September 18, 2015 – David Clapp is managing partner for CarterBaldwin Executive Search, a boutique search firm based in Atlanta. Mr. Clapp leads an active client portfolio that ranges from Fortune 100 global brands to high-growth PE backed companies. His clients are predominantly focused in the distribution, technology, consumer products and professional services sectors.
In the following interview, Mr. Clapp discuses a range of issues including competing with larger recruiting rivals, the industry’s continual shift to broader deliverables and the expanding trend by companies to use in-house recruiting teams to identify and recruit their next generation of talent.
Hunt Scanlon Media ranked your firm right in the middle of its rankings this year, at No. 36. How do you define your firm: a mid-sized generalist or a specialized boutique firm with selected practice areas?
While we certainly have some distinct practice areas that have grown out of our partners’ individual backgrounds and experience, we are definitely a generalist search firm. That said, I don’t focus on defining us on a generalist to specific continuum. We believe our size, resource model and partnering approach is what has fueled our growth. We are also ridiculously process-oriented which brings heightened predictability and visibility into our searches. I truly believe that too big and too small puts limitations on a search firm’s ability to deliver exceptional client outcomes. We are constantly hearing from clients that they are moving more and more of their work to ‘mid-market’ sized search firms. For that reason, we work hard as a partner team to manage our growth, and our team, so that we just get better and better vs. bigger and bigger.
What’s it like being your size and competing with brand name generalist rivals Korn Ferry and Spencer Stuart? Specifically, what happens at core-branded organizations like the Fortune 500 – are the boutiques servicing their C-level talent needs?
We compete with the largest search firms all the time, but you are right – we, and our other boutique brethren — are not getting the F500 CEO assignment calls. Over time I think it’s likely that mid-sized search firms will become a more significant force in the F500 CEO search market as that segment continues to embrace the ‘boutique’ firm, but I would not begin to predict when that might happen. From our standpoint, our core business has always been building out the core management teams for mid-market and F500 companies. We also do a significant amount of mid-market CEO searches. Frankly, I think these searches require more work than the big CEO projects because they are less ‘public’ and need more research, more hustle, and a more intensive vetting process. Search firms often tout their CEO and board practices as the reason they’re special. I think that’s great for them, but we’re very proud of our ability roll up our sleeves and build great management teams. We love this part of the market, and are very focused on having that continue to be our core.
There is a debate raging today as to whether search firms should serve their clients as pure-play recruiters vs offering ancillary services. Your thoughts?
We don’t cloud what we do … we are search and pure search only. Our clients span Fortune 50 global MNC’s, pre-revenue start-ups, universities and large non-profits. I try to follow the market in determining our strategy, and I don’t see the market or our clients wanting us to veer from our core deliverable which is identifying management talent. We’ve had clients from time to time ask if we can help them with a special board assignment or some market data, and if we can help we do and consider these ‘value-adds’ to be part of serving clients. If finalist candidate assessments or industrial psychology interviews are helpful to a client then we will partner with them in getting that done, but only do so if it serves the greater goal of a well-completed search. As a partner team we’ve talked about adding adjacent services but we are all completely aligned that our investments will continue to go toward becoming better and better at our core business of executive search.
Hunt Scanlon estimates that half a billion dollars in search fees are being lost to in-house recruiting programs. Are you concerned about what the long-term ramifications of this might be?
We have a number of clients that have built in-house teams, so I definitely see the trend. I am not overly concerned about it though. My clients have been very clear with me that they will continue to need ‘go-to’ search partners to complement their in-house teams. To be sure, the searches we’ve been awarded by clients with expanded in-house teams are becoming more and more challenging. We will often get a search after the in-house group has made a few passes but was unsuccessful. We love those searches; they make us better and they cement us as the ‘go-to’ search partner for these clients. Moreover, I think this trend has been somewhat offset by the broader trend toward medium sized boutiques that provide high partner involvement and significant research and recruiting support behind them. I’m really thankful where we sit in the market and the fact that CarterBaldwin has continued to grow at the same time client companies are building in-house teams.
How did your professional experience with Coca-Cola and Thomson Reuters prepare you for this career?
They definitely gave me lots of experience on the client’s side of the desk. I think it’s easy to focus on job descriptions and the functional elements of a role, but at the end of the day, every senior placement has a set of business results tied to it. Having lived on the client side has given me a real sensitivity to the business, economic and cultural performance clients are after in every placement. When I conduct a search I think I’m able to really relate to my client and to move pretty quickly to the harder questions around, ‘Can this person get done what my client needs them to? Do they fit? Will they move the team and the company forward?’ Certainly, my years in marketing for Coca-Cola and as a senior executive at Thomson Reuters were foundational for me. I was also fortunate to get some great experience selling for Xerox out of college and to have built and sold a technology company to Thomson. Another big driver for me was my dad … he was a partner for Spencer Stuart and then built a very successful search firm on his own. He retired from Heidrick. My guardian and a huge family friend growing up ran Russell Reynolds as well. I think search was bound to be in my future and in hindsight I really knew that even in my 20’s and 30’s. I love this business.
Contributed by Scott A. Scanlon, Editor-in-Chief, Hunt Scanlon Media