We all know that hiring the right leaders is critical for the successful outcome of every organization. But in this era of great change and transition in the search industry, here’s one reality recruiters are grappling with: savvy clients. Under increasing pressure from competitors to shareholders, talent leaders need new hires who can make an immediate difference and, more importantly, will stay around for a while and grow with the company.
That’s why clients these days are demanding more from search firms, and are closely scrutinizing how to get the most talent bang for their recruitment buck. But how, exactly, do executive recruiters fit in — and not fit in — with your talent planning process?
One recruiting firm, Y Scouts, based in Scottsdale, recently offered some fascinating observations, developing six key points that clients should never simply accept from a search firm, dubbing them “industry insights to shape a new reality for your recruitment efforts.”
Founded in 2012 by Brian Mohr and Max Hansen, Y Scouts serves a diverse client base that ranges from small family-run operations to Fortune 500 companies. In its efforts to disrupt the industry, the firm advises clients to look harder at how their search firms go about their work, and challenge them to do better. Here’s their six perceptive insights:
1. ‘Slap-the-logo On It’ Posts
Frequently, Y Scouts points out, a business will create a job specification, then bring in a search firm that does little more than take that description, add its own logo, and post it. “Simply changing the label on the packaging adds zero to the recruitment process,” said the search firm. “Candidates lose excitement to apply when they see a staffing company’s name on the job ad. They know they will have to go through a middleman instead of going directly to the company.” Bottom line: Be sure this is not the primary practice you are paying top dollar for when hiring a search firm.
Koya Leadership Partners, which focuses on searches for the non-profit sector, views the job description, or ‘position profile’ as they call it, a critical external marketing document that introduces the job opening to the market and reflects its client’s brand. “We spend a great deal of time ensuring that the document offers insight into not just the role itself but the organizational mission and culture,” said Molly Brennan, founding partner and CEO of the Newburyport, MA-based firm.
“I often talk with clients about how to differentiate between a position profile, which is an external marketing document, and a job description, which is an internal document that captures all aspects of a particular role and should be used as part of the performance management process.” An external position profile does not need to include a laundry list of tasks and responsibilities, she noted, but it should provide a concise overview of the organization and the role “and compel a candidate to want to learn more.”
2. Off-Limits Agreements
Obviously, the bigger search firms have greater numbers of off-limits challenges that oftentimes leave the best prospects off the table. “This is where service-driven, personalized boutique firms have an advantage,” said Y Scouts. “Because they’re not primarily focused in just one job function or industry, their ability to tap into the best of the best people is rarely, if ever, impacted by an off-limits agreement.”
3. Commission-Paid Recruiters
Given that search consultants tend to collect a commission for closing assignments, in addition to their base salary, some have questioned whether a recruiter’s personal interest in filling a job can take precedence over finding the right person. “This work is about matching the right person with an organization because it works for everyone,” said Y Scouts. “It is not just for the monetary benefit of the search professional.”
John Ricco, a partner with Atlantic Group in New York, said that the best strategy for a recruitment firm is to keep the focus on helping clients find the best talent for their individual needs. “In other words, finding the best possible fit for any job requisition that we’ve been hired for whether temp, perm etc.,” he said. “If a recruiter is only looking at their commission and not the needs of the company they’re representing they won’t be in business long.”
Mr. Ricco said it’s been his experience that when you do the right thing by your client and candidate at all times then commissions come as well as repeat business. “Simply put, recruiting is about relationships and the recruiter with the best relationships combined with first class customer service usually win.”
4. Misaligned Interests
When a candidate is hired, search firms typically receive a percentage of the individual’s overall first-year compensation. So it is that search firms make more money from recruiting better paid talent. This “carries an implied misalignment in interests,” said Y Scouts. This could be why more organizations are choosing an executive search firm offering a flat fee, or fixed rate, model.
5. Ignoring Values, Purpose and Culture Alignment
Too often, Y Scouts said, recruiters get caught up in the skills needed for many positions and in drawing talent away from the competition. Neglected, meanwhile, are more critical factors, like purpose, mission, philosophy, culture, values, and overall leadership alignment. “The search business has been largely dominated by resume-matching to job descriptions,” said the search firm. “But ignoring purpose and culture leads to mismatches and requires damage control down the road.”
“It’s vital that recruiters go beyond skill-set to incorporate culture and personality fit,” said Koya’s Ms. Brennan. “Study after study shows that personality and culture fit are the key ingredients to a long-term, sustainable hire. Hires don’t typically fail because the hard skills, which can be evaluated on a resume, aren’t there. They fail because the candidate is a poor culture and personality fit,” she said. If a recruiting firm isn’t digging into culture and incorporating it into the assessment process, they are doing their clients a disservice, she noted.
6. Going Back to That Same Old Database, or Rolodex
Having an expertise in one sector or position can certainly be valuable for a search firm. At the same time, however, perspective can be lost. Recruiters who continue to mine the same collection of talent inarguably boosts the financial opportunities for those few ‘star players’ through increasingly better salaries, bonuses, and so on. But at what cost? “The practice is simply short-sighted,” said Y Scouts. “Every search should be approached as brand new. Search professionals should never assume they have somebody who’s surely the right fit.”
Ms. Brennan concurred. “Search firms that continually go to the usual suspects or shuffle a small group of candidates around from client to client are not only utilizing lazy recruiting practices but they are inhibiting growth and opportunity for new leaders, including leaders of color, who are sorely needed in both the for-profit and non-profit sectors,” she said.
This practice also hurts clients, she added, who deserve to see fresh talent that has the potential to transform their organizations. “I think any executive recruiting firm worth its fee should approach each new search with fresh eyes, conduct extensive research to identify previously unknown candidates, and present its clients with slates that include new faces and ideas.”