred and why. They had no idea this was the case. And this news made them really sit up and take notice of the plans I was proposing for them. Had I been applying for a job, this sort of insight would have been really valuable too.

How to use the information

After all this, you'll have a heap of information about your prospective employer. But you need to utilise it tactfully. Posts to the company's social media sites, may well include some customer complaints; unless the site's swamped with them, this doesn't automatically mean you should reject the company as a prospective employer.

Once you get into the interview, it may be tempting to try and showcase all your homework by dragging as many facts as you can into the conversation. Whilst this will make you look keen, it's much better to hold back a little and simply use what you've learned as and when it comes up. Your aim is to look as if you knew it all already. Where you've uncovered negative information about the company, a lawsuit, a fall in profits or any other negative information - it's best to avoid mentioning it altogether.

So, prepare, prepare, prepare!

I promised I’d let you in on a secret at the start of this post. And here it is.

A couple of years ago I was interviewed for an executive board position on a major UK plc.

Before the interview I wrote down every question I thought I might be asked, from the deceptively simple ‘tell me about yourself’, to the testily specific ‘what’s your take on the regulatory frameworks in the market’. And everything in between. I scripted the best answers I could come up with, polished them and learned them so I could more or less recite them word perfectly.

But I didn't just prepare answers, I prepared almost as many questions. I wanted the interview to be as much of a discussion as I could make it. And for that, I needed good questions. This would not only take the pressure off me a little, it would show if I chose the right questions, that I had really done my homework.

To find the right questions I really went to work on my research. I mean really went to work. I got hold of every news report and company statement I could find. I tracked the share price history. I used LinkedIn and other social media to discover the name and background of every senior person in the business. I researched their competitors. And their competitors’ strategies. I made notes on all the market sector reports and analysis I could find.

All in all, I think I spent about five full days of work preparing. But at the end, I was so prepared and ready, that I knew I would put on my best possible performance. When the day came and I sat in the reception area, waiting to go into the interview, I was calm, focussed and actually looking forward to the interview and having the discussion.

As it turned out, the interview was just between the CEO and myself. And it was the simplest interview I’ve ever had. It was more like a friendly chat than an interview.

And this was because my research meant that instead of me passively responding to a string of questions, I was able to not only answer every one, but also bring up relevant topics I had discovered through my research. And since most CEOs love talking about their companies, we ended up having an interesting and engaging discussion.

At a stroke, I had proved that I was super knowledgeable about the business and therefore interested and qualified. But critically, the interview turned into a two way discussion…and I’m certain that it facilitated a more meaningful dialogue as a result. I was no longer a passive participant - I was actively steering the conversation too.

Of course this couldn't have happened if I was being interviewed by several people or a panel. But the key point remains - proper preparation will make you more relaxed, more confident, and more knowledgeable. Do it thoroughly and the extent of your preparation will be clear, proving that you really want the job...in a positive way.

So don’t just think that research is about showing that you know a little about the company…do it right and you can change the whole interview process for the better and empower yourself too.

Show you mean business and let your competitors have the stress instead!

Recruiters need you…but do you need them?

By Neil Patrick

Over the last few days I have been spending a lot of time talking to recruiters about their businesses.

And I discovered things about them which are not typically well understood by job seekers.

Since they hold the keys to many job opportunities, I think it’s worth knowing a little about the different types of recruitment firms and how they function. If we feel they have not served our interests well, it’s not because they are wicked or unprofessional people (even if you have had some unhappy experiences), it’s because they are distinctly different types of businesses.

And of course because we are not their clients, we are their voluntary raw material.

Their business model determines how they behave with candidates

Different businesses function in different ways. So if you know what type of recruiter you are dealing with, you’ll be much better placed to understand what to expect and whether you should invest a lot or a little of your time in dealing with them.

How do you know what type of recruiter you are dealing with? If you ask them and they tell you, ‘I’m a head-hunter’, or ‘I’m a contingency recruiter’, what’s the difference?

