December 23, 2013 – Being a true market master in executive search is critical to the success of any firm whose consultants must understand the complicated landscape in which they work. Top professionals must possess a full working knowledge of specific industries or functional disciplines which allow them to work as effectively as possible with their corporate counterparts to turn in the best results when searching for key talent. In the following interview, Jeff Kaye, chairman and CEO of Kaye/Bassman-Sanford Rose Associates, the 11th largest U.S./Americas firm as ranked by Hunt Scanlon Media in 2013, discusses this issue at length and what is required to be a true recruiting specialist.
Graduating from the University of Texas at Austin, Mr. Kaye has spent his entire career in the executive search industry which now spans over two decades. He is considered an industry expert in executive, professional and technical search and has appeared on CNN, FOX, Bloomberg, NBC and is quoted regularly in the major media including USA Today, The Wall Street Journal, Businessweek and Time and is a frequent speaker within the staffing and human resource community. Mr. Kaye has also been featured in dozens of international training meetings, articles, books and videos.
ESR: Jeff, how do you define ‘market mastery’ and why is this concept so important for today’s recruiters to grasp?
Kaye: For over three decades Kaye/Bassman has relied on the concept of specialization. This was refined over the years into what we now call ‘market mastery.’ Kaye/Bassman pioneered and trade-marked the concept known as ‘client focused search’ which simply means that we can customize our search process, the client relationship and even financial agreements around the unique needs of any given client and/or search assignment. The fusion of these two methodologies allowed KBIC to become one of the largest single site search firms in the world. This success was the catalyst for forming
Next Level Recruiting Training six years ago, which we founded to elevate the competencies and capabilities of search professionals around the globe and, as a result, our industry’s reputation. We develop our own programs, but believe in the concept of abundance and therefore we did not want learning to be about one person or one approach. We aligned with dozens of recruiting trainers and top performers who shared that vision and, as a result, Next Level Exchange has become the world’s largest recruitment training organization with over 1,000 recruiting firm clients in over 30 countries. In 2011, Sanford Rose Associates asked us to conduct their annual conference and provide training for their network. The conference was an incredible success with tremendous chemistry, and we saw that combining their tenured professionals with our resources gave us the opportunity to be an industry game-changer. We acquired the Sanford Rose network in January 2012 and were thrilled that after only one full year we were awarded FBR’s Top Network of 2012 – the only executive search firm to receive the award. While we have won awards for being the No. 1 place to work, for workplace flexibility and for philanthropy, the success of our firm can be rooted in the foundation of market mastery. This is more than simply specializing in an area; it is about becoming a true market insider and active participant within a specific space in the market. Likewise, it is my personal responsibility to be an expert in our space so I can serve my clients (the search professionals at KBIC and Sanford Rose) so that they in turn can serve their external clients. Next Level is about being that market master for search best practices for our industry. KBIC – Sanford Rose Associates is about being that in the niches and markets of each our search professionals.
ESR: What functions and industries does Kaye/Bassman – Sanford Rose specialize in?
Kaye: We believe in being true market masters utilizing our F.I.L.L. model which means each practice is structured with the right combination of function, industry, location and level specialists. We serve nearly three dozen industries or functional practices. These range from construction, chemicals, energy, financial services, healthcare and life sciences as industry practices to areas like HR, legal and supply chain in the functional areas.
ESR: How critical is it for recruiters to be active participants in the areas in which they specialize?
Kaye: It is essential. Let me use a surgeon as an example. Today, we expect our surgeons to have a medical degree, but we also want to know that they are not only a surgeon but an orthopedic surgeon – and perhaps one who only operates on shoulders with an emphasis on rotator cuffs! This level of specialization, for a search professional, allows us to be true consultants who can offer insights not available to clients from any other source. A true market master can not only identify the right targets in the market much faster but knows things like client and candidate reputation, cultural nuances, comparative structures, compensation and benefits intelligence and other competitive positions in the marketplace. Imagine that each practice is a chess board and it is up to the team to know where all the pieces are, what the pieces are made of, and what the best moves are now and several moves later.
ESR: Do the nuances of specialization differ between industry and functional discipline?
