What is executive search? Do you need it? How will it add value to your business?
What is head-hunting?
‘HEAD-HUNTING’, aka ‘executive search’, is the process of identifying, enticing and securing senior executives into key positions.
And ‘retained executive search’ is where an external search firm is paid an up-front fee to fill a business critical appointment.
To be ‘head-hunted’ applies only to someone who has been specifically identified for a particular position, approached for that role then hired into the company – unlike an active job seeker applying to a company or being introduced via a staffing firm.
The best talent is rarely available on the jobs market, so head-hunters will be very pro-active in seeking out those high performers who are heads down and happy! A good search firm will explore the best talent, regardless of whether the person is employed or in between jobs.
How can head-hunting add value to your business?
More successful hires.
At senior levels, successful appointment may result in a positive impact on business of up to 20%, while conversely a poor one could be minus 20%! So the better quality of the hire, the better the business outcomes and using executive search you can expect to land an exceptional candidate/s who can drive exceptional business results in the most critical areas:
- Maximising shareholder return
- Maximising profit
- Maximising sales revenues
- Maximising cost efficiency
If you are replacing someone currently in the job...
Often head-hunters are commissioned to use a cloak and dagger approach: to confidentially seek out a new hire without the incumbent being aware that they are being replaced.
Secondly, in the context of prospective candidates!
Senior execs do not respond well to a direct approach with concerns around confidentiality issues. They are more difficult to get hold of. However, the more senior the position, the smaller the number of qualified people who exist which means the more senior people get fewer approaches and are more likely to say YES to an exploratory chat with a head-hunter.
Importantly – the majority of employed execs would not entertain a direct dialogue particularly in the case of an approach from a direct competitor.
Saving you time
The more senior the appointment, the more time is required at every stage of the recruitment process from sourcing, interview / assessments, soundings, offer accept etc
Hiring cycles are longer for senior execs, diaries are busier more people involved and people more likely to be on notice periods
Today’s exec works 24/7/365 in a non-stop high pressure workplace and struggles to find the time with recruitment taking a backseat to more pressing demands, interruptions etc
What’s the difference between executive search & other recruitment services?
Is associated with senior appointments of a managerial or executive (Director / CXO) level and in some cases, very specialist individual contributor roles which are important or of a high impact, and very specialist nature. Executive search is typically used at salary levels £100k/ $150K plus.
Executive search is ordinarily delivered on a retained basis known as retained executive search, meaning money is paid to the head-hunting firm up – front: a retainer and then completion fees. If a candidate starts and leaves within 6 months, they will attempt to find you a replacement without additional fees except expenses.
A retained executive search firm, would normally spend upwards of 20 man days dedicated to an assignment – often more.
An exclusive arrangement. Market rates, in respect of fees charged are c. 30% of the salary.
Contingency and agency recruitment
Ordinarily referred to as contingency recruitment or agency. Such services are typically used at salary levels below £100k/ $150K.
Contingency recruitment is normally charged on a success only basis, no hire, no fee. If a candidate leaves, a rebate is normally given often 10% of the fee back for each week not worked within the first 10 weeks.
An agency or contingency recruitment firm, is more likely to spend days on the task rather than weeks.
Often a non-exclusive arrangement. Market rates, in respect of fees charged are c. 20% of the salary (at semi-skilled levels this may be less and at more senior, professional levels more).
Other recruitment types
There’s a grey area where roles are too senior or specialist to be effectively fulfilled by a standard agency approach and too junior to justify retained executive search.
This area presents somewhat of a hiring dilemma to employers and risk / reward to specialist recruitment firms.
Often employers will incentivise specialist firms to invest more time in the vacancy, deliver a specialist service by providing an exclusive arrangement and repeat business. For this to work well, the recruitment firm needs to have confidence in the employer, strong knowledge of exactly what is required and how to sell it, and that the employer will be responsive – since they are carrying all of the risk.
Charging basis: normally success only, sometimes a modest retain, often exclusivity and normally undertaken where there's an incentive of a repeat business opportunity i.e. special treatment for a special service
Call me to discuss your needs or fix a time to meet.
Robert Tearle, Managing Director
Robert Tearle Consulting, Venture House, Arlington Square, Downshire Way, Bracknell, RG12 1WA
International Tel: + 44 1344 668 373 | Tel: 01344 668 373
Robert Tearle Consulting is the trading style of Arena Search & Selection Limited, a limited company incorporated in England under number 4041116, registered office: The Old Bakehouse, Course Rd, Ascot SL5 7HL