6 Critical Factors for Selecting the Right Executive Search Firm
May 6, 2021 – If the past year has taught us anything, it’s that leadership matters. Whether you are bolstering your C-suite to support continued success and growth or seeking executives to help redefine your strategy in the face of change, you need an executive search firm that can connect you with leading-edge talent.
A new report from The Bowdoin Group and authored by president Scott Aldsworth, who leverages 25 years of experience in the recruiting industry, sets out six critical success factors to select an executive search firm:
1. Extensive expertise in your industry
To find a qualified leader for your company, you need an executive search team with expertise specific to your industry. The search firm should have resources dedicated to your vertical, including a senior partner and team members who understand what it takes from a talent perspective to drive success and growth.
“They should have deep knowledge of your key leadership positions, the responsibilities of these roles, and the attributes that define qualified executive talent,” The Bowdoin Group report said. “Most importantly, they should have their fingers on the pulse of your industry, staying on top of news and trends, identifying key opinion leaders and influencers, and continuously expanding their network of relationships.”
2. Credibility and connections
To find the executive talent that everyone in your industry is talking about—the thought leaders, the trailblazers, the individuals currently heading the companies you aspire to be—your executive search team must have the credibility to engage them, according to The Bowdoin Group. “To open doors and engage with the caliber of candidates you desire, ensure an owner and/or senior partner of the firm is leading your search, rather than handing you off to a more junior associate,” the firm said. “C-suite executives are more likely to return a call from someone with a similar level of seniority and experience, vs. someone just entering the field.”
Confidentiality is also a key consideration when conducting an executive search, particularly when you are replacing an incumbent leader. “Your executive search firm should have a proven track record of representing companies with professionalism and discretion,” said The Bowdoin Group. “Don’t be afraid to ask for references to assess the firm’s reputation among clients and business communities.”
3. A well-defined executive search strategy
A successful executive search requires a well-defined strategy. “The search process can be challenging and complex, requiring the identification and assessment of a wide range of individuals to pinpoint those very few who meet your specific needs,” the report said. “Finding your next leader is an art and a science – not a shot in the dark. They should have the ability to find and recruit the best people in the market, not just the best people in their network. This is the key difference between securing a ‘good’ vs. ‘great’ pool of executive talent.”
“Leveraging a robust research function, a superior search firm will assess the market to identify candidates who match your criteria and desired location,” the search firm said. “This includes developing a list of companies or organizations where these individuals are currently employed. During this process, the firm will determine how realistic your search is, and if an executive candidate who matches your specific criteria even exists. An exceptional search team will have the expertise to validate your criteria where it makes sense, but also challenge your search when it limits hiring potential.”
4. Proven commitment to DE&I
There’s growing recognition of the importance of diversity, equity and inclusion when it comes to executive leadership teams. The McKinsey 2020 Diversity Wins report revealed how companies with more diverse executive teams (gender, culture and ethnic diversity) are “now more likely than ever to outperform less diverse peers on profitability.”
“While many are “jumping on the DEI bandwagon” because they view it as a trend, ensure your chosen executive search firm understands its importance to the success of your business and has a proven strategy to help you build a diverse, high-performance leadership team,” The Bowdoin Group report said.
5. Full transparency into the talent search process
With a top-tier executive search firm, your search process shouldn’t be kept a secret from you, according to The Bowdoin Group. “Select a firm with a transparent approach, where they openly share information at each stage of the process,” the firm said. “Rather than telling you we have some good candidates in the pipeline, they should be willing to tell you exactly how many they have reached out to and how many are interested and engaged. To perform an informed and targeted search, your firm must have a technology platform capable of triangulating information to deliver advanced analytics on what candidates are out there and which ones are right for you.”
6. Capabilities to grow with you
You want an executive search partner who can grow with you. While your priority right now may be to find that perfect chief revenue officer, in a few months you may find yourself needing to hire a variety of positions at once, or even deciding to completely outsource your recruiting function. “If you are investing time and resources into an executive search firm so they can develop a deep understanding of your organization, customers and culture, make the most of that investment,” The Bowdoin Group report said. “Select a firm that can do more than find one piece of your leadership puzzle. Find a team that can support your company as it grows throughout its entire lifecycle.”
An executive search firm that understands your industry and has worked with companies on a trajectory similar to yours should understand the required personas to support your growth, according to The Bowdoin Group. “The team should have connections with these individuals through its network—and know how to find them,” the firm said. “When you find a partner like this, they will be well equipped to present you with candidates who are more likely to thrive within your particular environment and play a key role in your success because they intimately know your business.”
