Dave Cain: Welcome to unsuitable on Rea Radio. The award winning financial services and business advisory podcast that challenges your old school business practices and the traditional business soup culture. Our guests are industry professionals and experts who challenge you to think beyond the suit and tie while offering meaningful modern solutions to help enhance our company’s growth. I’m your host, Dave Cain.
The comfort zone. We all have one. Our comfort zone is defined by the things we like, the people we like, the places we go. You get the idea and it’s easy to get stuck. While our comfort zone offers reassurance and stability, that’s about all it’s good for. After all, you’re not challenging yourself to try new things, meet new people, go new places. Trying new professional growth ideas. The unconscious preferences you demonstrate towards those who are similar to is called affinity biased and it’s notorious for holding back individuals and organizations alike.
On today’s episode of unsuitable we’re joined by Michaela McGinn, CPA, principal and director of assurance services with Rea and Associates. As a leader in the firm, Michaela has worked to educate others about affinity bias. On this episode Michaela will dive deeper into the definition of affinity bias by identifying the impact on business. Welcome to unsuitable Michaela.
Michaela McGinn: Thanks for having me Dave.
Dave: Well, this is your first time on the podcast.
Michaela: Yes, I’ve managed to skirt the responsibility.
Dave: Not anymore. Not anymore.
Michaela: I’m looking forward to it.
Dave: You know we always like to start out with a new guest with a couple questions and so let’s go for it. This is, think about this, it’s a no kids weekend. Kids are gone. Just you and your husband. The audience, the listening audience wants to know what kind of dinner are you going to have? Are you going to have the tablecloth dinner with candlelight, flowers, soft music. Are you just going to go out back, light the grill, throw some steaks on the grill, maybe have a Bud Light or two or a fire. Put some logs on the fire pit. Which one are you?
Michaela: Right now, we’d probably go for the latter because it doesn’t happen very often so just being able to have a night with no children that we don’t have to cook for somebody else. You know, something good on the grill, nice bottle of wine. Especially this time of the year if the weather’s good. Go out by the fire pit. Definitely, definitely. Just enjoy the evening. Especially when it’s nice, go look at the stars. That sounds pretty good right now actually.
Dave: All right. It does. Let’s go.
Michaela: I think I need to go call my husband.
Dave: There you go. The no kids thing. You like that.
Michaela: Yes, I like that. A lot.
Dave: You absolutely like that.
Michaela: Although we’re getting to that point where they don’t want to be around us anyways so it’s okay too.
Dave: As true. As true. As are your fellow employees. They don’t want to be around you either.
Michaela: Yes. You know they tell me that often.
Dave: You know, in the introduction we introduced you as the assurance director of Rea and Associates. For our listening audience that’s financial reporting, services, audits, reviews, compilations and I want to ask you kind of an industry wide question. I know you probably see in a years time maybe 400 audits, reviews, financial statements. From the economy standpoint, are you seeing pretty good numbers?
Michaela: You know, it kind of depends on what business we’re in. I think we’re in a very stable period of time. I’m seeing some of my clients actually coming back up. We have clients that are in oil and gas and they might do manufacturing in that fracking area. They’ve struggled the last couple years but we’re seeing that come back up and stabilize. Manufacturing seems very strong. Services are strong. Overall, I think it’s been a pretty good last 12 to 18 months.
Dave: Great. That’s encouraging after a run after the recession of some not so good numbers. It’s good to see everything coming back.
Michaela: Actually, if you compare that back to, oh say 2010 there, it’s very strong. I know that it doesn’t sometimes seem that way because it’s inched along a little bit but it’s been probably more stable and it hasn’t been quite as much up and down.
Dave: Good. Good. You know, we’re targeted to talk about this concept of affinity bias. What is affinity bias? Are you ready to go back to the campfire?
Michaela: You know, it’s interesting, I’ve been in this business for over 30 years. When we started talking about this, there’s things you kind of go, “Oh, yeah, that makes sense.” But in getting prepped for this I actually did a little bit of research. I wanted to make sure I had the right words. And you and I had a couple different conversations and there were a couple of “Ah ha’s” Like, “Oh, I should have known that.” But the reality about affinity bias and Dave you know me pretty well, I can sometimes be a little technical cause that’s kind of my background but I do think using these words will help.
