053 Should Accounting Firms Run New Hire Trial Days?

Welcome to my Aunt Margaret's living room with me today. You want to introduce yourself?

Hi, I'm Chad. I'm. Let's start again. Nope.

Yep, that's not how this show works.

Oh, it's like a one take thing.

One take baby.

Hi, I'm Chad. There, that's good.

It's not as easy as it looks. Running a daily pot, eh?

Well, some of us have more practice than others.

Okay, well, before this drags on too.

Long, today we're talking about trial days.

I've been a big proponent of trial days historically. Chad was the one that turned me on to them. This is trial days for new hires to figure out are they any good, Are they numpties? I want to know that ahead of time. Are we just not the right fit? That's a better framing than are they numpties? Hang on, wait, is this. Do we need to go back now?

No, no, that was a good intro. Now you play the music. The do do do do do music.

You don't get to start the music. Okay, hang on. That's not how this works.

Okay, let's start the music.

Yeah, you can't actually hear it. Like it doesn't actually play in the room.

It's like very cool that it kind of played in my ears because I'm used to it. Yeah.

Okay.

Anyway, that's not why we're here today. We're here today because.

What are you doing? This is my show. Don't try to take the reins here.

So Chad Davis, as the co founder.

Of Life CA in Canada, they're an OG cloud accounting firm that far too large at one point. We're up over 100 employees now.

Nice. Down to a smaller size story for another day. We had a lot of fun with trial days for many years and I know you and I have chatted about this in your accounting community and have talked about it at length outside and you wanted to have a quick 20 minute chat about the pros, the cons.

And is that changing? Is like the culture around trial days changing? So like 10,000 Foot View. Why I love trial days is if you've ever made the wrong hire, you know how much time and energy you just flushed down the toilet when on the first day that person didn't work out. Even worse 12 months in, that person realizes this isn't the right job for us. Or you realize this is the best fit. That's right. So like, especially when it comes to accounting where how do you fundamentally know a person's attention to detail and like the Quality of their work without having.

Seen them do the work.

Like, we are coming into hiring traditionally with so little information. And when you think about the amount of time that goes into recruiting, into training new people, into retention. Retention, it's a lot of effort. So that like, even if there isn't a way to get perfect information, any additional information for me is good information. So we would run trial days and, and try to be super flexible with people. Like, and for us it was just one like six hour day.

Yeah. Let's define this thing. Like, what is a trial work day? You like started high level, then you went right down. Let's, let's go high level again.

I wanted to like set a very simple example of it and then turn it to you because you know way more about this than I have. Because you've done like a kajillion of these.

I think we've spent. Again, we'll get to the part about paying it, but I bet you we've spent probably $100,000 on trial work days over the last decade testing out people and giving them the opportunity to work with us and doing that work. And it is, it has paid off so much. But we'll get into all that kind of stuff. It's, it's really fun, but. Okay, do your thing. And then.

Yeah, yeah. You keep taking over my show like this.

It's our show. It's our show now. Oh, there's the nervous tick. The watch that one back.

And a hundred thousand dollars sounds like a lot, but like, and, and this is like the counter argument to trial days is like, that's a lot of work. It's like it's a whole lot less work than making the wrong hire.

Yeah.

Or, or having someone decide that it's wrong for them really quickly. Right.

Yeah.

It's not always about you. It's about giving them the opportunity to meet you.

So we tried to do kind of.

A basic version of this where we would basically do like a six hour day with them. We try to keep it as low pressure as possible. We would get far from perfect information from these trial days, but we would have them do a quarterly bookkeeping project. We would have them review a set of financials that a junior prepared. We would have them write a sticky email to a client. We would have them join a meeting with all the other team leaders and do like this topical discussion. Like it was far from perfect information, but it was a whole lot more than any other, like way we had to gather this info and it was.

Worth it for us. Simply, if you went down the list.

Of these trial days we had where we're like, this is a great fit. And then we do the trial day and we're like, that was a close one. And in my mind, if like 1 out of 5 of those is that it is, it's worth, it's worth the effort.

It's so worth the effort. So if I could recap, you had a one day trial day that lasted six hours. So just short of a full day, you were able to offer them, call it three to five different avenues to showcase their efforts and their skills. And then that day ended. What happened after that day in terms of communication and review and anything else you can think of that you did on those days?

At the end of the day, everybody that was involved in the day immediately does a debrief of all of their thoughts and we capture all that stuff and then we always tell the person, like, we're going to get you an answer within a pretty quick turnaround and then maybe a couple of days later we'll come back to it and make a decision. If there's like other folks we're weighing, we try to avoid ending up in situations where it was like one or the other, but we would try to get that back to them as soon as possible. But like, we would formally capture, like, kind of how we felt they did in these different domains because we wanted to be able to use that as a feedback loop if there were like blind spots later on where we're like, ooh, this is something we probably could have sussed out better in the trial day. So we did try to like capture that stuff in a meaningful way.

