Global Executive Placement Trends….turning away at the altar!

One would think that in a time of tough-ish, tight-ish global markets, where GREAT executive positions with fantastic companies, excellent prospects, and wonderful career challenges are not exactly hanging on trees, that executive candidates would be lining up, desperate to sign on the dotted line when a really GOOD opportunity arises.

Well, think again!

It seems that while high level candidates are as willing as ever to play the dating game, and invest time and energy in the courting process, when it comes to actually taking the plunge and accepting a job offer, execs are  often taking an approach of ‘better the devil you know’, and remaining with their current employer.

WHY is this happening, you ask????

It seems that the impact of the ongoing (it’s been 5 years or so, now) tough-ish, tight-ish global markets is a high level of fear and uncertainty amongst those who have the most to lose by making the wrong career move – senior managers, directors and other C-suite professionals.

And considering that most top players are in senior roles at the time of engaging with a new prospective employer – ie. they have jobs! – when it comes down the wire, they are often either accepting counteroffers, or outright declining a new offer, more frequently than has happened in the relatively recent past.

Interestingly, it became evident at a recent IRC Global Executive Search Partners conference, that this trend is not limited to Canada – it’s global!

More importantly, though, is what we and our corporate clients can do to deal with this trend, and ensure the successful conclusion of top appointments?

The following will go a LONG way to reversing the trend:

  1. Make a GREAT offer – not just a marginal one!
  2. Ensure that the interview process is thorough, but also swift, seamless and faultlessly executed.
  3. Keep ‘selling’ the opportunity – this is not the time to be expecting headhunted candidates to tell you why they so desperately want to work for your company.
  4. Go the extra mile – invest in the process personally, and do not outsource the final stages to administrators alone.

shutterstock_149879492

With these strategies to counter the counter, we’ll win this battle together!

Advertisements

How to Avoid Executive Hiring Mistakes

1776862

Let’s face it – making the wrong appointment at any level is costly and frustrating. But at a senior management or executive level, the wrong person in the wrong job in the wrong company is just….well….VERY wrong!

Which everyone realizes, hence the laborious rounds of interviews, the psychometric assessments, the risk profiling, the reference checking, etc, in order to avoid expensive and potentially destructive mistakes.

The reality is – none of the above is a perfect tool for successful hiring. Of course, we know that both interviewing and reference checking are relatively subjective activities. And psychometric assessments….well, the companies that sell these would have us believe that their assessments can provide scientific answers about potential hires. But let’s think about it – if this was possible, there would never be any issues with under-performance, poor fit or lack of management and leadership skills.

So the bottom line is, there will always be a measure of risk when you take on a new hire. Here are some tips on how to minimise these risks as much as possible.

  1. Accept that there are NO PERFECT PEOPLE

Once you’ve stopped looking for the holy grail, you can manage your expectations. Because one of the biggest risks to a successful appointment is the gap between the wish list and the real thing (a live human being with imperfections that will require a measure of compromise).

  1. Look for patterns in performance, both good and bad

By the time a professional reaches senior management, he has usually had a few jobs in a few companies – so he’s moved about a bit. Which is a good thing, because you can then ask him the golden question – why did you leave? Ask this question for each career move or role change, and you’ll start to see some interesting and insightful patterns. You’ll spot the people who chase money, who leave on good or bad terms with their previous bosses/ companies, who have ‘issues’ or success stories. And when the answers don’t add up, there’s probably something fishy. So keep asking until you’re satisfied. Because the greatest chance of future success is determined by past success.

  1. Let candidates talk

Particularly when you’re not entirely sure. My strategy is to give candidates ‘enough rope…’ so to speak – and then wait for clarity to reveal itself. Which it will, if you have a bit of patience and time.

  1. Don’t be intimidated by great CV’s

I can’t recall the number of times in my very early career when I would be ‘impressed’ by a candidate prior to even entering the interview room. For some reason or another – usually their seniority, the amount of money they made, the prestigious companies they’d worked for, etc. And this would result in me NOT asking all the questions, NOT getting into the substance, and accepting weak or general answers instead of pushing hard for detail and specifics.

  1. Make sure that the appointment will be MUTUALLY beneficial

The key to a successful appointment is when both parties – the employer and the candidate – can see what’s in it for them, respectively. If you start wondering why the candidate is keen on the role (it’s a sideways move at best, the package upside is not going to be all that competitive, the challenges and growth may be limited, the demands of travel are going to be excessive, etc), you should be on the high alert for an appointment that will be short-lived. So the fact that a candidate may be able to ‘hit the ground running’ may not be as brilliant as you think….in the long term.

I hope you get some value out of these tips and that you never make a hiring mistake – ever!