Affinity is a natural likeness and bias means a favor towards so affinity bias is taking your natural likeness and having a favoritism to that in simple words. That means you’re going to go around and you’re going to be around the people you’re comfortable with. You’re going to be around the things that you’re comfortable and you’re going to work within your comfort zone.
Dave: A lot of this, and we want to put it in the concept of the business environment. A lot of it has to do with, and you and I had this conversation, about recruiting, retaining employees and let’s start with recruiting. As you go through, and you’ve done your share of interviews as have I and as you sit there and you interview, you say, “Hum, that person’s a lot like me. I think I’m going to hire that person.” Is that affinity bias?
Michaela: That’s affinity bias in a nutshell. I think part of what happens-
Dave: Well podcast is over. Crack out that bottle of wine. Let’s go.
Michaela: I think what happens is if you think about when you’re out recruiting and you want to hire somebody, the first thing you look towards, even before you start is, “What do I want in this person?” And you might five or ten different things. Think about some of our clients where they put together a job description and a list of things that they want and they’ll say, “Well I want five years of industry experience.” Rarely anymore do you have somebody say, “I want someone outside of my industry,” because they want someone like them. They want someone like their business.
When you’re interviewing, to your point, what you see is, “Oh, I have something in common with them.” I automatically feel a little bit more comfortable with that conversation. You become a little bit more relaxed. Maybe your conversation is a little bit more open then it might otherwise be because you’ve now created that affinity with that person.
Dave: Great. You know I need to back up a little bit. Legal counsel gave me a disclaimer to read before we started this that we needed to disclaim or identify that we are not HR professionals. We’re just two partners in a top 100 CPA firm talking about recruiting and getting the best talent available.
Michaela: That’s absolutely correct. We are not HR experts. What we bring is an understanding of personal experiences and the realities that we are around every day.
Dave: Let’s talk about the halo bias. And by that, if I’m interviewing and I see that, “Oh on this resume this person graduated from Miami of Ohio or Mt. Union. They must be a tremendous talent. Let’s hire them.” Is that another example of affinity bias?
Michaela: Very possibly. I think in that case it may or may not be. I think where you might say it’s not is, “What do you know about the school? What do you know about their business school?” In those cases, there might be some science behind why you’re saying that’s a good thing. In other case it might be, “Oh, hey, I went to school there. They got to be good.” It’s why are you coming up with that conclusion that may lead you to say, “Hey, I have affinity bias or not.”
Dave: And I think we can say with 100% certainty even though we’re not HR professionals that this affinity biased is almost in every business in every industry all sizes and shapes.
Michaela: Absolutely. It’s human nature. It’s what you do with it that makes a difference. One is just being, knowing that it’s out there and being cognizant of what you’ve got going on and then how do you manage it? That’s what’s important to our clients, to businesses out there and to folks that are looking to one, hire, develop and train and retain the best talent.
Dave: What are some of the pitfalls?
Michaela: The pitfalls are that you surround yourself with people like yourself. I’ve often said, we only need one of me. I’m more than enough. We don’t need two.
Dave: You want me to comment on that?
Michaela: No, because we know you’re response. I’ve seen it in the past. We only need one of me. But the reality is, if you only surround yourself by people like you, you give up the opportunity to learn something new, to have people with different ideas, different perspectives, and just different attitudes. You don’t bring them to the table. If you align yourself with people that are just like you then you don’t give everybody equal opportunity to be developed and to advance.
Then, your company is at a disadvantage because if you have a company that does do that, then they have a more well rounded group of people from which to work. Then when you’re going out trying to get new customers, you’re trying to get new clients, well what are they looking at? Because they also have affinity bias. If they’re seeing all the same type of people with all the same kind of attitudes, they’re going to go, “Well, those aren’t necessarily like mine so I think I want to go someplace different.” Those are some of the biggest pitfalls.
Dave: I too think the other side of the coin, the benefits, I don’t see anything wrong with hiring another Michaela McGinn based on your leadership and training and mentoring ability. I think I want all types of those kinds of people on my staff.
Michaela: But you can have great leadership, good training ability and other things and not have someone just like me. You can have someone who has those skills and let’s not confuse great skill sets and great abilities with the affinity part of it. The affinity part of it is getting too comfortable and when you are too comfortable you become complacent. Because what happens is you think, “Well, everybody thinks like I do. Everybody thinks that this is what’s important.” When, it’s really maybe just important maybe to me.
