Kula Consulting Blog

Last week’s posting ended with this question: “What does a poorly run financial institution have to do to get a qualified opinion from its auditors?”  Evidently I’m not the only person asking this question.A small army of lawyers is asking or planning to ask Big 4 bigwigs the same question - in court.  In fact there is speculation (see: http://www.accountingweb.com/cgi-bin/item.cgi?id=106124) that the Big 4 may not survive massive lawsuits that are either pending or will soon be filed concerning the collapse of many of our financial giants.

According to the U.S. Treasury’s Advisory Committee of the Auditing Profession, the Big 4, between them, have 27 outstanding litigation proceedings with damage exposure above $1 billion. Seven of these lawsuits exceed $10 billion!

These figures were compiled prior to September’s meltdown of our financial system. Think about this:  E&Y audited Lehman Brothers; PWC audited AIG AND Northern Rock. KPMG audited Fannie Mae. Lawsuits anyone?

Back in the dark ages when I was a Big 8 auditor, my firm, Ernst & Ernst (AC and DC), stressed the position of trust and independence we held in the financial community.  I know I took my audit responsibilities quite seriously, and always felt that we represented the shareholders of the companies we audited, not the management team.

It was our firm’s duty to let the board know about control weaknesses, inefficient operations and areas that could be improved. We presented “Management Letters” to the board, as well as providing an opinion on the financials.

When I was an internal audit director for a publicly traded firm, I believed I still worked for the shareholders and not the CFO.  My boss felt otherwise, so that job didn’t work out very well!  Of course he was known at the time as “Chef J___,” and I should have known better.  That company was later snapped up at a bargain price (sorry shareholders) because of how it was “managed,” but none of the executive team suffered because of their behavior. The external audit was a joke.

Evidently many of the Big 4 have been performing “joke” audits on Wall Street. We will find out if the same holds true for Main Street soon enough.  I’m predicting a boom time from litigation-support accounting services for the next 10 years.  I have no prediction regarding the viability of the Big 4 or the for profit business of auditing public companies.

I promise to not publish on Kula’s website any further rants about the non-performance of the Big 4 during the past nine years. I promise to only publish career-related articles from now on!  But, here’s some career advice for those planning to become Big 4 partners:  Don’t take on any liability. Ask to be promoted to Principal and receive substantial big cash bonuses. Becoming a partner is just too risky.

Does anyone remember the old banking maxim: “If you owe the bank a little bit, the bank owns you — but, if you owe the bank a lot, you own the bank?”

Looks like this is a truism, because “We the People” now own the banks, and the insurance companies, and the investment banks, too. What a week! Up until a few days ago, we thought the $85 billion bail-out of AIG was news.

Now the US taxpayer is the investor of last resort for ALL bad loans in America (the world?). Plus, I love the serious deliberation and fact checking and Congressional hearings that dig deep into the reasons for our alleged imminent financial collapse. Not! (As my kids used to say.)

I’m stunned that we had less than two weeks to come up with a solution to a financial mess that, we were told by our government up until September 14th, was under control.

Don’t panic, and the market will work things out… Either our government is clueless or deliberately deceiving the public. Plus, did you know that we are still not in the middle of a recession? Unemployment in California is currently 7.7%; we have a 50-year inventory or homes for sale, stock market values are down 20% from a year ago and, it seems, only Google and Oracle are making money.

But, we are not yet in a recession. Seems to me the $700 billion bail-out is short about $1 trillion, or two.

Why don’t we ever see the bubbles coming? We have had housing booms, stock market booms and Ponzi scheme booms many times in the past, but don’t seem to learn from them.

I remember most of these booms and the resulting busts very well. During the Dot Com days, many recruiters took stock in lieu of cash for placement fees (my old firm made a million bucks on one deal that way), and there were 1000 CFO openings in the Valley in the late 1990s.