That sounds really helpful. How did your team typically acclimate or feel about these trial days as they came out?

Our team loved it because, I mean, nobody likes like, having somebody come in and then obviously like being painful.

That's right.

And usually when you're hiring a new person, the goal of that person is to help the people who are already there to take some work off of their plate. Like, when you're in a position when you're hiring, it's because you need them and these people need relief. So my team was very motivated to get involved in it. Like, they appreciated being part of the process.

It's just like anything else where people.

Are going to have different opinions and you kind of got to manage that. But our team super appreciated it. Like, that was 100% A positive. And they even became like very vested in the process when something would go sideways and it was an opportunity for us to rethink what our process was.

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So you, you pieced out of your firm, if you were still developing and designing that process, knowing what you know now and like, what had worked and what hadn't worked, I guess what's one change that you would make to iterate that trial workday process?

I mean, the biggest counter argument to it is like, in this day and age, are there people who won't want to do that? If it were me on the other side of the equation, I would want to do it because traditionally going into a job, you have the same, like, information asymmetry where it's like, I don't really know anything about these people or this employer, but I'm just going to go trust my career to them. Where if it doesn't work out, like.

It'S going to be that hiccup on.

Your resume, like, oh, tell us why you had this job for three months.

I would love that. Having a little more transparency.

Again, it's not going to be representative of the real deal. And sure, like, maybe we could give them this phenomenal experience. It wouldn't be representative of the real job, but they're going to meet all the people they're working with every single.

Day in the process.

Like, they're going to see into it more than they would otherwise. So to be totally honest, I think what if we would make any modifications, it would be maybe thinking, like, more about, is there anybody who isn't engaging in the process because of this? And I honestly, like, we didn't have the same volume that you did running through this. And the whole reason that you're on this show right now is to tell me about your experience about this.

I was hoping I stopped pushing this back on me by just interviewing you and then you'd be like, oh, crap.

He knows how much I love talking about myself.

This guy's. If you're listening on the podcast, he's looking at his watch every 10 seconds.

Yeah, because I'm trying to make sure we don't get this through this whole thing without talking about what I actually want to hear about from you. So, like, I don't know if there's a thing to change, but, like, we definitely needed to be mindful of. Were there any great people who are like, meh, like, I don't want to do that, or even if they did say that, is that like a signal? Is that like a negative signal? Like that. I don't know, they would be flipping about that or I don't know. So, like, there was maybe some more thought to give it there, especially as, like the, I don't know, like accountants are more and more in demand and like, I don't know, it feels like that side of the equation has gotten harder. But now's your chance.

Now you get.

Yeah, enough of me talking about what I've done. How did, like, your day, trial days develop? You do way more of them than I did. And like today, because this is probably the most relevant for this conversation, like today, like, are there friction points in doing that? Has the right answer changed with how the state of work has changed in the last five days?

Five.

Five years?

Yeah. I mean, you and I have chatted a lot about ebbs and flows of accounting firms, and I've noticed a trend where about every 18 months, like, we tended to like, reinvent ourselves. Really look at what services we're offering, what are we doing operationally, how are we pricing? What does next year or the next year and a half look like? And we tend to make pretty big decisions. And there became a point, and we'll get to trial work days in a second. But you asked about today, like, there became a point during the pandemic where it switched from, you know, a market where employers could be very selective about who they picked to the opposite of that. And I think because of that, we had to augment from these really heavy lifted trial day processes, which we can go through in a second and move to something that was more in tune with the market. So just as like, the market in general is trending towards gig economy, part time, flexible work, contractor versus full time employee, like, there is this trend of like, oh, if you stay the same way that you've always stayed, you're going to lose out on a big chunk of the market that's growing up right now and changing their preferences. And I think the average age at our firm was around 30ish, 34 somewhere in there. And like that is in tune with like the, the age of people who were just like not up for doing like a full two days of heavy, of heavy work.

So it was a full two days in your case.

Yeah. And we can get to that like a second. But like about today, it's like we, we changed from. We actually got. Once you get rip, we stopped doing trial work days and now we're into doing the most important elements of the trial work days that gave us the answers to are these people. Okay, okay. And now with ChatGPT and with AI rewriters and with all that other stuff, you just know that like the quality of the stuff that's coming back is.

So much better in the interview process.

Yeah.

Interesting.

Because of this. So now the take home tests are no longer and we have to like reiterate again. So I know like, you know, doing this episode is really fun because it talks about like how it changes and like we've been doing trial work days since our very first employee requested them.

