Executive Search

Executive Search recruiters represent companies, not candidates. It’s a subtle and sometimes blurred distinction – particularly as some Recruitment Agencies also represent companies, and some Search firms will opportunistically introduce candidates to their client base on an un-retained basis, in an agency-style introduction.

For the most part, though, Search firms are retained on an exclusive basis to ‘steal’ someone from one of their client company’s competitors. So the client might say: “We need to find a new Head of Marketing for the EMEA Region”.  They usually set out a ‘wish list’ of the experience their ideal candidate needs.  In this case, this might include: experience of managing a team, experience of having worked for one of their top competitors, or another ‘blue chip’ firm; experience of working with the same types of customers, or having marketed the same types of products, etc.  On the whole, the criteria tend to focus on concrete track record rather than transferrable skills.  The mentality tends not to be ‘show me someone who has relevant skills and so could probably do this job’, but rather: ‘show me someone who can demonstrate a successful track record in doing this job, or one very like it, elsewhere’.

So the headhunter’s job is usually to find a square peg for a square hole.  ie. To identify someone who has done the same job for a smaller company, who might see this as a step up;  or someone who has been the number two on a similar team within a larger company, who might appreciate the chance to lead a team in a smaller company.

 

How does all this affect the job hunter?

First of all, Executive Search firms tend to work at more senior levels.  20 or 30 years ago, Searches tended to be restricted to the ‘C-Suite’ level (an American term for Board Level/Senior Management positions).  These days, Search is also used to find mid-level hires and, on occasion, even quite junior positions.  But, on the whole, if you have less than 10 years’ experience, you are unlikely to get much joy out of a search firm.

Secondly, search firms are not an effective route if you are looking to change what you do, or move to a new sector.  Search firms are good at finding square pegs for square holes.  If you are currently an Investment Banker and want to move to another Investment Banking role, then Search firms could be helpful.  But if you are an Investment Banker looking to become a Fund Manager, they are less likely to be helpful, because you won’t match the shopping list of criteria their clients have specified in terms of experience and track record.

Thirdly, search firms can be very slow.  Because of the focus on research, it can take between 3 and 6 months to fill a role.  In the Head of EMEA Marketing case above, a typical search process might be:

  1. To identity a target list of companies where potential candidates might be working (these tend to be the client’s competitors within the sector).
  2. For all those target companies, the Consultant then has to identify the Heads of Marketing and number 2’s in each of the EMEA marketing teams, finding out whatever they can about their career histories – this list of people is usually referred to as the ‘Research Universe’, and might include a couple of hundred people.  This can easily take a couple of weeks.
  3. Any candidates who look like they have the right track record on paper are then discreetly reference-checked to see how good they are at their jobs (confidential references are usually taken from former colleagues).  So the initial ‘research universe’ is whittled down to a ‘long list’, which comprises a list of 20 or 30 people whom the Search consultant thinks meet the criteria specified by their client.  This might take another fortnight
  4. The Consultant then needs to call all the potential candidates to see if they would like to consider moving to their client. All the candidates who agree to consider the role are interviewed and, sometimes, aptitude & personality profiled, to assess their fit for the role.  This might take another month.
  5. A ‘short list’ of five or six candidates is then presented to the client for interview, and Candidates usually go through several rounds of interviews with the hiring company.  Some companies can subject candidates to more than 20 rounds of interviews – others might restrict it to ‘only’ three or four: it depends on the culture of the firm and the position being recruited.  So this stage can take another six weeks to three months.

All in all, it’s a slow conveyor belt.  If you are already in a job, and have been approached by a headhunter to consider another role elsewhere, this is less of a problem, as you can focus on the day job while the conveyor belt rolls slowly forward.  But if you are out of a job and actively looking for work, the whole process can be frustratingly slow.

Fourthly, the hiring process through Executive Search is highly competitive, as the short list usually comprises a distillation of similarly-skilled and experienced candidates, pretty much any of whom could do the job. But out of every short list, only one gets the job, and four or five highly-qualified candidates get turned down. So after an arduous three to six month process, they find themselves back at square one.  All, in all, it is not a very efficient method for candidates actively looking for a new job, as the process is heavily biased in favour of the hiring company – which is fair enough, as they are paying the bills, after all.

Finally, and most significantly, Search firms usually have to offer an ‘off limits’ guarantee to the client, which means that they may not headhunt any employees from the client company for any reason.  This means that most Search firms only have between five and ten clients – otherwise they would have insufficient firms left to hunt in!  So Candidates actively seeking to move need to speak to a large number of Search firms (at least 10) to have any chance of covering the market.   This is the opposite of how one should manage Agency Recruitment firms, where talking to only two or three is enough to cover the whole market.  Agencies do not have the same off limits issues, and so are able to cover a much broader range of companies.  If you spoke to 10 of them, it would lead to all sorts of overlaps of coverage, and possibly cause conflicts between different agencies.

 

How to Manage Search Firms:

Using Executive Search firms is not an efficient way of actively seeking a job.  Unfortunately, you probably still need to talk  to as many of them as you can bear to, as they tend to be the gatekeepers for the retained jobs market;  and so you need to contact them if only to make sure you are on their radar.    But you should definitely not place too much hope on them moving you unless you are a square peg moving to another square hole.

In my opinion, Search firms are best managed as a medium term ‘passive marketing’ tool, remaining in touch with three or four Search firms at all times, using them as your eyes and ears on the market.  If you stay friendly with two or three of them, when you are actively looking for a job, you can tap them for information on whom you should be calling; what various firms are like; what hiring trends they are seeing, etc.  Then you can use that information to make your own direct approaches.

When actively looking for a job, you should contact as many search firms as possible.  I often meet people who tell me they have only met three or four ‘good’ search firms only.   This is completely wrong.   You should by all means talk to only three or four good Agencies.   But, when looking actively for a job through search firms, you should be talking to between 20 and 30 of them.   Don’t rule out the smaller firms.  Even firms you think look a bit crappy might sometimes get interesting searches mandates.   Companies are often poor at selecting their headhunters, awarding searches on the basis of relationships rather than actual capabilities, so you cannot necessarily tell which firms will get the most interesting mandates.  If you only talk to three or four, you are simply not covering the market due to the off limits issue described above.

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