The Benefit of Boutique Firms

IRC 2013IRC Annual Conference 2013 – San Francisco

Simply put, boutique firms offer a competitive advantage to their client companies.  Starting with the breadth of companies from which they can recruit from (based on conflict of interest issues at larger firms) and ending with not having to placate stock holders if they are a public company.  It is my belief that client companies want to make sure that their interests are paramount and not have to worry about search firms trying to serve their own shareholders’ needs to the detriment of the client

I’m delighted to join the Top Gun Ventures team,” said Brian Adamik. “What makes this opportunity most exciting is our ability to capitalize on the fact that the current executive search model is broken. Most of the large search firms today are faced with significant client “off-limits” issues, internal battles over account control, and an over-reliance on their databases of names that deliver the same candidates over and over again. Furthermore, given the number of searches that each consultant handles, large search firms today are simply not able to provide the level of client intimacy necessary to understand customer needs, nor the culture of the organizations they serve. The end result of this is that it takes far too long to fill the role and the placement is not always successful.”

“The Top Gun Ventures model is different,” said Adamik. “We conduct fewer searches at any specific time and we make it our business to understand our client, their culture, and the goals of the position we are recruiting for. We focus on conducting original research on every search we carry out which yields candidates who are top performing executives not actively looking for their next leadership position. Further, we have virtually no off-limits issues; our partners manage all aspects of the search including research, prospect calling, and candidate development; and our precision recruiting techniques allow us to attract the right executive the first time. In fact, we provide a 100% guarantee that our recruited candidate will achieve the strategic goals for which they were hired.”

The executive search industry can be divided into two camps.  On one extreme are a handful of mega-firms, some of them publicly-held, with big brand names and revenues in excess of $500M per year.  These large firms typically cater to Fortune 500 clientele. You may think it sounds prestigious to say “we’re using a big name firm”, but unless you’re a Fortune 500 company, your search can get very expensive, lost in the shuffle, and they will ultimately recruit from you after their hands-off time has expired.

On the other are a multitude of boutiques, most of which specialize by industry and/or function. We believe strongly that most client companies get better results by partnering with the right boutique.  Here’s why:

Is What You See, What You Get?

When you engage a boutique, you are dealing directly with the person who will work on your project.  In contrast, at big search firms, the search may be directed by a “Partner” but in fact a significant amount of the work is done by less tenured associates…people you have never met, and who have minimal knowledge of your company, your business challenges, and your goals. The results? Candidates who match the letter — not the spirit — of the job description; mis-hires who don’t fit your corporate culture; and poor performance down the road.

Access to More Candidates

Executive search firms have an ethical (and usually contractual) obligation not to recruit from clients.  Big search firms have significant off-limits constraints, which limits the pool of candidates while boutiques can access more candidates because they have fewer off-limits companies.   In addition, a little known fact is that candidates that are active on a search within a firm are also off-limits for any other search projects.  Large firms can have literally thousands of active candidates throughout the firm at any one time…all who are unavailable for your search!

Smaller Work Load

A typical search firm partner may conduct 15 to 20 assignments simultaneously, overwhelming their associates and research staff. They operate in a “book ‘em, bill ‘em & forget ‘em” environment. Unless your search is carrying the highest fees or is relatively easy to complete, it may be shunted to the bottom of the heap.  In contrast, boutiques typically work on fewer projects, devoting far more time and attention to each one.

Higher Completion Rates

Boutiques have higher completion rates than big firms.  Completion rates at big search firms are well-known to be in the 60% to 65% range.

In-Depth Knowledge of Your Company

Because boutiques have a business model that enables them to form a genuine partnership with you, they are usually better at selling your opportunity and assessing candidates. Combining its access to talent with its proven Performance Based Assessment SM methodology,

Exactly What is Their Process?

Many search firms operate on a “don’t ask, don’t tell” basis, convincing companies that the search process is mysterious and incomprehensible. The reality is, most big firm partners cannot explain their process, nor do they adhere to a proven methodology.

Big Fish…Small Pond

If your company plans to do more than ten searches a year, you may have enough leverage to get the attention you deserve from the big search firms.  But if your needs for search are more focused, you will get far more personalized and attentive service from a boutique.

In summary

Bigger is not better in executive search.  In fact, big search firms face significant obstacles to client service.  Large scale makes it easier for search firms to build their brands, but does not provide value to clients.

It’s important to remember that search firms are service providers. When evaluating vendors, look past the false allure of name brands and critically evaluate the quality of service you will receive. Determine the firm’s commitment to your company, assess its process yourself whether this search firm is passionate about serving your company’s needs and providing what you and your company want.