Somebody once said, and this is outside the business context but when you’re raising children there’s probably 10 priorities and everybody has, if you ask them to list them, the same 10 priorities. But the first priority versus the 10th priority is going to vary depending on who it is and how they bring it to the table and what their perspective is. What you really want is great talent that you develop and that are able to bring new and different ideas and not just your ideas. You don’t want people to go, “Oh, yeah, you’re right.” You want people that are going to challenge you and by having and managing affinity bias, you have a greater chance of having that happen.
Dave: Well, I think it also leads to a more balanced team where you have maybe, you don’t run the risk of having all technicians or all sales folks on the team. You have the balance.
Michaela: Absolutely. You need some folks that have great attention to detail. But you also need folks that are able to pull back and have a different perspective. In our specific business we look to who are the great business developers? Who are the great people developers? Who do certain things differently and you want that group in there because that makes a more cohesive, strong group in the long run.
Dave: In your opinion, is affinity biased intentional or unintentional?
Michaela: My personal opinion would be I think it is unintentional but that doesn’t mean that you can’t manage it. Sometimes when things are unintentional they just happen by chance but even things that happen by chance can be managed. I would say an example, again, I live by my children. If you kick the ball in the house, when it goes through the window, I know you didn’t mean for it to go through the window but you probably knew the chances were better than not that it was going to ultimately go through the window because you were kicking the ball in the house. It’s the same kind of thing.
Dave: What’s the penalty today for kicking the ball in the house?
Michaela: Well, if you break that window it can be kind of expensive.
Dave: Loss of driving privileges? Got to clean the house?
Michaela: They’re supposed to do that anyways. It would probably be paying for the new window.
Dave: Oh, that hurts.
Michaela: And they might lose that ball too.
Dave: Talk to me a little bit about trying to understand my own affinity bias or your own affinity bias. Is that possible?
Michaela: Sure. You and I were talking this morning on a personal level about, okay, “What do you enjoy?” Sometimes it might … You could affinity bias on anything. It may be what you do in your recreational time. Hey, you like to play sports. You like music. You enjoy art. If you go and you’re talking to somebody else who likes sports, there’s an affinity. Again, this is human nature. This is about being around people that are comfortable and that’s important because you want a work environment where people are comfortable because if they’re comfortable, there’s a greater chance that they’re going to be successful.
But you also want to have a level playing field and you want to make sure everybody has the opportunity to excel. If you recognize your own affinity bias sometimes you got to work outside of your comfort zone and go, “You know what, I got to go talk to somebody and learn something I know nothing about,” and be comfortable with being uncomfortable in that environment.
Dave: Yeah, I know when you and I were handed this topic both of us were pretty uncomfortable about the topic to say the least but one of the things that encouraged, you and I had a lot of open dialogue and I think that was a positive that came out of this that business owners need to have open dialogue about this issue because it exists, it’s there. You might as well talk about it. You might not be able to find the right words but if you go at it long enough I think you can get a good discussion going.
Michaela: I think you’re right. I think one of the best parts about this is if you recognize that everyone has it. This isn’t a bad thing. This is just part of human nature. You recognize that you’re willing to talk about it and you’re wiling to say, “What are we going to do about it?” There’s nothing better than a lively discussion where everyone feels comfortable throwing their ideas in and recognizing that they’re not going to be shot down because their idea is different. Any time you can have that kind of open dialogue that’s just a recipe for success in any business.
Dave: Let’s talk about some of the impacts, pros and cons of managing the affinity bias.
Michaela: You know, we talked about some of the pitfalls. The pitfalls are doing nothing. The pros are having that diverse group of people. The pros are having better internal and external opportunities. If you have managed your affinity bias then you know that lots of different people are going to have the opportunity to succeed. It also means in the market place you have a greater market because more people are going to be willing to come and say, “Hey, this is something similar to me,” or, “They listen to me. I’m not exactly like them.” Those are many of the prose from this. The cons really just, you’re stuck in complacency and not much opportunity for growth.
Dave: And no matter what industry and what client we talk to, one of their three main things they talk about is the finding talent. If you manage your affinity bias, I think you can do a better job recruiting the talent that you want for your organization.