I vividly recall meeting with a new Internet start-up CEO (20 years old with blue hair), who told me he needed a CFO who would be able to find a good office lease in a building that was “dog friendly,” and help him move the company out of his Mom’s garage.

He had raised $20 million for some crazy idea, but it was an Internet idea. The money was gone in a year and so was the blue hair. Not that there is anything wrong with blue hair. My mother has blue hair, and it’s very attractive.

I bought a rental house in mid-2003 in Santa Cruz to rent to a family member. When I applied for a mortgage on the property, I didn’t have to present any financial information, not even a tax return or a bank statement to get the loan. Two years later I put the home on the market and received five offers the first day on the listing. We had three subsequent increased offers. I couldn’t believe the price being offered for a 1300 square foot house with disclosed things that needed fixing. I felt bad, but took the highest offer — for a 67% gain on the purchase price in two years. The buyer put zero cash down! Insane! But, that may be what has happened in every segment of our financial system.

No rules, no oversight, and insanity. What were we thinking, and are we thinking yet?

As I write this the final deal on the $700 billion bail out of our financial institutions has not been completed or announced. Therefore I don’t know if it’s a good deal for the USA or not. I don’t even know if we need to do anything. It’s very hard to trust that our government even knows what the real problems are, let alone that it might actually know how to solve them.

I do know that I’m very upset that everything our government does is in a crisis mode. I try not to run my small business that way, and don’t know any of my clients that run their businesses that way. Don’t even get me started on how the State of California is run!

My question to anyone who actually reads this rant is: Shouldn’t the accounting profession be taking a share of the blame for the lack of real transparency and usefulness of financial information? At least in the reporting and accounting of banks and other financial institutions? What does a poorly run financial institution need to do to get a qualified opinion from its auditors?

Let me know what YOU think!

 Hello, is anybody there?  Is this mic on?  Is the end of the financial world as we know it just a few days away?

 

As I read the financial news, listen to talk radio and play phone tag with my broker it certainly feels like apocalypse now. It’s like this: I bank at WaMu, Morgan Stanley is my broker, and I have no idea who (or what country they live in) really holds the mortgage on my home. Thank goodness I’m not in arrears or default!.  And don’t even talk about my rapidly dwindling retirement accounts!

 

In an effort to keep from “taking a long walk on a short pier,” I have done a little research on the US economy to try and gain a little perspective on where we are today and where we have been.

 

Stock Market Not as Volatile as it Appears

 

First let’s look at the DOW. The DOW closed today (9-18-08) at 11,020 - up about 400 points from yesterday.  A year ago the number was 14,080, resulting in a 21% decline in a year.  When compared to January 2, 2001, the DOW has increased 1140 points from the 9880 number about eight years ago.  Even two years ago the DOW was only 520 points higher than today’s close.  Not a jump-off-the-bridge type of loss.

 

The NASDAQ performance is even more interesting to me than the DOW. At the start of 2000, the NASDAQ index was 2059. It closed today at 2199 - a slight plus or push at worst.  But a year ago the index stood at 2670 or 471 points higher than today.  Short-term down, but long term up a little.

 

Perhaps the old investing advice of diversify and hold for the long term is still pretty good advice. Someday I’ll take it.  Better yet, buying in a down market is also good advice. Just take heed of these two caveats:  1. You have any loose cash sitting around; 2.  You are able to recognize a down market from a crashing market.  It’s a good thing we can still buy coffee in a tin can. The cans come in handy as a place to stash cash when your bank goes under!

 

USA GDP, National Debt Not so Great

 

The US national debt as of today is roughly $9.65 trillion.  The 2008 domestic GDP  stood at around $14.3 trillion. So our debt to GDP ratio is about 67% of GDP.  On that basis the country is way better off than I am.  My total debt would be way over 300% of my gross annual production (income). Keep in mind that I’m doing fairly well compared to the average person.