And most importantly, what is the likelihood of each one actually landing you a job?

Here’s my five minute briefing which I hope will answer these key questions.

Placement agencies that charge you a fee

These agencies collect a fee from you, in exchange for arranging the entire placement process with potential employers. They typically handle lower-level jobs.

Many people have been burned by these types of agencies sometimes losing thousands of pounds. These types of companies prey on desperate job-seekers who have little or no other information at their disposal.

Any recruiter that asks you for any fee means that you should treat them with the utmost caution. Better still run a mile in the opposite direction!

Contingency based agencies

Contingency based agencies are also known as employment agencies and commonly recruit for administrative level jobs.

They seek suitable candidates by matching your qualifications and skills with their client’s requirements. If the criteria match, an interview is conducted followed by a background check and the taking up of references.

Some employment agencies charge a flat fee to the client company, while others take a percentage of the candidate’s first year’s salary. In most cases, the candidate serves a probationary period and the agency is only paid once you’ve successfully served your probationary period.

Now the bad news. Contingency based agencies are usually competing with others to place their candidate. And thus it often ends up as a numbers game. Their view is that putting as many candidates forward as they can gives them best chance of success.

Contingency agencies are also dealing with the lower end of the salary scale. So their fees are also much smaller than firms dealing with executive and managerial roles. For a candidate, this means you cannot expect much if any support from the agency and that you will likely be one of many candidates they find and put forward.

So what are the numbers? A contingency recruiter will typically take a fee of 15-20% of the first year’s salary.

If a contingency recruiter contacts you, what are the odds of you getting hired? 1 in 10 was the figure quoted to me. Sometimes it can be as low as 1 in 25. And if multiple agencies are involved, the figure may be even lower.

Retained search agencies

Retained agencies usually handle senior positions. These agencies are also known as executive search firms. The fee that a client company pays to a retained search agency is non-refundable and a part of it is typically paid in advance for carrying out the extensive searching needed. The remaining amount is paid once the client company hires an employee.

A retained search firm is a different proposition for the candidate. Typically, only 3-5 candidates will be put forward for interview with their client. And the agency will want to try and ensure that every single one is a good fit for their client. They also typically have a solus contract, so no other firms are involved. If you are approached by a retained agency, you should take it much more seriously than a contingency recruiter.

A retained search agency may well receive as much as 30% of the candidate’s annual salary as a fee. So for a £100,000 a year post, that’s £30,000. If you are dealing with a retained search agency, it’s not unreasonable for you to expect and receive some good support and help from them, assuming they consider you to be a good fit for the role.

If you are put forward for interview by a retained agency, then your odds are around 1 in 4 of getting hired.

Outsourcing

In the UK, James Caan (known for his Dragons' Den role on BBC television) was the first to develop Recruitment Process Outsourcing (RPO) in the 1990s and still offers global RPO solutions with his business partners Jon Bennett and Rachel McKenzie through his company, HB Retinue.

The popularity of RPO continues to grow as HR teams seek to spend more of their time on strategic activities rather than the fluctuating needs of their employer to find and hire new staff.

Outsourced recruitment specialists also suit small organizations without the facilities to recruit. Typically, a formal contract for services is negotiated with a specialist recruitment consultancy. Recruitment process outsourcing may involve strategic consulting for talent acquisition, sourcing for select departments or skills, or total outsourcing of the recruiting function.

The solo headhunter

These are similar to retained search agencies, but work on their own. From a candidate’s point of view, they have a great deal to offer. Although they do not have the resources of a larger firm, they work on a small number of assignments at one time.

They may arrange a meeting or a formal interview between their client and the candidate and will usually prepare the candidate for the interview and help negotiate the final deal.

A good solo headhunter will expect to place around one in three of their candidates.