Kaye: Yes. The importance is finding the right combination and frequently it is even a combination of the two. For example, imagine three search practitioners. One specializes in healthcare who conducts clinical searches which includes physicians. The second works in life sciences and works in all R+D areas which also includes physicians. On the surface one may say they are specialists, and they are – to an extent. However, what if the third person only conducts searches for physicians working for pharmaceutical companies who oversee clinical trials? And that those physicians all have an emphasis in oncology (cancer) and CNS (psychology) areas. Now, if you are the hiring manager at a small biotech company and have a promising drug in the oncology area and need to find the best talent who has experience in this area, do you want the recruiter who knows every company and every physician who works in that area or the recruiter who has to spend a month building a search plan that would take the specialist a matter of hours to do? This same philosophy can be applied to any industry or function.
ESR: Using healthcare as an example, which is a very broadly defined industry, how detailed do recruiters need to be as specialists? Do they need to be proficient in every sub-segment of healthcare or should they be more generalist in the overall industry?
Kaye: We believe that a practice should ideally cover the totality of the industry but that the team will have a dedicated specialist in each area. For example, in healthcare we have specialists in executive administration, finance, information technology, nurse management, pharmacy, physicians, and therapy to list a few. Many of these functions have several people that further specialize within a specific geography or by type of facility such as acute care or surgical centers.
ESR: Do recruiters who specialize in a certain area handcuff themselves if those areas are not performing well? And what do they do when there is little to no activity during an economic downturn, for example?
Kaye: That is a great question and the answer may be counterintuitive, but it is the exact opposite to what you might think. As an example, construction went through some very challenging periods recently and the sector remains challenging to some extent. In the robust times of the mid-2000’s construction company needs were so strong that companies in that sector would use many search firms. As the market tightened and the pendulum swung from a candidate-driven to an employer-driven market, the needs shrunk. Weak players exited. The deepest specialists secured a larger percentage of a shrinking market and perhaps widened their focus. Show me the search professional in construction or banking or other similar industries who survived the down times, or even thrived through them, and I will show you a market master.
ESR: As industry specialists do recruiters run the risk of recycling candidates or can they replenish the talent pool enough to keep it fresh?
Kaye: Recyclability of candidates is actually a great thing for the search professional, the candidate and the client. The fact that a candidate has been recruited previously does not make the candidate “used.” They are not like milk that goes bad after a certain sell-by date but more like wine that will get better with time. Consider an insurance brokerage firm wanting to bring a big producer in with a large book of business in a specific market segment. The assumption would be that they want to recruit the best person in that segment. If a recruiter has done that search several times over the past few years then he or she will have knowledge of that market. Perhaps that recruiter knows all the possible people in that market, their compensation levels, the challenges they faced in the past and their motivations for considering job change. The candidate benefits as the search professional won’t be wasting their time with inappropriate questions; the client benefits from the recruiter’s history of knowledge and market expertise; and the search professional benefits as the search can be executed more thoroughly and expeditiously.
ESR: Specialists tend to work with a myriad of client companies in one industry. Where does off-limits come into play here and how do these specialists deal with that as a potential issue if part of that industry is off-limits to them for talent?
Kaye: This is perhaps the greatest challenge for a true market master. It is why establishing long term relationships with a few growing organizations is essential for the specialist search practitioner. Having multiple searches with a few companies is the best protocol so that the vast majority of the market is not hands off. It is only a problem for transactional search practitioners with little repeat business.
ESR: Our recent State of the Industry report revealed that companies today prefer to work with boutique recruiting specialists. Have you seen this as a trend at your firm and why do you think clients prefer working with smaller, more specialized recruiters?
Kaye: This has been one of our mantras for several decades. We believe companies want the full service capabilities of a proven global recruiting brand, with a proven recruiting specialist in any area of need. Companies would also rather have us turn them down than let them down. There is a fallacy that a recruiting firm has to be able to handle every search or they are not client focused. If your law firm can handle most any issue you have, but perhaps not estate planning, for example, the fact that they refer you elsewhere does not make them bad. It reinforces why they are so good at what they do and why they are your trusted partner who won’t take on something where they cannot deliver superior results. Kleenex, Xerox, and Jell-O are all brands but their brands have become synonymous with tissues, photocopiers and gelatin. Every search specialist should seek to become known as the brand of their market and every search firm should strive to become the brand of the collection of those specialists.