Wow, what? Your first employee requested them?

Yeah, like four days. And like we did four days. We never did four days again. But it was like. Yeah. And it's been two days ever since. So at a really high level. What had worked for 10 years was the first day and this iterated as you got better. But it was, it was an older, it was essentially the first day was all about prioritization, judgment, learn, doing a bookkeeping exercise or an exercise for whatever role was they were being hired for. Same as you like write a sticky email of like there's a situation where you have to, you know, email not just the controller that you made a mistake on, but the customer and then the actual client that you overpaid. Like it was a really weird one but like you had to navigate three different types of users and like at the end of the first day you would get done and you'd. It would be about a six or seven hour day on paper and then they would finish their work. Our team which was assigned to this. So like there was a rotation of people involved because you couldn't always have the same people because of the amount of people that were going through. But there was, let's say one or two people that were charged with having a review of the bookkeeping work. And then they. As soon as that person logged in for the second day, they would get all their feedback the first day. Oh, and we didn't want, like, perfect people all the time. We wanted people that would take that feedback and make changes during the second day. Yeah, those typically were the things that aligned with a really good, like, I don't know, it matched with their chances of success. If we looked back at all the things that would make a longer employee or a good employee. And then the second day was like, doing more, doing harder stuff on the bookkeeping, there might have been, you know, tax thing or another judgment thing, but they got to meet more people on the second day, which was nice. And then once they got to meet their people and they met all, they finished all the work, we did a debrief with them and we would have feedback for them at the end of that second day. So like what, a half an hour, an hour between their, like their finishing of the day. And when we talk to them, somebody would deliver them feedback and like, cool. Here's your feedback, and here's what went right. Here's what went wrong. Here's what we can improve on. If you were an employee here, and this is the type of environment that you'd be a part of if you joined. And that really stuck with a lot of people. And then for ones that it didn't, it was a really good qualifier. Yeah, the things that worked really well, secondly, was that it was paid. So we'd pay them like 250 bucks to do this, but at the same time, it was two days, so they would have to take vacation or call in sick. And that just became. It was always a friction point, but for people that were looking for this type of role, it was like, really good. Then the economy and the market changed from an employer centric one to an employee centric one. And that all just kind of changed. Hey.

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Sorry. If we go back a little bit, the selection process, you know, Slack has all these little bots that you can do surveys on. Well, we used one called Polly, I think it was. And people would put all of their feedback to five very objective questions, not subjective ones. Like, would you hire this person? Yes or no? Rate this person one through five. What specific things did they do well? What specific things did they not do well on? And then like, just maybe one subjective question. But the majority of them were objective. We could put those together and sort of more definitive. So we could, like, average them out and keep data on them.

Yeah.

And then the hiring manager would make the ultimate decision. But the people. It used to be by committee in the early days, but then it turned out to be the hiring manager.

Okay.

Afterwards.

What of all the people that go through a trial day? Like, because as folks who don't have this step, they're thinking of like, okay, my current process of hiring, like, what additional people would I send through this? Or would I even send any additional people through it? Like, are half of the people coming through this and being hired? Are 10% of the people coming through this and being hired?

So when this was running at its height, they're the only people that would get a trial workday. Were people that we would. We would. We would be prepared to offer it.

Okay.

Based on the interviews. Yep.

Okay.

As the market shifted, we offered trial days to more people. And then when we weren't Having people accept the trial days because they were getting jobs from other people.

Yeah.

Because they were willing to make the offer right away.

Yeah.

We had to pull an audible and change then.

Interesting.

So like our HR team, fantastic at this. They were on top of making that decision and recognizing what the market was. The managers and hiring managers of all the, all the departments were on this. They were supportive of it. They know that the quality, like the quality is just different. It's a different experience. But it's matching what the market is.

Yeah.

And I think if you ignore that too much and you kind of put your head in the sand a bit about, oh, I'm, you know, this is, this is the only way I'm going to operate, you might, you might lose someone really good.

Yeah. So what did your pared back version look like?

So the heavy version was based off of a teachable lms.

Okay.

Right. And so we have like answers from hundreds of people that have gone through and done this thing. The new version is, it's by role now. So if it's a bookkeeping assignment, there's a bookkeeping assignment and maybe one writing thing. If it's tax, it's a scenario. If it's payroll, it's talking about like judgment and what are the rules. And like just, just some stuff to show that they're able to exercise some judgment but also know some technical work. But again with AI and questions and take home exams, I think that's going to be.

It's that noticeable. Like, like it's noticeably changed.

Yeah. I mean you can pretty much tell unless people are really good at their, their voicing prompts and tones.