Strategic talent acquisition

This may sound like a load of jargon, but it’s a distinct category of specialised recruitment. The way this works is that these people aim to secure a team with specific skills from a competitor. They thus set out to acquire a complete team that enhances the value of the business, whilst reducing that of their rival(s).

Such people are often an integral part of a firm’s management team and are found in specialist areas such as financial trading, sales and technology. If you're currently unemployed, it’s unlikely you’d be targeted, but if you work in a high performing business in these sectors it’s a distinct possibility.

The success rates are also correspondingly high…congratulations, you’re in demand, so you are in the driving seat!

Temp agencies

Sometimes temp agencies are also called staffing agencies. They hire candidates to fill temporary positions. This may be due to seasonal increases or an employee leaving the organization on a temporary basis e.g. for maternity leave. Usually, the client pays an hourly rate for the candidate it hires. The temp agency will pay the candidate’s wages, benefits etc. and add this fee to the bill they send the client each week or month.

Only a minority of candidates will be interested in short-term contracts. So if you are willing to take up such a post, you’ll likely have fewer competitors than for a permanent position. And there’s a hidden bonus too… many part time hires end up becoming full time employees, either in the same post or another which opens up whilst they are on contract.

Niche recruiting agencies

Specialized niche recruiters seek staff with a narrow specialty. Because of their focus, these firms can very often produce superior results due to their ability to channel all of their resources into networking for a very specific skill set. This specialization allows them to offer more jobs for their specific demographic, which in turn attracts more specialized candidates from that specific demographic. These firms invest resources and time in building large candidate databases.

Therefore, if you have a specialised skill, then building a relationship with a niche recruiter is an excellent long-term career investment. These niche firms tend to be much more inclined to develop ongoing relationships with their candidates as it is very common for the same candidates to be placed by the same firm many times throughout their careers.

So there you have it. A five minute explanation of the world of recruiters for job seekers. They are not all the same and for good reason – they all work to different business models, ranging from the exploitative through the high volume number crunchers to the super-specialised and professional.

I hope that this post helps you know the right questions to ask next time the phone rings and the voice on the other end, says , ‘Hello, I’m a recruiter...’

How recruiters use LinkedIn to headhunt

By Neil Patrick

What goes on inside the head of a headhunter?

Last week I met up with a recruiter who is an old friend of mine. He’s been a recruiter for over ten years and for once we had time to just chat. That’s a rare situation, so I took the opportunity to quiz him about how he and his colleagues use LinkedIn to search for job candidates.

Here’s what I found out:

Recruiters use LinkedIn all the time to find the candidates they seek

If you want to be recruited, you need to be on LinkedIn. But that’s simply not enough. You need to be an active rather than a passive user.

According to a survey carried out by Bullhorn, 48% of recruiters ONLY use LinkedIn for candidate searching vs. 1% that use Twitter and Facebook.

So it’s clear which social media platform job seekers should prioritise.

What’s more, on average, recruiters add 18.5 new LinkedIn connections every week. And you want to be one of them.

ACTION: If you’re not already on LinkedIn, set it up now. If you already have a LinkedIn profile, the following tips will tell you what to do to become more visible and impressive to recruiters.

So how do you go about this?

LinkedIn isn't everything, but it is more or less universally used by recruiters. Recruiters often have several thousand first degree connections, which expands to an immense network of people at the second and third degree.

ACTION: You need to have your relevant recruiters in your LinkedIn network. I know that’s harder to do than say, so I have provided a cunning strategy to help you do this here.

Recruiters use keyword searching by geographic location

Recruiters use LinkedIn's Advanced People Search function to find people within a certain geographic radius who possess the skills, education or experiences they are seeking for their clients’ roles.

Now if you perform a search yourself using keywords, your results will be different to a recruiter’s because the LinkedIn Search algorithm customizes your search results to you based on your network.

A partial solution to this is find a friend that doesn't have your in their LinkedIn network, but is a member of LinkedIn and ask them to search the keywords relevant to your area and find out where you come in their search results.