Don’t Settle for Good
The success of your company is highly dependent upon those leading it. The last thing you want is to reach the end of an extensive and costly search process with a pool of “good” candidates and be forced to choose one out of necessity. “When evaluating executive search firms, do your homework up front, ask the right questions and watch out for red flags,” The Bowdoin Group report said. “See what others in your industry are saying about them. Ask for references. Make an educated decision before you bring them on board. While it will take a bit more work up front to perform this due diligence, envision the end game where your firm presents that individual with whom you have the confidence to entrust the future of your business.”
Setting Realistic Expectations
When deciding to retain an executive search firm, Rich Rosen, founder of Cornerstone Search, said that “it is important to know what the full scope of the role is. It may sound silly to some, but we help many companies shape and establish the role, duties, responsibilities and how they will determine if the hire is successful a year from now.”
“Experienced recruiters know the market, have a network, and key relationships that will allow them to attract the best candidates quickly,” he added. “The bottom line is that great recruiters know what rocks to turn over. More importantly, they can and should advise the client if they have realistic expectations. Unchecked expectations result in poor results and often a long unsuccessful effort.”
Conducting searches during the global pandemic, Mr. Rosen said, has “actually been easier in many ways as people are at home. The bigger issue has come from getting through the mass amount of spam people are getting. The market is on fire and people are now looking for a great culture as much as they are solid compensation.”
Market Credibility
“Our first piece of advice is the search firm must have a really genuine understanding of your business, the CEO, the board and the executive,” said Simon Hearn, chairman of Per Ardua Associates. “At whatever level they are recruiting for you, they are going to have to sell the idea of your company and the market that it is in – they must understand it. It would be worth questioning them for some time on their knowledge of your business and the market it is in. Then you need to ascertain whether they have the knowledge of that market. For this reason – you should probably go for a specialist rather than a generalist firm. Has the search firm gained credibility with you and have they got the credibility of the markets they are in?”
Recruiters need to impress with their knowledge, but clients should also check this out with some references from other companies, Mr. Hearn said. “Commonly missed by client companies is the subject of off-limits. The search firm must be upfront and transparent on this issue – who can they not approach for you in the market. They should demonstrate a transparent and well-defined search strategy. Critical in modern day, high-level search is client feedback. The search firm should definitely tell you they will be checking in with you for a debrief at the end of the assignment. We will often do a feedback process midway, too.”
Mr. Hearn also said clients need to look for a search firm’s commitment to diversity and inclusion. “This must be in actions and not just words. You should question the search firm heavily on the successful placements that have been diverse – their track record, how do they source and check for diverse candidates. This should not just be just female diversity but non-white and other diverse candidates. You should question them on how they ensure they get these candidates in their search process and also give them an idea of how many diverse candidates you are expecting in your long and short lists.”
Listen Carefully
“First thing is to consider is a difference. A executive search firm is different than the search person,” said Russ Riendeau, senior partner and chief behavioral scientist with New Frontier Search Company. “The firm is what is marketed to secure retainers. The search professional you will be working with is the more critical factor in making your decision. Can you determine the search intelligence level that exists in the direct contact you will be working with at the firm? How many years of search experience? How many searches have they worked on? What level of behavioral interviewing/motivational interviewing training do they have? Do they have a broad range of self-awareness in how to evaluate talent, job pattern decision making in candidates?”
Dr. Riendeau said that the second thing is to listen carefully to what questions that search person is asking you. “Are the questions well-stated, timely, tough, direct and insightful? Do they sound different, intelligent and perceptive to what you really need to consider compared to the standard-issue questions you’ve heard? Did the search person challenge your current job spec and what expectations you have in the role?”
“Diversity and inclusion are important and we as search professionals are fully aware of the pressure companies have to find talent in the diversity arena,” said Dr. Riendeau. “And we also know the challenges to invest excessive time and money on a search that is not priced adequately for the research that goes with the effort. If you’re a small company this may not be important at all. If you’re a large company, be careful of easy marketing pitches search firms will state to try to appear to be appropriate.”
“Pandemic timelines to fill searches are off the charts,” Dr. Riendeau said. It’s tough to get peoples’ attention—even if they are looking. It’s tough for people to make career decisions when too many factors are in play around safety, income, kids at home, health issues, travel fears, etc. The better a company’s job spec is written and if flexible on the experience that can be considered, the less time it will take. Again, goes to the intelligence level of the search partner you are working with. Listen to the questions they ask.”