 

But, still, we owe 67% of GDP?  That cannot be a good thing. Plus, our off-balance sheet debt (contingent liabilities) must be huge as well after the recent Wall Street bail-outs, my generation retiring and unfunded cost of two wars.  Note to self:  The FDIC only has around $45 billion on hand to “insure” our bank deposits, or about 50% of the amount “invested” in AIG this week.  Mommy, I’m scared.

 

But, let’s finish the numbers.  Got to have a chart. Oh, here it is:

 

Date            Debt                  GDP             Debt/GDP (%)

 

2008          $9.65 trillion    $14.3 trillion        67%

2000          $5.66 trillion    $9.95 trillion        57%              (I like writing “trillion”.)

1992          $4.17 trillion     $6.2 trillion         67%

 

The ratio of debt to GDP is the same now as it was sixteen years ago, but the total debt has been growing at an annual rate of 6.7% from the total at the end of 2000.  GDP has grown at a 4.5% rate from the 2000 number.  It seems to me that it would be better if those growth rates were reversed.  I would rather see GDP grow at 6.7% and debt at 4.5%.  Could be a good goal to shoot for.

 

One more thing:  The US GDP is about 25% of the world’s GDP.  Pretty much the same percentage as at the end of 2000.  It looks like we are maintaining our position in the world, but are not pulling away from the competition.  (See China Olympic Opening Ceremony!)

 

What’s This All Mean to Accountants?

 

I don’t know about you but, by taking this look back on the financial and economic past,

I am feeling less anxious about our current situation.  We will get through it.  But, I am concerned about the “unknown unknowns” in the financial markets.  In particular I’m concerned about the role of the accounting profession in the financial reporting area.

 

Over the past eight years we have seen significant changes in financial reporting, internal controls and public accounting independence regulations.  We lost a great firm - Arthur Andersen - because of the Enron fraud. Further, the country has spent billions implementing and updating controls per SOX legislation.

 

We were supposed to get better financial reporting and lessen the opportunities for abuse as a result of those changes.  But look at AIG, WaMu and Morgan Stanley’s recent financial statements. Would you have seen major issues in them that would lead you to believe these firms were in deep financial trouble?  I’ve looked at their financials and the red flags were not visible.  If they are in deep trouble, why aren’t their major issues transparently obvious to the average reader of financial statements?

 

Has the accounting profession been focused on the wrong “bright, shiny objects”?  Why didn’t the accounting standards and reporting requirements uncover the red flags that used to lead to a going concern, qualified opinion? 

 

I don’t know the answer, I’m just a recruiter (and a CPA), but someone in the profession should be trying to find out why this crisis didn’t show up early in the financials of these firms.  Maybe we should be focusing our accounting research efforts of making the audit and financial reporting more useful to investors and shareholders rather than merging GAAP with the international standards. 

 

What are your thoughts on this? Inquiring minds want to know.

 

This is yours truly on a trip to France we took in 2005.
My friend, Monsieur Doggie, did not enjoy
a sip of wine - but he devoured pate like Alpo.

Talk about a moving target…I went by Costco last week about 10 a.m. - a gallon of gas was about $4.38. Shortly after lunch, I drove by that same station and gas had jumped up to $4.45 per gallon!

The unthinkable is just around the proverbial corner: $5 a gallon. Would you believe the possibility of $6 a gallon this time next year? Its really not that far-fetched.
Never have so many people attempted to collectively solve a problem. It seems like every one has an answer about why gas is driving inflation: commodity futures, weak dollar, and gouging by big oil companies, to name a few.

Meanwhile, the masses gripe and pump, pump and gripe, and bitch, bitch, bitch, life goes on - with the price of gas doubling during the past year.

Short of abandoning your SUV in an airport parking lot and running for your life, here’s a few common-sense actions that you can take to lighten your heavy-duty gasoline load.