Next look at the top half a dozen results and see what their profiles, group membership and postings look like. These will give you a template to apply to your own profile and activities.

What matters is that within a radius of say 50 miles, you rank on the first page of Linkedin results when someone carries out a search for your key skills.

ACTION: Don’t just fill your profile with keywords. Instead, incorporate them into the bullet points that describe who you are, what you've done and how you have achieved it. Monitor your rank position, and aim to get to page one. If you are on page one, already aim to get as close to top as you can.

Recruiters join industry and skill-based LinkedIn Groups, and monitor the discussions

They use this tactic to quietly observe what leaders are talking about, and who else contributes to the discussion. This way they can see who really has the knowledge and the skills that they seek. Moreover, they can see who is actively sharing it.

ACTION: Join LinkedIn groups relevant to your skill set and industry to keep up with what is going on, and make constructive contributions to the discussions.

Recruiters follow thought leaders and key influencers

A significant part of a headhunter's value is knowing "who's who" in a particular field.

My friend freely admitted that his biggest personal asset was his huge network of contacts. But he doesn’t just build contacts randomly. He targets people that he can see are the thought leaders and biggest contributors to specialist insights.

So recruiters collect contacts and this is a key reason that you should always aim to nurture your relationship with a recruiter, even if you have an experience which doesn’t initially result in you getting hired.

ACTION: Follow the people whose status and specialism will reflect well on you. Don’t worry if you are not a thought-leader yourself…yet. Your association with those that are will build your profile and make you more visible to recruiters.

Recruiters follow their connections' LinkedIn behavior

Part of the headhunter’s art is understanding the timing of what is going on in people's lives, and the signals they give off which demonstrate that they are open to an approach.

Recruiters are alert to people's LinkedIn behavior patterns to determine when someone is about to begin a job search. Sometimes, a tip-off is obvious, like when a person checks out a recruiter’s profile… or, when someone who has been quiet suddenly starts making frequent status updates.

ACTION: Often people are nervous about letting their current employer or others know that they are in the market for a new job, for good reason. Get smart. You don’t have to proclaim “ I am looking for a new job” to put the right signals out to just the people that matter.

Not all recruiters ignore those who are currently unemployed

Yes it’s true that many recruiters are only interested in those that currently have jobs. It’s unfair and it’s not the best decision in my view. But it’s a fact.

But not all recruiters think like this, especially in the wake of the recession, when so many talented people found themselves unemployed through no fault of their own.

ACTION: Whatever your situation might be, focus on the positive. Demonstrate your knowledge, and your leadership. Capitalize on the fact that you probably now have more time than usual to invest in some powerful personal brand building. 

You can use the latest features of Linkedn to upload presentations and videos that showcase your skills and insight. These can really set you apart, so use them.

Present yourself as a professional (who happens to be currently unemployed), rather than as a person who used to be whatever and is now out of work.

Recruiters don't want to guess

Don't make recruiters have to guess about who you are and what you have to offer. You know exactly who you are but they don’t. And they don’t have time to solve riddles. But avoid the temptation to try and present yourself as someone you are not. Sooner or later you will get found out and you’ll be wasting everyone’s time including your own.

ACTION: Be completely clear about who you are and even more clear about what value you can deliver in your LinkedIn profile. Keep your profile up to date and build long-lasting relationships with quality recruiters.

I have written a post which reveals some secret strategies for using social media to build valuable relationships with recruiters here. Just remember that everything you do online is key to building better professional relationships in the real world.

See it as nurturing your career asset rather than just solving today’s problem and you’ll not only land your next job faster, you’ll be creating a long term career asset which will pay you back over the long term too.

How a failure in selection processes can bring down a bank

By Neil Patrick

Poor governance allows bad leadership choices. And bad leadership choices risk the destruction of a whole business.

