December 21, 2018 – Looking back through more than a thousand recruiting stories published over the course of 2018, picking the 10 most important was no small job. Hunt Scanlon Media tracked every little change, every small movement and, above all, lots of big progress.
Truth be told, our choices for this year are a beacon for what lies ahead in 2019 and beyond.
This year, after all, was a year of change, innovation and transition. Expect more of the same in the months ahead.
Broadly speaking, happy days were here again for executive recruitment in 2018. The story most everyone was watching, living and enjoying was how the industry hummed along all year, once more accruing billions in revenues, a far cry from the gloom of the Great Recession a decade ago. It was also a year for the continuation of transformational shifts in the search industry, shown best in our coverage of the rise of artificial intelligence; the talent shortage, with its looming effect on the global economy and its particular impact on the private equity sector; and the European Union’s new privacy laws.
One shift that is coming too slowly is the rise of women to top management roles. We brought you the studies that showed some of the discouraging statistics, as well as the bright spots, like Jill Ader’s ascension to the chair position at Egon Zehnder.
As always, individual companies reinvented themselves in all sorts of ways in 2018. London-based TritonExec’s expansion of its private equity practice to the U.S., as we reported, is part and parcel of a bigger trend of U.K. firms coming to America in the face of the uncertainty of Brexit. And OMERS $1.1 billion acquisition of Alexander Mann Solutions speaks of private equity’s growing role in recruitment.
For all the changes, trends and machinations, however, executive search remains a people industry. And it’s fitting that one of our top stories of the year was a remembrance of one of the best in the business, Gerry Roche, who died this year at 87. Over the course of his career, he placed some of the top corporate leaders in America, and reminded us all of the tremendous impact that one person, one recruiter, can have on our world.
It was no small challenge to pick the top 10 stories of this exciting year. But here they are, setting the stage for the future. Thank you all for your loyalty and trust. We’ll see you back here Jan. 2. Until then, Happy New Year!
The executive search industry’s leading 50 players in the Americas once again surpassed $3 billion in revenues last year, according to recent statistics collected by Hunt Scanlon Media. The group collectively jumped by near double digits, continuing a spectacular run for an industry that just a decade ago was left reeling from the Great Recession. Since then, of course, a host of gravitational forces has tugged at the search sector. Back in 2008 it was LinkedIn making its presence felt; now it seems to be all about AI. Hunt Scanlon Media reports that while the top-end recruitment sector has been in transition for several years, it is about to enter a new phase of evolution. Adapting to the ubiquitous presence of AI and automated technologies will produce clear, and a few unexpected, winners.
Gerard R. Roche, one of the most recognizable names in the long history of executive search, has died at the age of 87. Mr. Roche placed hundreds of top CEOs, board members and other senior executives over a storied career spanning more than half a century. Along the way, he changed the course and trajectory of business history. His 1983 recruitment of John Sculley from PepsiCo to the CEO post at Apple helped establish a new business standard: that skills honed in one industry can adapt, and even thrive, in another. “Today, skills transferability seems so basic; but three and a half decades ago it was hailed as fresh and innovative thinking,” said Scott A. Scanlon, founding chairman and CEO of Hunt Scanlon Media. “Kodak, Goodyear, Chubb, AT&T, Coca-Cola and Walt Disney are just some of the world’s marquee companies that came to rely on Gerry’s talents to find new chief executives – and with them, new direction and enhanced competitive advantage. Even the National Football League tapped him to find its new commissioner at a time when sports teams rarely went to the outside for staffing help,” said Mr. Scanlon.
According to a coming research report from Hunt Scanlon Media, the private equity sector can expect to see an expanding bidding war for top talent. Driving the trend: persistent global talent shortages across the C-suite. Nearly every industry and function is affected, including finance, healthcare and biotech, digital and technology, among others. “Leadership is the new bottom line for private equity operating executives seeking top talent for their portfolio businesses,” said Scott A. Scanlon, the firm’s founding chairman and CEO. “The PE sector is in the crosshairs of a widening war for leadership.” To help find solutions to the growing talent problem, Hunt Scanlon Media is convening 300 private equity leaders, chief talent officers and executive recruiters next spring to further explore the topic of “Private Equity Recruiting: Linking Talent to Value.”
Artificial intelligence is transforming the face of workforces around the world. For executive recruiters and human resources departments, it has meant a growing number of new, specialized roles to fill and untapped talent to discover. Gartner, the information technology research firm, says that on one hand, AI will cause millions of jobs to fall by the wayside, especially low-to-mid-level positions. But in the long run, AI will create jobs at every level, including highly skilled management positions. By 2020, says Gartner, AI will produce more jobs than it eliminates, with a net gain of two million new jobs in 2025. AI is also enabling search firms to find and evaluate talent with greater accuracy and speed.
