Originally posted at Ascent Advisor
Peter Wride – Ascent Advisor: HireVue makes the bold assertion that everyone from the CEO down to the candidate is going to love this product. What makes HireVue unique and special?
Chip Luman: For a hiring manager, whether a busy executive, or an even busier front line manager, we save them valuable time. Imagine you have 10-12 direct reports to manage and you also have to spend time interviewing someone new for your team. The old approach would be to work with an HR partner to schedule interviews and then try and fit in several candidates for phone calls while still doing your day job. Our platform allows candidates to complete an interview via computer or mobile when it is convenient for them and managers to do the same. All the candidates are provided the same questions. That’s an apples-to-apples comparison of the skills you’re looking for and it allows you to make better quality decisions. You can also end an interview after 5 minutes if the candidate is not qualified. You can’t do that when you are on the phone or sitting across from them. Managers can also use our live interview for the next step as a way to avoid travel costs. Our platform lets you invest time with the right candidates.
Interviewing is something that every business manager has to do at some point. They may interview once a year or a hundred times a year, and our platform makes it easier and makes it better in both cases. That is why it’s been exciting, people think it’s a tool for HR or recruiting, but it’s the end users, managers, who get a lot of the benefit. They are the person making the actual hiring decision and a lot rides on making the right decision.
Ultimately our product solves a business problem. We simply make the hiring manager’s life better. We’re all busy and we can’t afford to waste time with the wrong candidates. Our platform even allows you to watch candidate videos (interviews) on an airplane!
Ascent Advisor: Prior to joining HireVue full time in 2009, you were on the board. What made you decide to leave an executive position at a Fortune 500 company (SVP of Shared Services and Total Rewards at Charles Schwab) and enter the fray of a start-up?
Chip: Digital interviewing began for me in 2005, when Mark Newman [HireVue Founder] cold called me to sell me the product, and he sold me alright! I got really excited about the concept and how it could really change the recruiting process. I ended up joining the advisory board and eventually the board of directors. In 2008, circumstances and timing aligned that Mark and I decided it was time to raise our first round of capital so I left my executive HR role at Charles Schwab and joined him to raise money.
I was really excited about HireVue because it addressed a business process [interviewing] that is very manual, with lots of different steps, kind of out of control, and brought order. HireVue aligned with who I am. I’m a process person. I love to understand and work on what makes businesses function better. My career started out at Marathon Oil, which at the time was owned by USX, a big 100+ year old Fortune 20 company. Then I went to Pepsi and was part of a company with a half a million employees. Good process was vital in business environments like that and I learned from some really great business leaders. I left Pepsi and joined Acclaim Entertainment, a video game company that aligned with my other passion, technology. I like how technology can make jobs easier and/or eliminate people from a manual process, freeing them up to do more strategic work.
HireVue does this. If you’re shuffling through phone screens all day you might be able to do 8-10 if you are really good at scheduling… if we can now let you get to 40, we just made your life better and you can focus on higher level work. I’ve always loved that technology aspect of improving things. Of course now I am a bit dated when I tell the stories about using floppy discs and getting permission to take the brick cell phone on a business trip. I’m a Grandpa gen-xer that carried one of those suitcase sized laptops!
When Acclaim closed, I joined Schwab, a great opportunity, but the business was in trouble. I’m a turnaround guy. I like to break, tear apart, fix, reengineer and build. I like the ability to see fast system feedback. If I’m sitting in an organization where everything is humming and rocking and with all things working, I’m bored silly.
Schwab went through a significant reorganization in 2004. I had the opportunity to do a lot of heavy duty change management work in a big corporation which, had it not been in crisis, would have never happened at the pace that it did. I had a great team and we were able to implement a lot of new technology, and the tech stuff is what really drives me. Mark found me at about this time and all of my passions aligned with the HireVue concept, my love of technology, the emergence of SaaS, and my desire to get back into and build a small company. I took an entrepreneur class at Penn State, it was one of my favorite classes – it was one of those 8 am classes which were often a little harder for me to make it to – but that was one I got out of bed and went to. It was just something that really interested me. The Penn State Garber student VC fund actually invested in our A round.