This week has seen the conviction of former Co-Operative Bank Chairman Paul Flowers for possession of class A drugs. Specifically, cocaine, crystal meth and ketamine. The mass media has had a field day with the story, but the scandal isn’t the part of the story I am most interested in.

The most intriguing question for me is how was it that Paul Flowers, who had no experience in banking was ever appointed at all?

This drugs scandal is just the latest in a long series of misjudgements which beggar belief for a man who rose to hold such a senior position.

Here’s an extract from the Wikipedia entry about Paul Flowers:

Soon after the filming of Flowers’ purchase of non-medicinal drugs was released to the media, it was revealed that, while deputy head of Social Services at Rochdale Council, Flowers had known about the activities of paedophiles at a residential boys' school, but had neither informed parents nor taken measures to close the school, was responsible for rejecting allegations of child sex abuse by the late Cyril Smith, and that, in 2011, while working at Bradford Council, "Inappropriate but not illegal adult content was found on a council computer handed in by Councillor Flowers for servicing. This was put to him and he resigned immediately."

Several newspapers reported allegations that he communicated with rent boys using his work email account while he was in charge of the Co-operative Bank, and was convicted of carrying out a sex act in a public toilet. After the bank lost £700m in the first half of 2013, and a £1.5 billion hole in the bank's finances was discovered by the new Chief Executive Euan Sutherland in May 2013, Flowers resigned in June 2013.






At the root of this crisis is bad governance and weak HR

How can it be that a person with such a background was appointed to lead an institution whose core ethos is supposedly based on fairness, transparency and good ethics?

He was voted in unanimously by his peers, but also was judged by the FCA to be a fit and suitable person to be a non-executive director of a bank.

According to some of his former colleagues, the former Reverend Flowers allegedly got the job because he did well in psychometric tests, despite lacking the financial knowledge of other candidates for the job.

Rodney Baker-Bates had experience of banking but lost out to Flowers because of the tests. A review of the bank’s governance decided leadership was more important than financial knowledge.

So Baker-Bates became one of Flowers’ deputies alongside David Davies, both appointed to keep an eye on the chairman and provide financial expertise.

When questioned, they told the Treasury Select Committee that they were ignored, and both said they would quit the board after the lender voted to buy 632 branches from Lloyds in 2012.

Baker-Bates said, “I set out to convince the board that the Lloyds branch acquisition was a giant step too far, and it was over-laid on another major error, Project Unity - which was intended to bring bank and group leadership together.”

How can it be that Paul Flowers passed the psychometric tests?

The most reliable form of psychometric testing, the five factor model (FFM) quantifies the extent of each of these personal characteristics:

• Openness: intellectually curious, prefer variety and novelty, active imagination
• Conscientiousness: dependable, prudent, methodical, achievement striving
• Extraversion: sociable, talkative, excitement-seeking, warm
• Agreeableness: sympathetic to others, cooperative, trusting
• Neuroticism: emotionally unstable, anxious, irritable, impulsive

If such tests were applied properly and evaluated correctly in the case of Paul Flowers, then why was he ever appointed? Someone, somewhere either got this wrong, or was overridden, with disastrous consequences.

What does the future hold for the Co-operative Bank?

Last year the Co-op Bank had to be rescued after it was left with a £1.5bn capital shortfall, with many of its troubles stemming from the merger with the Britannia building society in 2009.

Despite this bailout, the cumulative impact of this mismanagement means the capital position of the bank remains precarious:

This week we learned that the Co-op Bank will pay four of its largest hedge fund and institutional investors nearly £2m to support its £400m capital raising effort to ensure the deal goes through without a hitch.

A failure in this capital raising attempt could potentially bring about the collapse or at least drastic restructuring of the entire organisation.

If the Co-op Bank were for some reason not to be able to raise the money, the Prudential Regulation Authority could put the lender through a wind up process that would likely see it split into a “good bank” and a “bad bank”, with the continuing operations handed to another major lender and the toxic assets put into run off.