How to turn off a headhunted candidate

In the last while I’ve had some interesting feedback from candidates after their first, second, third (or in some cases sixth or seventh) interview with a prospective new employer…..along with a bit of a moan from them about ‘stuff’.

The ‘stuff’ includes such petrifying experiences as being kept waiting in the reception area before being seated in a meeting room – headhunted candidates are usually VERY concerned about confidentiality, as they should be, and it is potentially career limiting to be seen by someone you know in the lobby. Try as you will, there is no mistaking the pre-interview ‘aura’ – any alert person can pick this up – and so paranoia about waiting out in the open is a pretty valid emotion!

shutterstock_122625739Being kept waiting beyond the appointed interview time is one of the biggest pet peeves of headhunted candidates. They are business people that made the effort to be there on time and keeping them waiting sends the signal that your time is more important than theirs. And even more irritating is being blasé about having kept them waiting.

Then, there is the ‘read the CV’ grumble! By the time the headhunted candidate is on to their second or third interview with (usually) various individuals from the executive team, he/she has an expectation that a) they will have read their CV, and b) they will have conferred amongst themselves regarding which questions have been asked and answered so that the same slew of questions and answers are not repeated in each meeting. A pretty reasonable expectation, one would think?

Another little aggravation is the inevitable interview question ‘So why do you want to leave your current company?’. This particular question may seem completely innocuous and without any malicious or negative intent…but if there’s one thing that gets the headhunted candidate’s blood to boil, it’s this one! And assuming that everyone in the room (and on the interviewing panel) knows that the candidate has, in fact, been approached by an executive search firm (yours truly), this would also seem understandably annoying.

So here’s the thing – companies spend LOTS of money, time and effort trying to woo top people to their organisations. They strategise, they plan, they commit the time of their executive team to the interview process, they utilize the services of the best headhunters around to bring the best talent to them. And then ‘stuff’ happens in the interviewing process that turns the candidates from interested to off!

Of course, savvy companies have the interview process so waxed that headhunted candidates can’t wait to sign on the dotted line.

Is the executive bonus system botched?  

The executive bonus has become a somewhat controversial topic in recent years and, in some countries, even the rallying cry for those wanting to apportion blame for the causes of the Global Financial Crisis. Perhaps it is no coincidence that 2007, the year the economy began its decline, was a record year for executive bonuses.

However it is not just the ‘Wall Street investment banker’ who is the recipient of remuneration outside the traditional salary payments. Most executives today receive some form of bonus remuneration as part of their total compensation. Often it includes both a cash payout and a substantial stock award.

shutterstock_149304473The original objective of the bonus system was as a means of incentivizing performance by motivating excellence in terms of employee output. However, increasingly bonuses are associated with motivating other than excellence – the reward itself has become the motivation.

At best many would argue that bonuses seem to be delivered merely for ‘turning up’ rather than for delivering excellence. A great example is the many top executives who were fired for lack of performance that were compensated with enormous golden parachutes, the popular exit “bonus”  for having failed. At worst they can actually incentivize ‘selfish’ behaviour which may be contrary to the long term best interests of the organisation or its stakeholders. Generally designed to reward quarterly performance it actually removes the incentive to perform well in the long term, thereby having a decidedly negative impact on shareholders.

In the hunt for the best and brightest, many organisations have convinced themselves that high bonuses are necessary to attract the best talent, despite the fact that contemporary research does not necessarily support this view.

While we are not advocating the removal of bonuses, indeed this would be extremely difficult given how they appear to have permeated the executive mindset, nevertheless there are a number of ways suggested to improve their effectiveness:

  1. Bonuses are only effective in incentivizing excellence for individuals who have direct control over their own performance – ie: external factors should be limited.
  2. Bonuses should always be discretionary; a culture of automatic bonuses negates their effectiveness. An ‘automatic bonus’ is a camouflaged additional salary or fixed compensation, not an incentive!
  3. Bonuses should be associated with long term collaborative behaviour and thinking – which is much more in the organisation’s interests rather than short term individualism. One way to ensure that is to award bonuses with the stipulation that they be used to purchase company shares. That way the executives interests are better aligned with the shareholders.
  4. The allocation system should be reflective of differences between employees in terms of their performance.  Differences in skills and abilities should be reflected in performance outcomes. If the organisation is not prepared to do this it should not pay bonuses.
  5. A bonus system must be both objective and subjective. It should use an objective criteria to measure outcomes and performance and it should do so on the basis of both short term and long term performance to ensure the future health of the company as well. It should also be a subjective system which looks at how the outcomes were achieved. This will ensure that the way people achieve results will not be ignored, ensuring unethical behaviour is not motivated.
  6. Finally and most importantly, but surprisingly often least recognized, is the importance of the bonus system being clear, transparent and understood by all.