I know this is a long answer but it’s the topic you wanted me to delve into. HireVue is exactly what I was looking for to bring all of the experience that I gained at bigger companies, but now apply it in a faster and smaller scale operation. And a really exciting thing is we’re in the midst of another fundraising drive here, and the feedback from potential investors is that we have pretty sophisticated, mature processes for a small company. This is because Mark and I built a team with similar larger company experiences and depth in our HR technology space.
Ascent Advisor: What are you taking from your corporate experience and bringing to this company? Is there anything you are intentionally leaving behind?
Chip: One of the things – this is a function of where Mark and I clicked early on – that I believe in is transparency and over-communicating with the team. I learned this at Pepsi, a very results focused and transparent organization. Often times in organizations, as a function of size, information can’t travel quickly. Mark is really adamant that everyone is a member, not an employee, because he says employees are generally viewed as a cost. Members are part of something bigger. My management perspective is I hire smart people and let them do their jobs. I’m here to make their life easier, and provide them with the information and resources they need for success. What I don’t like about some big companies is the “gotcha culture”, spending more time trying to catch people doing things wrong as a way to capitalize on resources from others by showing how much they screwed up. We have fought hard to keep that “we’re all on the same team” open and candid environment. There’s nothing wrong with questioning things, in fact it is expected.
At HireVue I am responsible for everything with the client post-acquisition – client deployment, training, customer success, account management, voice of customer, support, basically taking really good care of our customers. I bring a passion for service that I gained from my time at Charles Schwab. I had the privilege of working with Chuck Schwab and saw first-hand what client passion could do for the bottom line. My team is empowered to take care of the customer with what they need for success. I don’t have a whole bunch of rules about spending or what we can or can’t do. This is another reason why I joined Mark Newman’s team. He said, “An interview is a potential life-changing event and everyone involved in that event needs to be treated with respect. It can ultimately make or break, change a person’s life by getting or not getting the job.” This sense of purpose and service to candidates was Mark’s deal closer for me and the way we continue to drive our business.
The big companies with a focus on the customer are great for a reason. Treat your customers right and that will come back with double, triple sized renewals and it does for us.
Ascent Advisor: It sounds like what you did bring, on the other hand, are the reporting, metrics, that don’t naturally grow in small companies.
Chip: Mark and I used to take support calls around the clock when we first started. Early on I was sitting in a board meeting and I mapped out what I was going to do with a call team when there were still just 2 people on that team. Enterprise level phone system, metrics, all of the things I learned as a member of Schwab’s call center leadership team. One of the board members kind of looked at me funny at the time, like “you don’t need this”, but now we have 24/7 service in multiple languages because we have global customers and we are easily scaling. Voice of Customer is also big for HireVue. We conduct a Net Promoter survey and score and it was 43 last quarter, which is high in our industry. Without this structure and process we wouldn’t be able to scale with our rapid growth we are enjoying.
Ascent Advisor: You wrote a blog for the SHRM network recently that says: “All managers inherently know the consequences of not recognizing and acting on top and bottom performance. Top performers will disengage more quickly, leave or turn cynical. The rest of the team will slip into a safety zone of mediocrity.” What have you done to engage top performers while helping the rest of the team not feel like the “rest of the team”?
Chip: For top performers, again, I believe you hire smart people that know how to do their job and you let them do their job, you are there to guide, prioritize, give them the resources they need to do, and you certainly recognize people with pay, but you don’t motivate people with pay. You motivate people with challenges, the opportunity to exceed and excel and learn on the job. I try to have those people around me all the time, but everyone makes hiring mistakes, mismatch of culture usually.
For the others you need to have candor, honesty and transparency. The hardest thing for most managers to do is look someone in the eye and be honest with them. They may be concerned about their feelings but without giving clear, candid feedback people can’t adjust. There’s nothing worse than someone hearing feedback for the first time at a performance review at the end of the year or even worse when they are on the way out the door.
I try to address it in the moment with coaching and feedback. Before this interview, as I was walking down the hall I grabbed a team member who had sent an email saying “what do you want me to do?” regarding writing an email policy. I handed him the book Overload! How Too Much Information is Hazardous to your Organization and asked him to read it and come back and give me a proposal. Email “reply all’s” can drown the team. I used this opportunity to give a challenge and feedback since he was one of the people who would hit “reply all” a little too often. You have to be candid, you have to be honest, you have to have courage. Look them in the eye and tell them what is going on, don’t wait on it and don’t sit on it.
