Executive search: what it means for you
‘Hire character. Train skill.’
Those are the wise words of Peter Schutz, former President and CEO of Porsche. Executive search is a challenging industry, especially in today’s automated world full of AIs and bots who, let’s face it, can probably do your job for you.
So, we must ask the question: why bother?
First things first: what is executive search?
You hear the word tossed around a lot. Heck, you’ve probably even used it yourself. But what does executive search really mean?
Unlike employment agencies – who work on behalf of those looking for jobs – executive search firms work on behalf of a client looking to fill a role. Recruiters spend their time identifying, interviewing and actively seeking new and exciting candidates to fulfil the roles and requirements laid out by a client company.
According to the Association of Executive Search and Leadership Council (AESC), executive search in the technology sector has reached 64 percent this year, most notably in cyber security and CSO sales roles, which grew 7 percent from 2016.
In a world now fuelled by digitalisation, it’s clear to see that clients still rely on humans to perform roles within organisations and evidently, they rely on humans to place them.
Contingent vs. retained search
Executive search has two core avenues to follow, contingent search and retained search. Both are equally as important as the other, but the approach to handpicking the perfect candidates is a little different.
Retained search requires the client company to pay a fee upfront for the work conducted, and once the candidate has been placed they then pay the outstanding total, which factors in the initial deposit to conduct the work.
This process of search is usually more consultative in nature, and the client company often uses this method to approach an outside specialist firm to not only fulfil their candidate requirements, but to educate the client on what sort of person is needed along the way.
Because of this specialisation, retained executive search is usually used to fill roles where direct decision making is to be made, and where the character of a person has a direct influence on business progression.
Contingent search, then, requires a company to provide a narrower scope of candidate to the executive search firm. Often, the client company will know the exact requirements needed for a role and will outsource this work to a search firm with the capabilities of shortlisting and selecting the right candidates for the job.
This method is often used when companies are looking for mid-level employees who hold the right skills to help drive the business forward, but may not directly impact the direction of the business.
What does this mean for you?
Carlos Ghosn, the CEO of Renault, once said:
'Employees are your most valuable assets. They are the heart and guts of a company.'
Identifying, shortlisting, interviewing and finally recruiting a candidate for a job role requires massive amounts of time and resources from any firm. In the technology sector specifically, firms are experiencing rapid rates of evolution and, as a result, are finding themselves squeezed from all angles.
Not only are they short on staff, their internal recruiting staff are under-funded and over-worked, leading to mis-matched candidate placement. 70 percent of in-house solutions fail, costing a company an average 12 percent more to recruit. In the words of Singapore’s first Prime Minister, Lee Kuan Yew:
If you deprive yourself of outsourcing and your competitors do not, you’re putting yourself out of business.