OMERS Private Equity, the private equity investment arm of Ontario-headquartered OMERS, entered into an agreement with New Mountain Capital to acquire Alexander Mann Solutions, a London-based talent acquisition and management services firm, for $1.1 billion. Alexander Mann Solutions has industry expertise in a number of sectors, specifically retail and financial services; investment banking and professional services; technology and media; defense, engineering and business services; energy; and healthcare and life sciences. The company helps clients, typically large international businesses, to recruit and retain talent through multi-year contracts. Its small army of 4,000 talent acquisition and management experts deliver solutions in partnership with over 100 clients across 85 countries. Alexander Mann is led by founder and CEO Rosaleen Blair.
By 2030, demand for skilled workers will outstrip supply, resulting in a global talent shortage of more than 85.2 million people, according to a newly released report by Korn Ferry. The study found that left to run its course, the shortage will result in nearly $8.5 trillion in unrealized revenue in the economies analyzed. The eye-opening figures are the latest in Korn Ferry’s multiyear “Future of Work” series, which describes a looming and unexpected talent shortage across industries and continents. This most recent report, “Future of Work: The Global Talent Crunch,” examined talent supply and demand in 20 economies across the world in three broad industries: finance/ business services, technology/ media/ telecommunications, and manufacturing. Projections were based on forecasts from international labor organizations and government statistics and then analyzed by outside economists.
According to a just-released report from Boyden, 63 percent of C-suite and executive participants in German-speaking Europe, 75 percent in the Nordic region and 86 percent in Southern Europe report that access to top management roles is more difficult for women than for men. No surprise there. In the U.K., however, only 38.5 percent of participants see access as more difficult for female executives. This imbalance, coupled with challenging social and business environments, prompts the image of a “female Sisyphus,” says Boyden, forever pushing a boulder uphill. In its report, Boyden called upon business leaders to create a cultural environment and management style that enhances the performance of their organization by leveraging diverse talent, particularly aspiring female leaders. The research underpinning this call to action is part of Boyden’s global campaign to #DisruptTheNorm.
Aside from the big-branded executive recruiters, all of whom devote significant time and manpower to talent acquisition initiatives throughout the PE space, a number boutique search firms are working alongside these investment brands to provide talent up and down the functional scale. And much of the activity is taking place on American shores. Following that demand, London-headquartered executive search firm TritonExec expanded its private equity practice into the U.S. by opening new offices in Atlanta and New York. The U.S. expansion will be led by partner Abe Doctor. The firm noted that its private equity practice has been the fastest growing segment of TritonExec’s business. “The $12 million turnover business, which is focused on digital and professional services and private equity, is also expanding its global headcount from the current team of 25 to 40 over the next year,” the firm said.
Executive recruitment firm Egon Zehnder elected Jill Ader as its new chair. She will took over on Nov. 1 upon the retirement of Damien O’Brien who has chaired the firm since 2010. Ms. Ader became the first female chair within the global top five executive search and leadership advisory firms. “Jill is exceptionally well suited to guide our continued global growth and service innovation while retaining our ‘One Firm’ focus on our clients,” said Mr. O’Brien. “She embodies the generosity of spirit that has underpinned the success of Egon Zehnder combined with the deep trust of our clients to support their leadership journeys.” Based in London, Ms. Ader was a senior partner and director of the Egon Zehnder’s board. Since joining the firm in 1996, she has held a number of leadership roles including as London office leader and as a member of both the executive committee and the board.
The European Union’s General Data Protection Regulation (GDPR) recently went into effect and is expected to have a tremendous impact on executive search firms across the E.U. – including the U.K. – and how they handle personal data. GDPR also affects U.S. recruiting firms and others that collect and process information about individuals living in the E.U., no matter where they are located. For many in the search industry these are uncertain days, with two-thirds of executive recruiting firms concerned they could be exposed to heavy fines under GDPR, according to research released by executive search software platform Invenias. The law, which was passed two years ago, is designed to protect individuals from threats to privacy in this still emerging digital age. GDPR, in a nutshell, brings greater transparency to data privacy and personal information storage through explicit consent. And it allows E.U. citizens access to their personal data that is being held by organizations and, if they wish, to opt out.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Andrew W. Mitchell, Managing Editor – Hunt Scanlon Media