Trust and Referrals

I met a CEO who had hired a new manager. I had referred another candidate to the CEO but that candidate had chosen another offer that was a better fit. She was impressed by the company that she did not choose so she referred a former employee of hers for the job that she had turned down. This person was interviewed and subsequently hired. On Day 2 of the new job, he resigned to accept an offer from a large management consulting company. I do not know the details but can only assume he had been interviewing for both jobs, had accepted the first offer but then was offered the management consulting job, which was his preferred choice.

The repercussions are obvious. The CEO is justifiably upset. He has just spent the past 3 month filling this position and now is back at square one. Beyond that, the resigning employee's resume and reputation is now damaged. The fact that I know this story including the name of the candidate probably also means that many peers of the CEO and the peers of other senior leaders at his company will know the story. In resigning just two days into the job, the employee unconciously broadcast the message that he is "only in it for himself" and can't be trusted to be loyal to any employer. He also demonstrated a level of immaturity in business judgment that makes him unqualified for the roles that he is seeking.  Moreover and more damaging, he just screwed his former boss who referred him. His behavior and lack of judgment clouds his former boss' reputation as an astute judge of talent.

He also places himself in a quandary next time he is looking for a new job. His resume is now toast. If he doesn't put his two day job on his resume, he is opening himself for dismissal from future jobs because of not disclosing it on his resume. If he does put it on his resume, then he probably won't get his next job.

Don't believe me? A few years ago, a large multi-billion dollar tech company hired a new leader to lead their $500+M North America division. The leader had a stellar CV and his hiring was announced with fanfare. Two days before he was to start, he was quietly let go. The reason was that five years earlier, he had landed at a small start-up that was acquired very shortly thereafter by the company that was now hiring him. Following the acquisition, he stayed for a few weeks before leaving. He had not included this brief stop on his resume and when HR was on-boarding him, his social security number revealed that he had once been a company employee (for only a few weeks). The executive team felt trust had been broken. Although it seems like a small thing, it raised the question if this wasn't disclosed, what else wasn't?

Another example that I recently encountered was between two friends. One is a senior executive. The other worked for him for six years in the late '90's. In the mid 2000's, the executive was on a Board of another company and referred the former employee as a candidate for a senior role. Unfortunately, a few years earlier, the candidate had been fired for an expense policy violation from another employer. He had bought a first class ticket for an international flight which was allowed under company policy but then cashed it in and bought economy tickets for him and his spouse.  It was a error in judgment but mistakes happen. What he didn't do was disclose this to his mentor who was referring him at the time of being considered for the new job. The truth came out during reference checks, the former employee did not get the job and the executive was left with egg on his face for referring him. Five years later, the relationship between the two is still damaged.

I am sure there are other sides to each of the stories above. The truth is that I only know one side so my perception is reality and becomes the information on which I base judgments and decisions. Your reputation is who you are. How your reputation is perceived will impact your success. Job referrals and your network are trusted relationships. They are all very fragile and you have to manage them. So be very careful how you deal with situations like the stories above.