1. Purchase a Prius or motorcycle. Indeed, these two modes of transportation drastically reduce your gas cost per mile by about half. Regular cars use between 20-25 cents of gas a mile to operate. A Prius or motorcycle reduces that cost to about 10-12 cents a mile.
2. Another option is to reduce the distance of your commute. The obvious way (and the biggest hassle) is to relocate closer to work. Keep in mind, however, that no job lasts forever, and you don’t want to live someplace you hate only to lose your job six months after moving.
3. Car pooling is also an excellent way to roll (especially if you’re car pooling in a Prius). The idea of being on other peoples’ schedules may take some gettig used to, but the short-term adjustment is well worth it.

Long term, if you took action to either reduce your commute, or switch to a higher MPG mode of transportation, you could put your gas savings into a 401k plan and have an extra $100,000 in your account by 2028.
At the end of the day, we love our cars. Until we get over this love affair we are all at the mercy of whatever is causing this problem. Your options are limited, but they do exist. I suggest you take a few minutes to write down on a piece of paper how long your commute is, what kind of mileage you get, and who in your office lives near you.

Armed with facts, you can then make a decision - send your kid to college of fill up your tank:-)

Rich

Earlier this month I posted a blog about the globalization of accounting and reporting standards, and how those proposed changes could adversely impact American accountants’ careers.  I have a vested interest in this subject: as an owner of an accounting staffing firm, the future of the profession has an enormous impact on my business.

Since my post I checked in with several CFO’s on this subject and asked for their take on the changes.  I could best describe the CFO’s as being extremely wary. Why, they asked, was there such a rush to make major changes in the accounting profession?

It seems all the rule making and regulatory groups are getting into the act:

- The SEC last fall announced that foreign registrants can use international accounting and reporting standards when they file reports.

- The FASB has a major project underway (since 2001 apparently) to start reconciling international standards with US GAAP.   A fundamental issue will be reconciling the “rules based” and “principals based” approaches to determining accounting standards.

The FASB and the international accounting standards people are working on a joint-project to fundamentally change financial statements.  Will we see the end to Net Income as a line item on
the P&L?

Oh, also throw in the “plain language” initiative before congress and this matter becomes even more interesting.

So, who is pushing for these fundamental changes?

It doesn’t appear to be American CFO’s.  The polls I’ve seen state that CFO’s question the proposed speed and need for many of the initiatives being put forward by the SEC, FASB and the international financial standards people.

Ok, if the CFO’s aren’t asking for these changes, I sincerely doubt that board members or CEO’s are behind the changes. Rank and file shareholders are not likely advocates - they rarely read the financial statements that companies send them now.

The big international CPA firms will certainly benefit from all the changes.  Think of all those fees (whoops, forgot about the law firms) they will collect from training and advising clients.  I would put them close to the top of the list of groups benefiting from these changes.

The best guess for this momentum for change (no – not Obama!) is Wall Street and the SEC.  Stock exchanges are starting to merge and would benefit from uniform, global accounting and reporting standards.  Stock analysts would also benefit from global standards and, perhaps, from new financial statement presentations.  The SEC is pushing for registrants to file reports using the XBLR format with the goal of building a uniform, searchable financial database on the Web.   If all financial reports used the same accounting standards and reporting formats, this database would be a very powerful tool for investors and analysts.

Perhaps having a unified, global set of accounting and reporting standards is a good thing.  But, when accounting knowledge becomes a commodity skill set as have C++ programming skills, will the offshoring/outsourcing of senior-level accounting jobs be the unintended consequence of globalization?

How to Stay Informed on this Issue

In keeping with Kula’s ongoing effort to keep our colleagues up on the accounting field’s latest trends and issues, we’re developing a seminar during which time experts will provide an overview of the major changes taking place in international accounting – including a few that are still “in committee.”

After hearing from our panel composed of representatives from FASB, securities, public accounting and law, you will walk away with an accurate analysis of how these changes will impact you, and what will be required as you account for and report financial information in the near future.

I’ll be sending out invitations as soon as we solidify the exact date. In the meantime, I am including a few links to more detailed information about the initiatives.