So it’s been a tough week for the social media team at The Co-op Bank. And their customers are not impressed with the situation either:

As I have contacts with institutional depositors at the Co-operative Bank, I spoke with them about this today and learned that they are pulling millions out of the Bank as a precaution against its possible collapse. Such a collapse would be a sad end to a once ethical and genuinely different type of bank.

And it can all be traced back to poor governance and leadership selection processes. This isn't the first and it won't be the last example of why proper governance is critical to large businesses. But it is perhaps the best example yet of the catastrophic damage that can be done through the incorrect use of psychometric profiling.

The poisonous words that undermine your credibility

By Neil Patrick

The words we choose determine who we are to the ears of everyone we speak to.

I just read a post here at Fast Company by Hunter Thurman which proposed that overuse of the word "so" in business conversations undermines our credibility.

But I don’t agree with his argument that the word "so" is particularly damaging. Here’s an extract from his post.

Hunter argued that:

1. “SO” INSULTS YOUR AUDIENCE

That little head cock, slight furrowing of the brow, and set-up with “so” says to your audience, “I’m trying to dumb this down so someone like you may have at least a chance of comprehending the importance of what I do.”

The person with whom you’re talking won’t call you on it, because he won’t even consciously recognize it. But the convention we’ve all created around “so” will register subconsciously, and the damage will be done.

2. “SO” UNDERMINES YOUR CREDIBILITY

The “so” setup also announces: here comes the rehearsed part of my discussion.

It’s like a poker player’s tell that announces to your audience that they’re about to get pitched. This one is easier to observe than the insult I talked about above--just walk up to the first peer you encounter and ask him what he’s working on.

He’ll follow with, “So, I’m optimizing our UI to better convert... ”

It’s obvious that you just heard his “public” version of his current workload. The more honest answer might be something like, “I’m trying to figure out where one f-ing period is jagging up all this code... ”

3. “SO” DEMONSTRATES THAT YOU’RE NOT 100% COMFORTABLE WITH WHAT YOU’RE SAYING

Just as the “so” setup announces that this portion of the conversation will be very deliberate, it also demonstrates that you’re not as comfortable with your story as you think you are.

Rather than just plainly answering their question, you’re relying on the crutch of a practiced blurb. Usually, whatever follows “so” is a carefully crafted sentence, evolved over many iterations and audience reactions.

I do not agree. And judging by the comments on Hunter’s post a lot of people feel the same way.

The word “so” is a conjunction. And anyone who has a basic grasp of grammar knows the rule which says you should never begin a sentence with a conjunction.

“And” is also a conjunction. And I choose to begin sentences with it all the time. I know I’m breaking the rules of good grammar. But, (yes that’s another conjunction) I do so deliberately. I happen to think that blogging doesn’t benefit from the application of strict grammar. It should be conversational. It should be easy to read. It should flow. Plenty of top selling fiction writers know this. And they do the same thing.

Personally, if someone uses the word “so” at the beginning of a sentence in a business conversation with me, I don’t mark them down. I interpret it as simply meaning “what I am about to say has a causal relationship with the previous thing I said”. And that’s fine with me.

So, I think Hunter has arrested the wrong suspect.

But (yes I did it again), I agree with him that the words we choose to use determine how we are perceived by an audience. And I’d like to propose a list of villains that I think really qualify for incarceration.

How about these:

Like…

“‘I like horror movies” is just fine. “I’m like thinking” is not. For some reason, this has become the default tic of young females, especially in the US and UK. It implies youth, but also cluelessness.

You know?

This is just annoying. And a little insulting. Of course I know. You just told me (or are about to).

Frankly

The speaker is striving for the implication that they’re being honest. Which suggests to me they are not.

Right?

As a tic inserted in every paragraph, not only is it irritating, after a while the listener begins to wonder if you’re not trying to convince yourself. Right?

