February 8, 2018 – London-based human capital consultancy ALC has launched a new advisory firm designed to help hiring organizations build their own in-house executive search function.
“There has been a definite trend over the last few years toward hiring organizations building their own in-house executive search functions in order to achieve substantial cost savings,” said Tim Connolly, founder of ALC. “The challenge, though, is setting the right strategy and then deploying the operation to underpin it.” Unfortunately, he said, too many companies have made the mistake of passing the recruiting baton to lower and mid-level resourcing functions. But that’s changing. Call it another benefit of advancing technology.
ALC has over 16 years of experience in the executive recruitment sector. The firm has a global network of recruiting consultants and firsthand knowhow in establishing and running executive search functions across sectors, geographies and cultures. The firm sees its new offering as an ideal extension of its present business offerings.
ALC is in the midst of forming an advisory board to help it think through and position itself in the market. Already included in its ranks are James Gardner, former executive search lead at Dixons Carphone, and Ben Barratt who formerly led and developed Alexander Mann’s executive talent solutions business within financial services. He is now director of TMC Search.
Building Talent Pipelines
“We always knew that this golden access to talent could well be dynamite for hiring organizations looking to achieve cost savings and efficiencies,” said Mr. Connolly. “But it’s not just about the talent – it’s about building a high performing function which leverages an organization’s brand, culture and values. Our global associate network now numbers over 100, and we have a strong team that has undertaken this sort of advisory work before – and who have themselves been heads of executive search – and so we are well equipped to be pioneers in this market.”
Mr. Connolly recently sat down with Hunt Scanlon Media to discuss the new service and to explain why more companies are building in-house executive search teams – and it’s not just to save money.
Tim, we’ve been tracking in-house recruiting developments for several years now as you know. What led to the creation of your new advisory firm – and why now?
The sheer massive opportunity of it! Nobody else is doing this and there seems to be an increasing demand for it. From our research, there is an expanding, and real, need for supplying advisory and consulting services around setting up in-house executive search functions for corporates. We are fortunate enough to have an extensive network in the executive search industry going back 17 years, and we talk to recruiting consultants at all levels every day; that’s what we do. Now, armed with an advisory board that has experience of setting up corporate executive search functions, we are uniquely placed to assist companies wishing to take the plunge and make these cost savings, or at least help them to look very closely at the option. I love the fact that in our extensive market research everybody, bar nobody, has been really excited by it.
What are some difficulties companies might face in launching and establishing an in-house search team?
There’s a cultural tension between HR and executive search. And so that has to be addressed up front. Bringing executive search in-house is not as easy as it sounds and inevitably mistakes are often made. From the 140 corporate TA professionals we have spoken to so far, there seems to be a real demand for helping them to get it right the first time. Anytime that anyone brings in a radical new cost savings idea to a business, there is a tendency to focus on the end goal without necessarily looking at the best steps to achieve that end.
“The benefits (of bringing the recruiting function in-house) are cost, control, visibility and transparency of the executive search process. The cost savings are huge, often millions, but it’s not an easy transition to make, which is why some corporate hiring professionals still haven’t done it.”
Explain how this will work, Tim?
First of all, we offer a strategic review of how an organization currently hires their most senior people and we conduct a cost savings analysis. Often corporate hiring professionals don’t even know exactly how much they’re spending on search fees per annum. As we’ve worked with search firms around the world for 17 years, we can also assist them with managing their current relationships better or more cost-effectively. Most companies still wish to keep at least some of their external relationships with headhunters, sometimes with good reasons, and so we can help them rationalize these. In our strategic review process, we give examples of how other companies have realized their savings and how they have set up their executive search functions in-house. These ‘case studies,’ if you will, really help.
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Talk a little more about the review process.
Let me say that we begin our review by providing a cost savings analysis and examining options of modifying relationships with existing executive search providers. We supply case studies from ALC’s previous work. Then we provide examples of some of the cultural challenges of bringing executive search in-house and how we can assist in overcoming them. ALC will then review common mistakes made and how to overcome them. We also examine whether there is mileage in upskilling some of the current team. ALC also reviews the consideration of a consultant coming in to integrate and assist in the transition of bringing in an executive search team. We also look at interim as well as permanent solutions in terms of staffing. It is a full review, up and down the organization’s hiring structure.
What comes next after the strategic review?
After the review we come up with a proposal for the client in terms of what we feel they need from an advisory and staffing point of view. We then go ahead and implement. ALC provides a consultant on-site to work closely with the client in terms of preparing the infrastructure, looking at the culture and establishing the processes for integrating an executive search in-house function. We then identify exact needs in terms of the size and make-up of the team required. We then hire them. Working very closely with the corporate hiring professional, we assist in their on-boarding and integration from a process and cultural/political point of view, either with our performance management business ALC Discovery, which includes assessment profiling, or through other means.
What’s the primary benefit for organizations?
The benefits are cost, control, visibility and transparency of the executive search process. The cost savings are huge, often millions, but it’s not an easy transition to make, which is why some corporate hiring professionals still haven’t done it. Very simply, they’ve never had executive search in-house before and in some ways it can be regarded with suspicion and there can be political and cultural challenges in bringing this function inside the organization. For example, the head of in-house executive search may be earning something similar to some of the most senior HR executives and this isn’t always easy to swallow.
How do you think this will impact the top-end recruiting sector?
I think the smart executive search firms have been demonstrating agility for the last few years in preparing themselves for this trend by adding services outside traditional search to their repertoire. These have included performance management solutions, including assessment, as well as talent pipelining, competitor intelligence and a myriad of other solutions. A senior ‘search’ managing partner from a tier one firm told me that 50 percent of his own personal revenue is non-search. He and his firm are coping well, but others are faring less well. Corporate hiring executives still need external search firms, this isn’t in question. They’ll need that third party for some of the more confidential searches, or perhaps for some of the more truly intricate and difficult ones. And, of course, external search consultants offer great value acting as brand ambassadors for their clients – flying the flag, as it were.
Tim, are you seeing more executive recruiters leave their firms in order to join corporate in-house search teams?
It’s happening more and more, particularly in the U.S. and the U.K. – two of the largest markets for recruiting. Other countries have been slower off the mark but it’s starting to happen more in Germany, France and the Middle East, for example. Interestingly, some move from the search sector into the corporate environment and then back again as the reality of cultural and political clashes sinks in. But in-house recruiting is creating a very healthy career alternative for executive search consultants, no question. As long as the transition is managed carefully by the company and the shift isn’t underestimated by both parties, it can be a very successful career move.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Will Schatz, Managing Editor – Hunt Scanlon Media