From CFO magazine:  http://www.cfo.com/article.cfm/10597001/c_10598910 
To the SEC’s XBLR analysis tool:    http://www.cfo.com/article.cfm/10597001/c_10598910
From Financial Week:  http://www.FinancialWeek.com/apps/pbcs.dll/article?AID=2008492320813

From a blog by PWC:  http://pwc.blogs.com/ifrs/2008/02/improvements-in.html

Another SEC item:  http://www.sec.gov/about/offices/oca/acifr/acifr-ddm-011108.pdf

Please let me know your thoughts about the future of the accounting profession, especially those regarding the impact on the American accounting workforce.

Best,
Rich

I hate to be an alarmist, but did anyone notice that the SEC agreed to let foreign companies file their reports under International Accounting Standards?

Plus, three years from now, US companies will be able to elect to file using international instead of US GAAP.  What happened, why and what could it mean to us accounting-types?

I’m just a poor ole country recruiter, but whenever the “govment” makes a major change I’ve found that it isn’t always a good thing for the governed.  I have started to call some folks I know (that’s what recruiters do), and do some reading to try and find some answers.

Here’s what I’ve learned so far:

Foreign companies should save $3+ billion by not having to conform to GAAP. The savings would come from lower accounting and legal expenses.

The FASB would become a non-entity over time.  If the goal is to have one global set of accounting and financial reporting standards, then the FASB would give way to IFRS.

Most accounting professionals will need to be re-trained.  Understanding international accounting standards will become a significantly valuable skill-set for future employment.

My big question is: Will exempt-level accounting and finance jobs be outsourced?  Will we see a similar scenario within accounting as we saw in software development outsourcing?

The SEC will allow US companies to file reports under international accounting standards within three years.  Since the international standards are “principals-based” versus “rules-based” standards, will we see a return to more creative accounting treatments?  Will lawsuits over accounting treatment issues increase?

And finally, when accounting standards become global will the financial auditing firms (Big 4) face significant competition from offshore accounting firms?  And, if so, what will be the impact on the accounting profession and job market?

I think we are all in for some profound changes in our work lives due to these changes.  Some will be perceived as opportunities and some will be challenges, but, we all will be impacted by this change.

Here are a few links to additional information about this subject, if you are interested in learning more:
1.  The SEC & IFRS:  http://www.cfo.com/article.cfm/10159708/c_3395216
2.  The Dark Side of IFRS & GAAP:  http://www.cfo.com/article.cfm/10131891/2/c_3395216?f=insidecfo

What do you all think?

Oh, and stay tuned for our upcoming teleseminar on this very subject!

Rich

A friend of mine called me complaining about the rapid rate of turnover at his mid-sized accounting firm.

He swore he was doing everything right: he paid great salaries and hired only the best and brightest “star” CPAs. Yet still, he was constantly having to fill positions.

First off, I told him, it’s true that the Bay Area has an above-average employee turnover rate. The US average annual rate is 30 percent and the Bay Area is 40 percent, according to Kula’s recent CPA Salary/Satisfaction survey.

At wit’s end, my friend asked if there was anything he could do to hedge this trend.

Well, I said, first off, there will always be accountants coming and going. There’s no way to stop that. Someone will always offer more money or increased benefits. And then there are the less-quantifiable departure reasons such as, perceived lack of advancement opportunities, better training or career development, and personality issues.

The good news is that employers can take strategic steps that will turn them into the kind of employer that people want to work for.

I said let’s break down the turnover issue into two parts:
1. The turnover of “fast-track” employees.
2. The turnover of people who work in order to live, the “normal-track” employees.

Fast-track performers are overly competitive and career oriented. They will stay with an employer for only as long as they are challenged by the work, learn and acquire skills that will help them achieve career progression goals, and progress at a faster rate than their peer-group. When any one of these motivators starts to lag behind expectations, these fast-track employees will move to a new opportunity.

