How to avoid buying a dud
Avoiding a 'dud' now could be central to whether or not you're judged a success in the future.
How to avoid buying a dud
It strikes me the two industries my business straddles (mining and recruitment) are both well and truly into a “buyer beware” phase. Avoiding a “dud” now could be central to whether you’re judged a success in the future.
Don’t fall into the trap. Today I want to talk about how to avoid buying a dud:
- Mining investment
- Sexy looking piece of recruitment search technology.
In the junior mining space
As capital markets open and money is raised, the pressure to spend it increases.
Back in March 2016 I wrote an article entitled Beware the market miners. I described them as having:
“…serial track records of talking a great talk, sometimes bending the truth, while never explaining the risks.
In many cases they truly believe their own story.
People who invest in these market miners without doing their background checking (which isn’t that hard with our easy access to information today) probably mostly deserve to be fleeced.
With markets at cyclical lows, I predict we will see a few market miners emerge in the next stage of this cycle. As an employee or an investor, beware and consider things like ...”
I also said that:
“If you’re a senior executive looking to join a new flashy company, as I’ve commented previously, you have but one reputation to ruin!
We all need to do our homework — it is not that hard.”
Whether you are a mining company board or investor fielding pitches from savvy sales people, I recommend you carefully consider the points made in that article.
In the recruitment and search space
It seems that every day there is a new platform or piece of software to:
- Enable seamless connections between jobseeker and employer
- Eliminate old-school recruitment fees and shonky recruiters
- Sift through the entire population of planet Earth and find “the perfect person” for your company, with nothing more than a few keystrokes
- And so on. You get the drift.
The particular product or platform aside (and we use more and more of them in our business), I’ve noticed two clear trends in these pitches:
- You are but one “app” away from global domination
- The project manager’s capacity to deliver “seamless integration” of said platform significantly lags their sales ability.
In industries like recruitment and search, being reshaped by technology, or mining where money needs to be spent to find that next big thing, it is easy to feel that you’re getting left behind and to respond by replacing measured risk-taking with punting.
These conditions will attract some people who are principally coming for your money, knowing you have some and preying on your FOMO (fear of missing out).
So what should you do?
I apologise in advance for what will sound like an incredibly dull answer but the only real way to avoid this is to run an old-style research process. Whether it’s a person, a job, a project, or a piece of technology you seek to buy:
- Conduct comprehensive market research to establish the talent pool
- Create a longlist based on an initial screen against your broad criteria (include candidates on the fringes — it is too early in the process to get cute)
- Create a shortlist, based on meetings, products review and references
- Subject every one to the identical full-rinse cycle of the selection machine.
Yes, this will take a bit of time and yes, you will still need to take a risk at the end of the process, but the chances of buying a dud will be significantly reduced.
Whatever you do, don’t get lost in the hopeful haze whipped up by the first person who comes pitching!
Here are some other articles you might be interested in:
How to avoid being caught in a mining scam.
When the big job offer comes should you say yes?
Managing Director & Principal Executive Search
Mining People International