If a job is not a match and you have talked to the person, it’s time to let them go. You have to have the courage to fire people too. I have had many people on my teams that have gone on to other jobs and been incredibly successful.
Ascent Advisor: HireVue has gone through tremendous growth since you joined in 2009. What has been the biggest challenge with that growth?
Chip: Right now we are moving to that next stage in our growth and how we communicate information and keep people up to speed is a challenge. You can’t always run down the hall, it’s different now. We, as a leadership team, also recognize we are our own worst critics. We sit back and say “we didn’t do this, this and this.” We don’t do enough looking at our own public results. We now have over 15% of the Fortune 500 as customers. We’ve driven the hockey-stick growth, we have the customer accumulation and renewals. The toughest thing has been recognizing our success because we are so driven. We have a great team, we all push each other, the core leadership team is always on each other to excel.
The hardest thing is to step back and say “we’re actually doing really well.” At our quarterly meetings and our strategic off sites we ask ourselves what is working and what is not working. What’s not working is about 100 things and 5 things that ARE working. But wait a minute, this is working! It sometimes takes somebody else to hold a mirror up to see our success.
Ascent Advisor: Going from 3 to 100 employees (members per Mark’s comments), how do you get your employees to buy into the vision from the beginning?
Chip: I love our culture and all culture is function of the leadership. Mark and I both walk off the beaten path at times. We have a grill out back and I tell the team “You may want to check before you go to lunch because you may find steaks are planned for that day.” We have a pool table we earned for hitting our Q1 and Q2 goals last year. We have two super bakers and they are in competition for who can make the best baked goods. We had 6-7 home baked pies brought in for Pi Day.
We have our entire team into Salt Lake regularly (our sales team, marketing and some account management is all over the country) and every set of new employees comes into town for orientation, a data dump of everything, business results, business planning, business strategy, how to sell the product, how to serve the clients, everybody sits in, everyone goes through it. Everyone has to see and understand the vision.
We celebrate, we work hard and we play hard. We have an extremely diverse set of people, from all over the country and from all kinds of backgrounds and we really strive for transparency and candor. You say whatever you want, have a solution when you say what you disagree with, and nobody is put in a corner. People are allowed to have fun, you may see people goofing off on Facebook because they know what they need to do and we really don’t care what happens between point A and point B as long as you get results.
Ascent Advisor: What is HireVue’s vision for the future?
Chip: We are going to be a billion dollar company. We brought David Bradford to our team (HireVue’s CEO) who was last at Fusion-io where he had success taking them public. Right now the HR SaaS space is incredibly frothy with lots of new companies and a lot of acquisition activity among the stalwarts. HR tech is a great place to be right now and grow a company.
Ascent Advisor: What is one challenge you face as a leader you wish employees understood better?
Chip: Our biggest challenge, and benefit, is our virtual workplace. Having people work all over the country makes communication harder. A bit of a frustration point is “corporate.” The challenge for the local leadership is how to make people outside of the main office feel like they are part a connected part of our organization. They get jealous of pie day. They hear about the ad hoc BBQ. The challenge is how to engage the team who can’t hang out on Friday after 5 PM like the rest of the office. That definitely is a big challenge. Keeping them engaged in feeling like they are part of the community. I don’t like the “corporate” vs. “field” that exists at a lot of big companies. We are too small to have a “corporate” vs. “field”! This is why we invest in bringing people to Salt Lake as often as possible.
Ascent Advisor: What is the next hurdle on the horizon for HireVue?
Chip: Effectively managing our growth and our incredible trajectory. When I was a general manager at Acclaim, it was a $400 M company that was roughly the same size as Electronic Arts. We know what happened at EA and we know what happened to Acclaim [filed bankruptcy in 2004]. Acclaim had acquired a bunch of companies and tried to bring them together and grow rapidly and didn’t do that effectively. HireVue is at a transition point. Growing the right way over the next 2-4 years, for all our big company experience and knowing what’s coming, that will be our biggest challenge.