Normal-track performers, generally, are more interested in work/life balance. They want good compensation, a flexible workplace and good benefits, and interesting work. If those items are available at another company, and the commute is shorter, or they offer a company gym or a nicer facility, or a friend works there, it is almost certain they will change jobs. Please take note that I have not listed higher compensation as the primary motivator for making a career change. I agree that it is a factor, but it is rarely the primary factor for making a change.

Now, given these two broad types of employees, I believe turnover may be reduced through a combination of actions that do not require spending lots of money.

Becoming a great employer

My No. 1 rule for reducing turnover is don’t hire a fast-tracker for a normal-tracker position. In other words do not hire a hot-shot for a position that can be learned quickly and offers minimal career advancement opportunity.

Break down the organization chart into two categories (you guessed it): fast-track and every other position. Fast-trackers need to be in visible positions, have people to compete against, be challenged, and get promoted or rotated quickly and often to be happy. If a position doesn’t have all of these attributes then don’t classify it as a fast-track job.

Once the organization chart has been reclassified, seek job applicants that match these profiles as well as match the position description. Hire people who will be happy and challenged by the job and anticipated career path for at least the next five years. Five years per employer over a thirty year career is 20% turnover–a significant improvement over the average.

Anything else, my friend asked?

You bet - all employees want to work for a great employer. A great employer:
1. Listens to employees.
2. Seeks their input and values what they say.
3. Uses their employees’ ideas and suggestions and acknowledges their contributions to the success of the company.
4. Makes sure that employees have the right resources to do their jobs and equipment that actually works.
5. Implements career development programs that help all employees reach their full potential.
6. Places a high value on the employees’ time. This means providing flexible work schedules, tele-work arrangements and job sharing opportunities for all positions.
7. Establishes a real open door policy and promotes an open and supportive communications program.
8. Sets reasonable goals and expectations and reward attainment.
9. Creates a safe, comfortable and pleasing work environment that is free from harassment, threats or demeaning behavior.

Becoming a great employer does not require a lot of money, but it does take hard work and commitment. Becoming a great employer will help reduce turnover and will also build a reputation as a great place to work. This reputation will help a company fill open job opportunities quickly, which reduces the costs associated with turnover. The other action that can be taken to reduce turnover is to make the right hire in the first place.

Oh, and one more  thing…

Other time-tested ways to reduce turnover are to outsource the functions that have the highest turnover rates and use contract and temporary employees to smooth out the peak workload periods and thereby maintain the work/life balance that is important to most of a company’s employees.

Well, my friend asked…so I answered.

As most of you have probably noted by now, our recent salary/job satisfaction survey yielded some interesting results. If you haven’t read it already, download a copy at www.kulaconsulting.com.

Conducted last November, the survey polled accounting professionals in public accounting and in the private sector. This was our first salary survey and, I believe that it contains useful information for employees and employers.

Of interest is the significant percentage of accounting professionals planning to seek new employment in 2008 - despite the high level of job satisfaction.

The facts paint a realistic picture of Bay Area accountants

Check out these trends we found in the survey:

In public accounting firms:

- 98% like the content of their job

- 41% are not happy with their work/life balance

- 25% are not happy with their compensation

- 28% plan to make a job change in 2008, with another 6% planning a leave of absence or a return to school

It appears that the content of the job must be out-weighing the distress about a balance between work and “life,” or a greater percentage would be seeking to leave public accounting.

In the private sector:

- 90% like the content of their job

- 90% are happy with their work/life balance

- 21% are unhappy with their commute

- 20% are unhappy with advancement opportunities

- 14% are not happy with their compensation

- 43% plan to seek new employment in 2008

Based on their survey responses, accounting professionals in both public and industry like the content of their jobs. To me, this means that accounting professionals made the correct choice by majoring in accounting. Accounting work is challenging, rewarding and offers accountants a high degree of satisfaction. When combined with good compensation levels, the accounting profession should be attracting a higher number of accounting students than it does. We need better PR!!