Michaela: Well, I think that’s where it starts. If you think about it from the interview standpoint the reality is who are you bringing in to interview? And you start with, “What do you need of this person?” And you really, if you start with the technical side of, “Here’s the skill set that I’m looking for.” That is the first place to look. Then, one of the ways to manage that affinity bias that we know exists is make sure that person is talking to lots of different people. People that are going to have different affinities. Then you come back together and you have five different people weighing in on the talent that you have. Then you have a greater chance of creating diversity in your workforce from the very beginning.
Dave: By the way, I noticed today we have a few interviews and we have three, four, five of our team members talking to the recruits.
Michaela: We do, and one of the benefits of doing that, and we doubled up this time and part of that is so, there might be a question you might not think to ask that I do because I come from it one direction and you’re coming from it from a different direction. Now, we get to both hear that question. It’s like, “Oh, I never thought of that.” It really, again it just gives the opportunity to have a broader perspective when you’re bringing recruits in.
Dave: By the way, for the listening audience, we’re recruiting talent. We need an auditor, we need some tax specialists.
Michaela: The reality is, we’re always recruiting good talent. If you want to come work for Rea, we’ve got the kind of place you want to be.
Dave: We can practice the affinity bias.
Michaela: That’s right, we can.
Dave: As we go through the recruiting. Let’s go back to, I think we’ve covered a lot of good points on one, you have to recognize that this exists. A lot of organizations, they can’t do that. I think we see our clients moving in that direction. There’s better recognition of the affinity bias. You get more people involved in the recruiting.
Michaela: Those are two probably the biggest ones. I would agree.
Dave: And once an individual’s aboard, you still have to pay attention to the affinity bias. It’s just not a recruiting tool. It’s an ongoing tool.
Michaela: Absolutely. I think one of the things that we have to remember … Remember, this is going back to your comfort zone. You bring a brand new person in and they have the opportunity to work for different people. It’s like, okay, what do you find that you feel … You just naturally migrate to people that you know or people that have common interests. That’s fine. That’s expected. But what you need to make sure you do is that you’re not excluding somebody because they don’t have the interests that you have.
Dave: Like sports, music, art.
Michaela: When I was starting out, remember I’m in public accounting.
Dave: Shopping.
Michaela: Well, yes. And that’s a very good one to have. Everyone needs a new purse. Well, most of us do. But when I started working, I started listening to the sports page, or I read the sports page every day and I listened to the radio, the sports every day because I worked with men every day. And so therefore, that’s what they talked about. The reality was, if I didn’t want to be sitting in the dark and have no one to talk to I had to change my affinity to what they wanted.
I think that’s the other lesson here Dave is that this is a responsibility for everybody. It’s a responsibility for the people that, this isn’t just the company’s responsibility. It’s the people that work there. If you want to be aware of your own affinity biases at all levels you also have to be willing to be open to what other people do. That’s from a brand new hire, a young person coming out of school, all the way to the owners and in upper management.
Dave: Before we wrap up I do want to go back to that campfire story you opened up with. Would, I know you guys like dinner and a movie. Would the movie be Blazing Saddles that you watched?
Michaela: Unfortunately, no, not right now. Right now it would probably one of the Fast and Furious series. My kids and I, we’ve decided we want to go see the Fate of the Furious and you can’t until you saw one through seven and if you didn’t see it, you’re not allowed to go.
Dave: There you go. We got a movie critic on board as well.
Michaela: I wouldn’t say that but that’s what we’re enjoying right now.
Dave: Well, thanks for joining us unsuitable Michaela. Our guest today has been Michaela McGinn, Director and Principal with Rea and Associates and oversees the financial reporting services, the audits reviews for our clients. Listeners, do you see affinity bias in your own organization? Let us know in the comment section of this podcast or email us at podcast@reacpa.com to tell us what you have done to address the issue. We’d love to share some ideas with you.
Have you ever wanted to see a podcast in action? Now you can. Check out the Rea and Associates channel on YouTube to watch episodes of this podcast and other great videos from Rea. You can also check out our website at reacpa.com/podcast for additional articles and insight. As always, don’t forget to subscribe to unsuitable on iTunes. Until next time, I’m Dave Cain encouraging you to loosen up your tie and think outside the box.