HOW TO EVALUATE and SELECT an EXECUTIVE SEARCH FIRM

By: R. Gaines Baty  

  INTRODUCTION

While the current demand for search projects is temporarily lower than normal, some more important talent requisitions dictate that a  “professional search” is still the most appropriate tactic for the circumstances and requirements at hand, and a wise investment.  Further, as the market starts to turn back in a positive direction, the frequency and necessity for “searches” will surely rebound dramatically.  In either case, the challenge and critical nature of choosing the right firm can make or break the ultimate success of the search project, and ultimately your related business initiative.   Any given firm is suited for certain search projects and clients, more so than others.  Absolute care must be taken in evaluating and selecting a search organization that best suits your needs and fiduciary responsibilities.

MISCONCEPTIONS / MISTAKES

Oftentimes, corporations engage a particular executive search firm based upon the wrong reasons…such as size, “brand” name, number of offices, price, or numerous other tangible reasons.  These may be factors in some cases, but when working with a search firm, the subtleties of that organization, and your relationship with them, are the major factors of failure or success.  In other words, “the devil is in the details.”  Therefore, any front-end due diligence should evaluate the following more important attributes.

MOST IMPORTANT / APPROPRIATE SELECTION CRITERIA

Selection criteria should include:

• ·         Expertise in your industry / specialty need.  Keep in mind that some industry or functional “experts” may not be the best recruiters.  Your best choice may be the one that has a good exposure and working knowledge of your market, has a network into that market, and asks penetrating questions, and who also knows how to sell.  Further, what have the principals who will conduct the search done in your field, as opposed to someone else in a faraway office…who will not be involved in this project?

• ·         Do they work at the level of this assignment?  You do NOT want a CEO- or Board-level search firm looking for a Manager or a VP any more than you want a staff-level recruiter attempting to evaluate a senior executive.  The firm should be excited about, committed to, and capable of completing this assignment.

• ·         Success / Completion ratio…What percentage of the firm’s searches were filled successfully in the past 3-4 years?  Reliable sources indicate that 50-55% completion ratios for “name” retained firms are accurate, and as low as 5-10% for contingency agencies.  Gaining this completion ratio information may require forceful probing, and/or a lie detector test, if the firm is not proud of their track record.

• ·         Off-limits restrictions…If the firm works with too many clients, or your competitors for talent, your selection of candidates may be restricted as a result.  Also, will they shop your active candidates to other companies while you are still evaluating?  Will your company be off limits for their future searches, and for how long?  What are their policies in these areas?

• ·         Search “partner” involvement in the process. Will s/he be involved in the research, search, screening, evaluation, negotiation and closing of your candidates for this search?  Some search “partners” sell the deal, delegate the project(s) to an overworked team for delivery, then go to sell the next deal.  Many are measured on revenues (searches sold) vs. completions.  You certainly want and deserve more.

• ·         Do you have trust and respect for the key individual and his/her team.  These individuals will determine the success of your search, more so than the firm’s “dozens of” offices.  Will this person/organization persevere with the project through completion if and when the going gets tough?  Further, will you be proud for this person to represent your company.  Professionalism is not as popular a word as in the past, but the quality itself is as important as ever.

• ·         A “brand” name does not necessarily mean that they represent the best solution for you.  Conversely, a boutique or “little known” firm (with proper due diligence) might be your best bet.  Again, it’s the individuals involved, and the prioritization and commitment to your project, that make a search successful.

• ·         Candidate Evaluation capabilities and procedures are often overlooked.  How do they evaluate a prospective candidate for possible presentation to you?  And how do they present these candidates?  How do they contribute to your decision process?  Dig for details.  Are they really looking out for your best interests, or just trying to sell their favorite candidate?

• ·         Comprehensive search process.  Good candidates can come from many different sources.  In order to develop a healthy selection of finalists, a multi-pronged, comprehensive search process should be employed.  How do they do this?  For example, an “internet” recruiter will usually find only those candidates that have posted on the resume boards, are “looking,” and who are not necessarily the top performers for your competitors.  Can and will the search firm do the more difficult and tedious tasks required to selectively source your competition and industry for top talent?  Even in a candidate-rich market, it's still important to tap the happy, working, "non-looking" candidates.  You want the best candidate(s) from any and all sources, so a comprehensive search is important.

• ·         Tenure /  Repeat Business.  It’s best not to trust your career or business to a rookie, or based upon the “contingency” that an ill-selected firm might find someone good for you to hire.  The right recruiter for you will have been successful on the tough searches, will have strong repeat business, and will have references to prove it.  Check them out.

CONCLUSION

The products of these searches, the newly hired executives themselves, are ultimately critical to an organization’s success.  The initiatives and/or decisions in which these new executives partake can make or lose millions of dollars.  Don’t underestimate the importance of, or the details involved in, a proper evaluation and selection of the right recruiting organization for your search projects.