The survey confirms many of the issues we hear during our interviews. CPAs in public accounting travel a lot, work long hours (busy season seems to be all year long), feel stressed, and could make more money in corporate accounting. But many of them thrive on the competition to “make partner,” feel part of an elite team, and enjoy the work they do.

Sometimes working long hours is perceived as a badge of honor for being able to do it. The shortage of new CPAs (evidenced by the almost flat number of new CPAs over the past 15 years) and the increasing demand for public accounting firm services, points to a continuation of the job satisfaction trends we found in this survey.

I don’t think we know why there are such a high percentage of private sector professionals planning to change jobs this year. Turnover is a very expensive and disruptive force in any part of business. I live in a very high-turnover profession - new recruiters have a 50+% turnover rate - so I understand the impact on the bottom line.

My next blog will deal with one reason for turnover and my “solution” for it. Meanwhile, I’m going to do more research into why 43% of our industry respondents plan to make a job change, when 90% of them like their job and work/life balance. I’ll write more when I have more information for you.

Don’t forget: Kula has lots of jobs for those looking for a new one!

Finding a job is a job in and of itself. Know that going in, and having realistic expectations removes a layer of stress and uncertainty from the process.

Before going further, I suggest that you read (or re-read) my last posting about whether changing jobs is the right move for you. That post offers a quick overview of what it takes to conduct an effective job search.

Here are the 6 steps to following your career path:

1. Time Commitment

It takes a lot of your time to do a job search. Tasks include, preparing at least two versions of your resume, composing strategic cover letters, writing thank you cards, interviewing, researching, giving and receiving feedback, and staying in touch with potential references and networking contacts.

2. Thick Skin

Prospective employers will all ask you the same or similar questions about your work history. They will probe why you made certain choices in your career, test your technical knowledge, and challenge you to show why you are right for them.

Human resources will ask you to fill out application forms, perhaps take some tests, agree to a background check and want to call your references. Plus, just when you think you’re done, they may ask you to come in for “just one more” interview. The interview process can be stressful. Keep in mind that you are still doing your current job and attending to personal matters. Lots of patience and a “thick skin” are the keys.

3. Be Prepared

You need to have a personal presentation ready to go. Prepare a 30-second “elevator pitch” about your background and work history. Find a peer or family member and practice your presentatino until it’s second nature to you. Why? Because more than half of all  hiring decisions are based on the interviewer’s first impression of a candidate.

You also need to be prepared to make concise, but complete, answers to questions about your skill sets, work ethic, management style, and accomplishments.  You need to bone up on the company your are interviewing for so you can demonstrate how your background fits with their needs.

You also need to be prepared to answer the “what’s  your weakness” question. In other words, tell the prospective employer about an area of your background that you want to improve, and you think you can do that by working with your company. Don’t say, “I work too hard” or “I don’t toot my own horn enough.” Remember the song by Mac Davis called “It’s Hard to be Humble When Your Perfect in Every Way? Don’t be the person in that song!

4. Network

Contact your business contacts and let them know what you’re doing. Ask them for advice and referrals to opportunities they know about that meet your search criteria. The majority of people get their next job from networking with former managers, colleagues, lawyers, or CPAs they know, or from friends and family members that know someone.

5. Outsource Some Work

Work with a couple of recruiters who specialize in your field (like Kula, wink-wink). Recruiters have access to opportunities that are not advertised, have knowledge about most companies, hiringmanagers, work environments and current compensation and job market information. A good recruitier will help you find opportunities that fit your criteria and will help you with ever step in the job change process - for free!

6. Stay True to Yourself

You decided to make a job change because there are issues that cannot be resolved by your current employer. You have determined where you want to be in three years and have developed a plan to get there. Stick to your plan when evaluating a job offer. It’s hared work making a job change, so only accept the offer that meets  your criteria and moves you closer to your three-year goal.