“People are stressed, anxious, frozen, indecisive and often unable to really have the data/emotional strength to make a job change that may be a stretch,” said Dr. Riendeau. “As a recruiter and psychologist, I see this in both candidate reluctance and in client behaviors as well. Hiring managers less apt to take a risk on a candidate that is not a safe hire. Managers are busier and distracted than ever, so they are not moving as quickly with good candidates and they end up losing the candidate to another offer or the candidate decides that manage may difficult to work with and bow out of contention.”
Full Visibility
“Step one is for the organization to confirm that retained search is the best resource for their particular requirement,” said Joanna Miller, founder of Miller Black Associates. “Once this is decided, the selection of which firm to use should ideally be based on such factors as successful past experience with the search firm and the particular consultant; the firm’s specific experience with recent relevant searches, and the outcomes; who exactly in the firm will be executing the search, and the workloads of the consultants involved—both their search loads at present and what they are likely to add during the course of the search.”
“A word of caution—be careful when the firm is pitching a team approach,” Ms. Miller said. “It is important to get full visibility into what the specific role of each team member will be, the qualifications and capacity of each of them, and who exactly is accountable for what. There is also an important chemistry component: Are you going to enjoy the journey partnering with this consultant for the next few months?”
When discussing the importance of selecting a search firm with a commitment to diversity and inclusion, Ms. Miller said that this has been a profound shift in the market over the past year. “Most well-managed organizations have turned up the dial dramatically on their insistence on not only a diverse slate, but ideally a diverse hire. Of course this varies from company to company, and by industry segment, but in the areas where we tend to do most of our work, professional services, financial services, not-for-profits, I can’t recall a discussion with a client in the past year that does not include the importance of a diverse candidate slate,” she said. “Of course, since our specialty is senior human resources positions, this could be more prevalent for us than for firms who focus on other functional areas. The important qualification to look for in screening a search firm is first, are they going to make diversity a priority on the search, go the extra distance and dig deeper even though it requires a lot more time and work? And second, are they going to get BIPOC candidates to respond to their outreach in this highly competitive market? A positive reputation among diverse candidates is essential.”
“Time to fill used to be a common metric organizations would use in evaluating search firms,” Ms. Miller said. “In recent years, savvy clients have focused more on other factors such as the quality and thoroughness of the search process, and the track record of the candidate after joining. Most smart clients would make the trade-off of waiting a few more weeks or even months to hold out for a better outcome. Of course, there could be certain circumstances where speed actually is critical, such as a role that is vacant with no one qualified or available to cover it on an interim basis, or an event-driven urgency, for example, needing the executive on board in time for an IPO window.”
Adjustments Being Made
“In Ireland, the country is set to embark on a gradual reopening from May 10,” said Pat O’Donnell, co-founder and managing partner of Principal Connections. “If we can avoid a fourth wave of the virus, which is questionable, as 75 percent of adults are still not vaccinated, I believe that we will see an incremental recovery take place around Q3. Of course, economic recovery hinges on a combination of factors but aptly the Irish Government is set to publish its National Economic Recovery Plan next month. This will show the vision for what the post-Covid economy in Ireland will look like and importantly how businesses and employees will be supported.”
“The biggest adjustment that we have made has been to ensure that we do everything we can to support clients and help them to navigate through the ebbs and flows of managing all their executive search and human capital requirements virtually,” Mr. O’Donnell said. “Of course, it’s an art, as well as a science. One point that we give particular attention to is how we recreate the in-person meetings, online in a video setting. We decided to increase client touch points, and developed a virtual relationship management strategy, as well as a virtual talent acquisition and retention strategy for our clients that outlined how to adapt behavior, actions and processes to ensure that we would all be successful utilizing a full-blown digital approach to talent management.”
“COVID-19 has caused disruption, innovation and transformation across most major sectors worldwide,” said Mr. O’Donnell. “Pre-pandemic strategic plans and operating models became redundant overnight. Thus, businesses that have since reconfigured and redefined operating practices and processes to continue their activities despite the adverse realities imposed by COVID-19 will soon come out the other side of the pandemic with a much-enhanced tool kit. There is no doubt that where such newly adopted practices and processes have secured better outcomes they will certainly be retained and possibly further evolved.”
Related: 12 Reasons Why Companies Hire Executive Search Firms
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media
