Gary Vaynerchuk to CFOs: Caring About People is Financially Viable
The brash entrepreneur didn’t hold back his frustration with most chief financial officers during his keynote presentation at HR Tech World in San Francisco this week. Managing Editor Frank Kalman reacts to this and more from his visit to the conference.
I spent much of the week of June 12-16 attending HR Tech World in San Francisco. Located at the Fort Mason Center for Arts & Culture, a former U.S. Army post overlooking the Golden Gate Bridge, the conference featured a who’s who of folks in the HR and talent technology space, as well as a few high-profile keynote speakers.
Even though the conference was centered around the technologies that are changing the way organizations recruit, retain, train and manage their workforces, the most important things I learned from my time there had little or nothing to do with technology.
Gary Vaynerchuk Ripping CFOs
My favorite lessons from the conference came from the event’s first-day keynote speaker Gary Vaynerchuk.
I imagine most people in business have become very familiar with Vaynerchuk in recent years, but for those who aren’t, here’s a quick bio. Vaynerchuk is a serial entrepreneur who started out by turning his father’s traditional wine store business into a $60 million e-commerce enterprise. Since then he’s become one of the most recognized names on social media, with 1.4 million Twitter followers, 1.7 million Instagram followers and 2 million Facebook fans. He’s turned his social media and digital marketing savvy into VaynerMedia, a company that he said is on track to earn close to $150 million in revenue this year. On top of all of that, Vaynerchuk has established a powerful personal brand for himself that’s led to a few books and a prolific speaking career.
I encourage you to check out Vaynerchuk’s content, especially his videos of talks he’s given at previous events. On Tuesday, Vaynerchuk’s talk touched on many topics, mostly around the importance of building businesses that are centered around people — and not in the clichéd sense.
At VaynerMedia, Vaynerchuk’s top talent executive is his second-in-command and is uniquely named the company’s chief heart officer. This is significant not just because it shows that Vaynerchuk isn’t just paying lip service to an HR and talent crowd but is the real deal when he says people are more important than anything else in business. It’s also significant because it means that, at VaynerMedia, the top people and talent executive is above the company’s chief financial officer, which for many companies is typically the No. 2 executive role.
In fact, Vaynerchuk didn’t pull any punches when speaking about his frustrations with many traditional CFOs. In what seemed at first like an unstructured curse-filled rant but ultimately settled in as a brilliant take down on the backward nature of traditional CFO-centric corporate thinking, Vaynerchuk ripped top finance chiefs for being too short term and overly focused on people as a cost center, as the crowd filled with talent practitioners and technologists applauded with enthusiasm. He said that CFOs’ obsession with boxing expenses in a 90-day window often clouded their thinking for the worse, especially when it comes to decisions on people.
Put simply, Vaynerchuk’s point was this: Investing in and caring about people and culture is financially viable, but CFOs are too stuck in their neatly organized spreadsheets to see the forest through the trees.
One example he offered involved the importance of getting to know employees’ interests by following their activity on social media. One time Vaynerchuk noticed that one of his well-performing employees was a fan of the St. Louis Cardinals baseball team. So Vaynerchuk decided to show his appreciation by flying him out to St. Louis and paying for his tickets to a Cardinals game. Most CFOs would find this act and its related expense wasteful; but, according to Vaynerchuk, the roughly $700 he spent on the flight and tickets likely saved the company thousands and thousands of dollars in long-term raises for that employee.
Sometimes, the short-term costs of going above and beyond to take care of a company’s best people will be painful, but in most cases these types of expenses will pay off mightily in the long run. Unfortunately, many of today’s CFOs are too blind to see this, Vaynerchuk said. To them, money spend on people is money out the door; to Vaynerchuk and others who recognize the importance that caring about people brings to business, it is an investment with compounding future returns.
The problem that too many talent executives face is they try and convince their CFOs otherwise by making a blanket argument that this is “the right thing to do.” But, as Vaynerchuk put it, the only way to get through to most CFOs on this front is to put each pro-people decision in dollars and cents. You need to be able to showcase the math to be able to show them what they’re overlooking.
I could not agree more with Vaynerchuk on this. As someone who used to cover finance and commercial real estate before moving into the talent space, I can definitely confirm the notion that executives from finance and accounting can sometimes be penny smart and dollar stupid in their management style, especially when it comes to people and talent management practices. The problem with this type of management style is that finance chiefs aren’t good at seeing the cost-benefit of retaining people; they only see payroll and tax liability on the balance sheet.
Other Odds and Ends
There were some other notable lessons I took away from my time at HR Tech World. One of them that I’ll leave you with here is that, even as technology is seemingly taking over the world — and in the process sucking the human element out of everything — the most important skills in the future of work will likely involve much more of the human element.
Again it was Vaynerchuk who made this point stand out when he said in a private question-and-answer session with the media after his talk that empathy is the most important skill in business today. Being able to empathize with others and lead with other soft skills will be paramount in a world where most of the technical stuff is being taken over by technology. The exposition floor at HR Tech World was filled with software and platforms designed to revolutionize the way we manage talent, but most of it is irrelevant if leaders aren’t able to supplement technology with the human element.
Frank Kalman is Talent Economy’s managing editor. To comment, email firstname.lastname@example.org.