Digital Transformation and Its Impact on Executive Search
April 15, 2021 – Jack Saxton is a director with Tempting Talent, the talent arm of Tempting Ventures, a recruitment-focused venture capital firm. Tempting Talent, founded in 2017, was created to support Tempting Ventures’ mission to help establish specialist recruitment entrepreneurs in new and exciting markets. Since then, Tempting Talent has grown to become a leading recruitment-to-recruitment business, working with recruitment firms from the U.K. and U.S. to help them expand. “Our mission is to empower people to reach their potential through careers in recruitment,” said Mr. Saxton. “We aim to do this through access to the right information, opportunities, and people that maximize the chances of professional success, and by helping people find purpose and meaning in work to lead as fulfilled and happy lives as possible.”
Mr. Saxton recently sat down with Hunt Scanlon Media to discuss the economy and how digital transformation is changing the executive search sector. Following are excerpts from that discussion.
Jack, from your unique vantage point tell us what’s happening across the recruiting sector at the moment.
The executive search industry has turned the corner – we would argue that it has fully returned to normal and is, in fact, once again booming. As a search-2-search firm operating within the U.S., we receive a bird’s-eye view of the hiring economy via our clients operating across virtually all hiring-sectors in recruitment and executive search. Since December, we have seen a massive uptick in hiring across professional & financial services, healthcare and life sciences, and digital and creative.
Due to the heavy demand for healthcare professionals during the pandemic crisis, this sector boomed in 2020 as did the life sciences, including areas like therapeutics, genetics, and biotechnology. White-collar professional services were not at the forefront of COVID-19 and, given a lack of preparation, stumbled massively in 2020 leading to the largest decline in talent acquisition we’ve seen across professional and financial services since starting Tempting Talent. Saying this, COVID-19 led to one of North America’s largest surges in digital transformation across the workforce in modern history and recruitment and talent attraction has been near the center of this.
How have your clients embraced this?
Virtually all our clients by the fourth quarter of 2020 had implemented digital tools to promote their business and reflect their clients who had begun hiring again due to results of similar changes. Technology, digital, and creative bounced back quickest and we’re now seeing the return of traditional white-collar services leading to the boom we’re seeing in the market now.
What expectations do you have for the search industry for the rest of the year ahead?
Digital transformation across recruitment and executive search means that there remain virtually zero borders in the fight for talent. That is a massive shift in thinking about work and where we work. We are at the forefront of this, and I cannot emphasize enough how incredible and damaging this will be for existing and up-and-coming recruitment and executive search businesses.
How so?
For example, an unhappy recruiter working in Cleveland in 2019 would not leave his employer because he would have had a non-compete designed with region and scope in mind. As a result, he or she remained and decided to put up with bad management, poor culture, or a terrible compensation structure – perhaps all three! This has been the story of the recruitment workforce across the majority of America since the industry formalized itself. It is only since this year that industry-wide adoption of digital transformation would allow this unhappy recruiter to stay in the location where he or she desired and seek work out-of-state and improve his or her quality of life. Now ask yourself a question – how does a Cleveland-based search firm compete on salary with a San Francisco based search firm? How about benefits? Commission and fees? Level of work? The answer will be tough to swallow for some, but it is very apparent to us.
How impactful will this be?
This will be the most impactful change of COVID-19 on our industry. If San Francisco and New York recruitment firms expand outside of their home states remotely and bring their compensation structures and clients with them it will be the end for the majority of Midwest regional search and recruitment firms. They either compete or are swallowed whole and must be prepared when the inevitable coastal search firm comes knocking to take their internal talent away from them. It is a brutal reality that we already see coming true.
