By Dr Marianne Broadbent*
Executive Search firms are an integral part of how smart organisations find the executive and senior management talent that they need. They enable candidates to be drawn from the whole potential candidate pool, rather than those just looking for a job at a point in time, and search also involves a level of ‘advocacy’ for the client.
Amongst the most frequently asked questions we address are ‘what do search firms actually do’ and ‘how do they do it’. Clearly, their role in the talent acquisition and development process, and how they work, often seems shrouded in mystery – as if they do their work through a mysterious ‘black box’. It is partly the way it seemed to me too before I became a Senior Partner in EWK International, and starting assisting clients with their talent acquisition challenges.
It’s useful for any executive and manager to understand the nuances of recruitment and search services and how they work. Apart from seeking the best talent available for your organisation, you might find yourself in a situation where you want to be ‘noticed’.
In a personal sense too, it’s helpful to understand the market you are in, the scale of typical organisations and appointments and how your experience compares.
Know the recruitment and search landscape
While many organisations undertake their own recruitment, most, at some stage, use a recruitment or search firm.
Broadly, there are three different types of recruitment and search firms which tend to relate roughly to levels in the workforce:
• Contingent Recruitment firms operate at the entry to middle levels, where firms work on the basis of a fee for a placement. This is often where ‘bulk recruitment’ takes place: that is, where an recruitment firm agrees to provide a certain number of qualified people for particular roles each month or year. These firms will be heavily driven by their databases, and increasingly the use of social media such as Facebook or Linkedin.
• Retingent Recruitment firms generally operate at the middle levels where positions are advertised, and today mostly means advertised through online services and social media. Many of the press advertisements you will see for roles in the commercial sector are likely to be from these firms, though some might do some pro-active identification of candidates. Think of them as between the Contingent and Search firms.
• Retained Executive Search firms operate at the more senior levels, or where there are specialist skills that are hard to locate. Clients such as CEOs, Boards, heads of government agencies or businesses, and other executives contract with an Executive Search firm to conduct a pro-active search for a particular position. As with Recruitment agencies, search firms draw on sources as their own databases and will also utilise some social media sources such as Linkedin. But they will also do original research, map the field in terms of other relevant organisations and sources for candidates, and proactively reach out to potential candidates who are not looking to change from their current roles. They will usually have good networks in the spheres in which they operate, be they particular industries, government or community organisations
In this column we will focus on the work of retained Search firms. (The next column will address that other frequently asked question ‘how do I get noticed by a search firm?’)
The ‘retained’ description refers to the fact that Search firms work on the basis of an initial ‘retainer’ or agreed fee to commence the search. Search fees are usually being paid in three instalments: the first on being commissioned to undertake a search; the second about 30 days later or when an agreed shortlist is provided to the client; and the final payment is invoiced when the preferred candidate signs to accept the offered position.
Searches are usually commissioned on an exclusive basis, that is, one search firm is awarded the work for a particular role.
All types of organisations use Search firms for senior or specialist roles and that includes government departments and agencies (federal, state and local), commercial firms, and the large not-for-profit organisations. In public sector organisations the roles are usually at the Senior Executive Service level (or whatever name it is given in different jurisdictions).
Using an Executive Search Firm can provides access to a richer and well assessed candidate pool
Using a retained executive search firm means that an organisation can have access to 100 per cent of the candidate pool, rather than just those who might be looking for a new job or who have noticed an ad while having their morning coffee on a Saturday.
Using a retained executive search firm to conduct a search is about finding the right person for the organisation and position. Online or newspaper advertising and ‘word of mouth’ will usually identify those who are looking for a job. The essence of the search process is to identify and qualify people who could do the job well, but are not currently looking for a job and who are comfortable with where they are now.
The next step is to advocate for the role with high quality candidates. For candidates who could be considered for shortlisting, good search firms will complete a thorough behavioural assessment. (At EWK we use the same rigorous approach for search candidates as we do for our talent development and succession planning work). The search firm’s goal is to identify and access what might be a quite specific candidate pool and also to minimise the client’s risk in the process. And to clarify another sometimes contentious issue, good search firms automatically include any potential internal candidates as part of the process.
Searches often need to be done with a great degree of discretion – and not just for the sake of potential candidates and how their firm might view their interest in another position. It’s important to realise that over 70 per cent of the people placed with the involvement of search firms are not actually looking for a new job at the time they are asked if they are interested in being considered.
For example, in the government sector, this can mean identifying people in other states, or federally for a role a state government position, or perhaps the commercial sector. In attracting people whose predominant experience in the commercial sector, it is critical to clarify motivation and values fit.
What level of appointments are suit to Executive Search versus a standard recruitment approach?
Traditionally search firms have been focused on ‘C’ level executives, such as CEOs and a level or two below that in large organisation, as well as Board positions. In a large organisation the search organisation might be used for levels below that for a combination of reasons.
This can include the scarcity of and competitiveness for good talent or the emergence of new and different types of positions. It can sometimes be because firms do not want to ‘telescope’ their business moves by more openly identifying the type of talent they are seeking.
We recently completed several searches in this category where commercial organisations were looking to build their digital products and services expertise. Thus competitors were not alerted to the client’s desire to move more aggressively into this area.
A considerable part of the search firm’s role includes advocacy for the client to those potential candidates, explaining the merits of working for that client, or why a $70-100k drop in salary would be a great idea to working in the public sector or for a not-for-profit organisation where you can really make an impact.
If the task of search firms is to develop a field of potential candidates who could fulfil a specific role or roles, how do they find out about you? In the next column we will explore that challenging FAQ: ‘ How do you get ‘noticed’ by a search firm?’
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