Literally

Another one which when combined with “like” promotes a quiet raging inside me. Some people apparently don’t understand what the word really means. They just use it for general emphasis. If you use it, you risk being dumped into the bucket with them.

I freely admit I am not without guilt as anyone who has spoken with me will testify. I'm perhaps the world’s greatest hesitator and at least half of my spoken sentences are prefixed by a great big ‘ummm’.

I know I do it and I try hard to minimise it. But I know I’ll never banish it completely.

And that is OK I think.

No, our real enemy is our unconscious use of the words which sneak into our vocabulary through others’ repetition and overuse.

The solution isn’t to banish words from our vocabulary. Or to apply strict rules of grammar. It’s to try and hear ourselves when we speak. Learn to listen to ourselves and make every word count.

You might think none of this matters in our normal day to day conversations. And I’d agree. But if we use these times to practice our mindful choice of vocabulary, we’ll be much better able to present ourselves credibly when the important speaking occasions arise.

So, it’s like you know, let’s literally think about the stuff we say. Frankly we’ll be perceived in a better light. Right?

How to make LinkedIn deliver what YOU want

By Neil Patrick

Linkedin holds the key to a world of opportunity for all of us, if we can just learn to accept one simple truth...

I discuss LinkedIn a lot with my offline network.

I also chastise many of my professional friends for their failures to take it seriously. The main reason I do this is that they only think about it when it is too late. Like when they lose their job, or are struggling to progress some aspect of their career or business.

LinkedIn cannot and will not deliver benefits for you if you only turn to it when you desperately need help…unless you have invested already for months and years beforehand.

But if you have already made that investment, then you’ll have a network of relevant connections that can you can turn to. People who know something or someone that you need.

And if you have paid it forward, investing in helping others in your network, with absolutely no demand for anything in return, you’ll have their goodwill too.

But it’s not a mechanical process. It has an element of randomness about it for sure.

A few months ago I happened to see a particularly erudite and insightful comment posted on LinkedIn. I wasn't in any way connected to the poster. So I simply clicked ‘like’ and wrote one sentence of praise.

Total time invested? About 60 seconds.

The poster happened to be a very senior investment banker. He invited me to connect which I did. Several emails and phone calls flowed from this over the following weeks. We had an easy rapport. We got to know each other properly. We discovered how we could collaborate and be of value to each other.

We now have a very productive business relationship, where we provide real value to each other.

In the real world, our paths would never have crossed.

Today, I know I can pick up the phone to him at any time and discuss anything where I think he can be of help.

That’s just one example. I have dozens more similar stories I could tell you. Every relationship is different, but they all started in the same way…a more or less random encounter on social media.

And this is why I think people struggle with seeing the value of social media for their careers. If you’re in manufacturing, you think in term of raw materials, processes and the value of goods you can sell. If you are more financially focussed, you want to see the return on every investment you make. If I spend this…what do I get back?

But this misses the point entirely. I accept that 90% of the connections I make on LinkedIn will never create any value directly beyond some friendly exchanges and perhaps a tip off here and there. But by the same token, 10% of them will be priceless. I just don’t know which ones. And I never will.

Pharmaceutical firms view their businesses in a similar way. They invest billions every year in research and development of new drugs. And they know that 90% or more of them will never get to market, let alone earn them any revenues.

But they also know that they only have to have one which does make it through to generate millions or even billions of revenues in the future. And so they continue to invest steadily in potential new treatments, in the full knowledge that most will fail.

It’s exactly the same with LinkedIn. You only need one job, one person, one exchange to transform everything and change your prospects. One change to your profile can transform how others see you. One comment can lead to a world of opportunity.

And the only way that will happen is if you invest steadily every day in a way which makes sense for the outcomes you are seeking.

If you are mindful and focussed, you will achieve the outcomes you seek.

Just don’t expect LinkedIn to deliver unless you have committed to it with a purpose from the start. And paid your dues.