How to Choose an Executive Search Firm
“Of all the decisions an executive makes, none are as important as the
decision about people because they ultimately determine the
performance capacity of the organization.”
Peter Drucker; Past Professor at the Peter F. Drucker Graduate School of Management
Steps to Selecting a Search Firm…
If pressed to identify the single most important factor from your past that had the most positive impact in your life, how would you respond? A 10-year longitudinal study found that 92% of people who were asked this question pointed to a person or persons, rather than a fortuitous event(s) or life circumstance(s), as being most responsible for moving their lives in a positive direction.
If you occupy some variation of the role “talent acquisition decision maker” in your organization you are not surprised by this finding. Were someone to ask you “What single factor has resulted in the most positive impact in the life of your organization?“ you would quickly identify your employees, or more specifically particular employees, as being that factor.
But the next question is more difficult to answer. “How do you identify, attract, and hire those “particular employees” for your organization?” or as Jim Collins has popularized in his widely acclaimed book Good to Great, “How do you get the right people on the bus?”
Reaching out to an executive search firm often plays a key role in answering this question. Executive search firms are talent acquisition specialists who invest their entire careers focused on helping their clients identify, attract, and hire the most qualified individuals for their unique organizational needs. But how do you choose the right search firm for your organization?
This is definitely not a “one size fits all” answer. The following 14 Questions are offered to help guide your decision making process:
1. What is the search firm’s process?
There are two main considerations here. First, how do they qualify the position in question? Do their methods demonstrate a clear ability to flesh out the complete nature of the position and the culture of the organization? Second, how do they manage the search process itself? How will they identify, access, and attract the most qualified candidates for the position? Will the search firm rely primarily on a database or job board advertising or will they actively recruit passive as well as active talent for your specific needs.
2. Will the search firm be a “credible ambassador” for your organization?
The firm that you select will be a direct reflection of your company and brand. Get to know the principals, their level of professionalism, and to the degree possible their reputation in the business community at large (ask for client references). These issues will directly impact a search firm’s ability to gain access to high level professional and executive talent…not to mention encourage positive (or negative) branding for your company.
3. Who will actually be handling your search?
Will your search be handled by the best people for your particular project and will your project be given a high level of priority? Will you have direct access to the recruiters handling your search? What are the professional credentials of these recruiters?
4. Do the consultants understand the real strategic, operational, and financial importance of the position and possess the skills and experience necessary to recruit for that opening?
Does the search firm demonstrate a knowledge of your organization, its business units, products and services, corporate strategies and outlook. Do they know the competitive forces that you face and the type of talent that would give you a competitive advantage in the marketplace?
5. Does the search firm have knowledge of the industry and type of position in question?
Knowledge of the industry and the skills and experience necessary to excel in a position are critical to search success. You will also want to know that the firm has the ability to leverage a well-established network of contacts.
6. Does the search firm offer qualified professionals who can objectively assess a candidate’s soft skills?
Research on 181 jobs at 121 organizations worldwide showed that two out of three abilities vital for on-the-job success were emotional competencies — self-awareness, social awareness, adaptability and a talent for collaboration (Goleman, 2002). A search firm should have individuals who are professionally trained to evaluate talent for the presence of these skills.
7. What are the firm’s metrics related to typical benchmarks for search projects?
Ask about the average time to compete a search, often referred to as “average time to fill.” How often can you expect progress reports? How long will it be before you can expect be begin interviewing the first candidates? What percentage of searches does the search firm actually complete? What is the search firm’s retention rate (stick rate) during the first twelve months following placement?
8. What kind of service can you expect after the completion of the search?
Post-hire integration of new hires into an organization is greatly facilitated when a search firm continues to follow-up on placed candidates. A good firm will stay in touch with placed candidates, helping to prevent and if necessary troubleshoot problems that often arise in the first 30 of starting a new position.
9. What is the “guarantee period” offered for new hires?
What happens is a new hire quits shortly after being hired? Most search firms offer a replacement guarantee if a new hire quits within a specified period of time following their employment. Also, how long does the search firm commit to work on a search?
10. What is the current search load of the firm’s consultants?
It is a rare recruiter that can work over 5 searches at a given time without the quality of their search work beginning to decline. Be sure that your consultant can give your search the time that it requires. Bear in mind that this is impacted by the level of service that you are buying. A retained search will be given a higher priority than a contingency search.
11. What are the fees and their policy on expense reimbursement?
Does the search firm offer a clear fee arrangement in writing? Which expenses will be billed separately? Are billed expenses really a hidden profit center for the company? While a search firms rates should be competitive, be wary of selecting a search consultant based solely on the quoted rate alone.
12. Does the company utilize any structured forms of retention-variable analysis to qualify potential candidates?
Professional search firms should not only qualify candidates based on skills and experience but also screen applicants using factors known to influence retention. Do they communicate regularly with the candidate during the post-hire integration phase to assist with retention? Research has found that the cost to replace an employee is normally 120-130% of that employee’s annual compensation. You want to avoid a candidate’s early departure if at all possible.
13. What “Off Limits” policies would the search firm face when seeking to recruit the talent that you seek?
Large search firms or those who are overly saturated in a singular industry often cannot freely source the talent that you seek because of their off-limit restrictions. Off limit policies simply means that it is unethical for the search firm to source candidates from existing clients. A good rule to be sure but too much exposure in a particular industry can limit their effectiveness if asked to recruit for your organization.
14. Ask for client references.
A search firm should be able to give you strong professional client references related to the search relevant to your search.
CSI’s multidimensional approach for finding the best active and passive candidates produces valuable results to our clients. We thoroughly enjoy contributing to each client’s bottom line through strategic talent acquisition with a retention mindset. We take our work seriously, and our clients reward this with repeat business (Testimonials). CSI’s track record of success in filling our client’s most difficult strategic talent needs is solid.
Client Request for Services: Let CSI Executive Search know of an opening or openings of strategic importance to your organization by submitting a CLIENT REQUEST FOR SERVICES. Or, give us a call at 877.329.1825.