Interesting. So, yeah, I think we had one situation where the person, it was going to be hard for the person to get that block of time. And we split that day over like two three hour days, you know, in the off hours. And like we kind of worked around that for them. I don't know if there's like a total like a perfect answer here. Besides, for as exciting as the upside is, like there is a downside.

Yep.

But the more you can mitigate that downside through flexibility, I think the more, the more you can frame this like genuinely through the lens of this is also an opportunity for you to learn more about us and how we work and meet the team you're going to work with.

That is this was always framed. You're nailing it. Like the framing of this trial day is for you, it's like 50% for you, 50% for us, and only good can come from this, if you're still interested. And I think like how you signal during the hiring process is like really representative of how you support during the servicing period. Right. So people that like go through the five or six rounds of interviews, I mean there's gotta be something pretty great on the other side in this market to go through that much stuff.

I mean that's worth talking about too. Like we had a fairly lean interview process leading up to this and maybe that's a way to get a bit of time back. What were like the pre screening steps before that trial day?

Um, so for a couple years we had a, like a talent acquisition person.

Okay.

And like they would do the screenings, they would do the sourcings, and then it would go to the hiring manager or like somebody else and then it would go to trial days. Okay. Now it's a little different with a lean down HR team. HR is doing the interviews and maybe there's a second one.

Okay.

Or there's a second one because we're more lean on the trial days. So it just depends on the position. I think we're like in a really big rush. We might rush the assignment out and I think that's just the world that a lot of firms are living in right now. Maybe, maybe a lot of them have figured out, but interesting that talent.

Yeah, it's gotten harder. Any like trends you've noticed like this year? Like, do you feel like it's paused at all or continuing on?

We've been, we've been lucky. The quality of the people that have joined is still really high. And like, I think about like why people leave, why people stay, why people join. And if you look at the reasons why people joined us over the like the first five years, it's almost the same reasons of why they're joining now, which is the people that are here to support them, the opportunity to work with some really great customers. The fact that it is like fully remote, I mean it's kind of, I won't say table stakes, but it's like more popular now to find a remote job and like everything is tech and systems and like it's a, it's a tech first type of mentality. And there's some elements that aren't like, aren't perfect, but the idea is like they're still joining for those reasons and are still just as happy three or six months later, I hope. But the trend I think over the last year, like from your question, is it's like there's, there's more qualified smart people that Sounded weird. Smart. Smart, like, really smart people that are just either fed up and they're leaving or they're. They're just looking for something new. And, like, we're lucky enough to get some of those applicants.

Hopefully there's, like, a higher bar, too. Like, hopefully, like, with people, you know, going through Covid and, like, could be.

Because there's all these layoffs, too.

Yeah, that's true.

There's more people in the market because of it.

But, like, if we've had this, like, reckoning of, like, not throwing our lives away on crappy jobs, like, hopefully there's a greater appreciation for, like, the right role. Because I think we lose so many people in the profession because they can't see anything besides, like, the meat grinder, and they just assume that every firm is going to be this, like, hourly mill. So, like, hopefully, like, I don't know. I. Like, hopefully part of the takeaway here is, like, a greater premium is assigned to the firms that. That are going about this the right way and, like, creating a better place to work and, like, less of a willingness to go to that crappy firm. And I think that's okay, and that's healthy, and that's understandable. Coming through Covid and putting all this in perspective. But, like, on the flip side of that, hopefully the firms that are doing this the right way and listening to their teams and all of that are ultimately rewarded by that newfound selectivity.

Yeah, I hope so. Just watching the trends and seeing what's happening over the next few years is. It's really interesting. And our HR person had never had worked in an accounting firm from an HR perspective before, but she's great. She gained a lot of experience and now really knows the industry really well and can help with a lot of the insights. And I don't want to make it sound like this is all stuff that, like, oh, we had all the answers, and, like, it was just one or two people that figured it out. It's like, it's the furthest thing from that. There's probably, if you looked at over the years, how many people were involved with designing, modifying, doing the admin to set things up, the admin to do reviews, and collating the data, and then talking to the team members. Easily 40 people to 50 people over the last decade that have had their hands in, like, making this thing work, and then the economy changes, and then it's all just gone.

Yeah.

So it's such a good reminder of, like, you can. You can really invest in something that's important for the. For the time, but if you don't recognize the shifts in the market to. What you said about, like, people finding the right. The right roles, it's. It's a mute point. And, like, you don't want to operate on a sunk cost fallacy that way.

Yeah, cool.

Cool.

Thanks for doing this.

Thanks for having me.

Anything else you want to do while you're here? You want to do an ad read or something?

Yeah. Yeah, let's do it.

You don't get to do an ad read.

Okay. Thanks for coming and hanging. Thanks for doing this, Chad.

You're kicking me out? Okay.

See you tomorrow.

You gotta wave like this.

Bye, everybody.