Is retained executive search still relevant?
In the “olden days” of the late 20th century executive search consultants made it their business literally to know people. Before the advent of social networks and in the days when even the internet was limited, companies would use search firms for finding executives that they couldn’t find themselves. It required a pretty thick rolodex to find a long list of 100 suitable candidates.
With the advent of the internet and professional social networks, some companies may ask themselves why pay the huge fees for search consultants when the candidates can be found on the websites of their current employer or on social network. In other words, employers may be asking, what’s the big deal in finding people who are willingly sharing their profiles with the entire world anyway?
Nonetheless the executive search industry continues to grow and according to the AESC’s latest report turns over $14b per annum. Senior level executive search firms must be doing something right, something which clearly demonstrates how they add value.
The phenomenal growth of professional and social networking sites in the past decade has removed much of the mystique that surrounds the executive search industry; 400 million people now choose to share their profile information on LinkedIn, and corporate HR teams are increasingly active in using social media and networking platforms to find people to fill positions that might otherwise have been handed to external recruiters.
And yet, in spite of this, the executive search industry continues to grow and thrive.
I can see that good search firms are adding value at every stage of the executive search process:
- Scoping the requirement
- Identifying the talent
- Assessing the fit
- Closing the deal
Scoping the requirement
Every search consultant knows that “taking the brief” is never as easy at it sounds. At senior level these appointments inevitably involve multiple stakeholders, some of whom may have conflicting priorities. The job of the search consultant is to understand all the different agendas at play and to distil the various messages into an agreed set of key criteria that everyone can buy into. Often it’s only an outsider who can balance potential conflicts that would otherwise make the profile unrealistic. The search firm knows what sort of people are out there and whether or not this role will be attractive. The final brief is likely to be subtly different from the original job profile drawn up by the hiring manager, but at least we know that it’s realistic to find someone who fits the spec.
Identifying the talent
Search is never just a question of finding the names of people who are visible on company websites or on public networking sites. Yes, there are plenty of names out there and people who are actively looking will go to great lengths to make their profile look good. Senior executives, however, have to be very careful about what they share on public platforms. They cannot afford to be seen to be actively looking externally. No-one in a senior role wants to share confidential information about career goals and aspirations with customers, colleagues or board members.
Getting hold of relevant names is down to good market research. Generally speaking, however, the best candidates are those who are not actively looking but who might be persuaded to consider an exceptional opportunity if it happens to fit in with their career plans. Finding these people depends on the search firm nurturing their contacts over many years and knowing exactly when someone might be open to hearing about something new.
Nowadays senior executives can use confidential platforms like Not Actively Looking to keep in touch with selected executive search firms on a more discreet basis. The executives themselves control what information is stored and which firms have access to that information. Crucially, this sort of information is only shared with a select group of trusted search firms chosen by the executive.
Assessing the fit
Search consultants are used to meeting senior people and assessing their fit with a particular style or company culture. The interview normally involves a complex assessment of the individual’s skills, experience, strengths, leadership style and aspirations. Someone who does this for a living every day, might sometimes be better suited to match someone to the very specific needs of the company and that role. The search firm will also take discreet references from others in the industry who will have worked with the target candidate in the past. These aren’t referees supplied by the candidate, these are people we know and have maintained a relationship with over many years.
The assessment, however, goes both ways. The senior executive may look at a number of roles. He or she will want to know that the specific role in question is one that they can perform well in, that the company culture will suit their style, and that the people they will be working with are complimentary in terms of working style and behaviours. Over time they will come to trust the judgement of a particular individual or search firm and will rely on that judgement to help them make the right decision.
Closing the deal
The final stage of the search process is one where there is potential for misunderstanding, misconceptions and mistakes. What package is the candidate hoping for? What package does he or she realistically expect? What might they be prepared to settle for? And what are the trade-offs that he or she might be willing to consider? All of these are critical questions that are taken into account when negotiating the salary package for the chosen candidate. At the same time, the consultant also has to keep other candidates in the frame in case negotiations with the first candidate break down.
That is vital. If the search consultants have done their homework, they will know exactly what the candidate’s expectations are, both financial and non-financial. Generally the financial considerations are secondary. Mostly it’s about understanding what stage someone is at in their career and knowing which opportunities will allow the candidate to fulfil his or her true potential. That’s where the outsider can be more effective than anyone internal in selling the potential of the role and the company.
Hiring the right person is a critical and highly complex business. It’s the sort of decision that will determine whether or not companies [or CEOs!] achieve their objectives. Yes, a lot of people can be found on the internet, but that’s clearly not enough. Executive search consultants continue to demonstrate their added value every day by helping companies to find, select and secure the right talent in key roles, and that’s why companies continue to rely on trusted executive search partners to help them get it right.
By Anthony Harling, co-founder, NotActivelyLooking.