Inside! An Exclusive Interview with Gerry Roche - page 10
Search The Global Executive Talent Quarterly from the AESC Spring 2014
Friend or Foe? Is LinkedIn a threat to retained search? Inside: The Client Speaks Report
President’s Letter
A Message from Peter Felix, AESC & BlueSteps President
I
am delighted to introduce the AESC’s new quarterly Search, the reincarnation of our high end glossy print magazine last published in 2000. Its convenient electronic format not only makes it easy to read but allows us to develop material that can easily be enhanced by links to dynamic content online. I hope that you will enjoy it but also contribute to it via letters, articles and research. In many ways retained executive search today stands at a crossroads. Its glory days are by no means over but it is facing a less comfortable existence than in prior times. Forces are at work that are exerting pressures on retained search to provide excellence at the very top of the organizational tree but not encouraging us to perform lower level assignments. This is reflected in our industry statistics for 2013 that
show a continued slow decline in the number of assignments but a clear increase in revenue and thus the value of each consulting assignment. Purists might say this is as it should be. Retained search was never intended to be a volume business. It should be used strategically but also tactically and even surgically, when appropriate. Our goal in producing this publication is to discuss the important role that retained executive search plays in helping organizations to find and recruit the best talent, of the criteria that should be employed when recruiting top executives and of the qualities of leadership that are required in our fast changing and global world. The fortunes for our industry are looking better in the mature markets of the world as we emerge from recession, even though uncertainty prevails in emerging markets where retained search is still a questioned service. Our Outlook and Client Speaks surveys reviewed in this first edition of
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Search flesh this out in greater detail. Future editions of Search will highlight leadership research, trends in the market and the leading edge activities of our many member firms and consultants, so please do get in touch if you feel that you have a compelling story to tell. I hope that you will enjoy our first edition and provide us with your feedback as we embark on our next exciting step in raising the profile of executive search around the world. With kind regards
The fortunes of our industry are looking better in the mature markets of the world as we emerge from recession
Peter Felix President, Association of Executive Search Consultants and BlueSteps 425 Fifth Avenue, 4th Floor New York, NY 10016 pmf@aesc.org
Search
The Global Executive Talent Quarterly from the AESC Spring 2014, Volume I, Issue I Board of Directors
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Aidan Kennedy, Chair Partner, CTPartners - London Jason Johnson, Vice-Chair Founder & Managing Partner, Johnson - Sydney
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Krista Walochik, Treasurer
President, Norman Broadbent - Madrid
Nairouz Bader, Board Member
Founder & Chief Executive Officer, Vision Executive Search - Dubai
Table of Contents
Robin Balfour, Board Member
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Director, Odgers Berndtson - London
Nikki C. Bondi, Board Member
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Co-Founder & Managing Partner, Advantage Partners - Cleveland
Thomas T. Daniels, Board Member Partner, Spencer Stuart - New York
Anton Derlyatka, Board Member
Senior Partner & Managing Partner of Talent Equity Ventures, Ward Howell - Moscow
Thomas J. Fuller, Board Member
Managing Partner, Epsen Fuller | IMD - New Jersey
James Hickman, Board Member
Managing Director, Russell Reynolds Associates, Inc. - New Delhi
William M. King, Board Member
Chief Operating Officer & Senior Vice President, Korn/Ferry International - Los Angeles
Dinesh Mirchandani, Board Member President, Boyden - Mumbai
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President’s Letter The Client Speaks
The AESC’s biennial study
Outlook Report
Outlook Among Executive Search Consultants Reaches 42-Month High
10 Gerry Roche - “This Works For Me”
Heidrick & Struggles’ main man shares his philosophy on what makes a great search consultant
12 Friend or Foe
Is LinkedIn a threat to Executive Search?
16 Catching Up With Patrick Rooney
Denys Monteiro, Board Member Chief Executive Officer & Partner, Fesa Global Executive Search Transforming Leadership - Sao Paulo
18 Refining Research
Steve Mullinjer, Board Member
20 Annual Report
Regional Managing Partner, Heidrick & Struggles - Chongqing
An interview with Rachel Roche
2013 Search industry revenues up but volume down
Jean-Philippe Saint-Geours, Board Member Partner & Chairman of AltoPartners, Leaders Trust International - Paris
Peter Felix, Ex-officio
President, AESC - New York
Editorial Team President
Editor
Managing Director, Marketing
Senior Designer
Peter Felix Joe Chappell
Ben Ashwell Don Hailer
The Association of Executive Search Consultants www.aesc.org
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Industry Analysis
The Client Speaks T
he latest figures from the International Monetary Fund’s ‘World Economic Outlook’ indicate that the global economy is stabilizing, forecasting a global growth rate of 3.6% in 2014. The theme of economic recovery is echoed in the estimated global revenue of the retained search industry. AESC ‘State of the Executive Search Industry’ figures reveal that during 2012, global revenue reached $9.74 billion, compared to $7.43 billion in
2009. Furthermore, our Q3 statistics for 2013 reveal a year-on-year growth rate of 11.7%. Despite the competitive forces of in-house search departments and contingency firms, there is still a clear market for the services of retained search firms. The AESC’s biennial ‘Client Speaks’ study finds that almost three quarters of survey respondents (73%) believe that their use of retained search will have either increased or stayed the same during 2013,
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compared to 2012. For contingent firms this is lower, at 62%.
Improving relationships with clients
While the findings of the study are broadly positive – especially when placed alongside the recent AESC and BlueSteps Outlook surveys and State of the Industry quarterly statistics – there are also several reasons for retained search firms to sit upright and take notice.
The AESC’s biennial study reveals that Flients are satis¿ed with retained searFh ¿rms while highlighting areas for improvement The first, unsurprisingly, is the continuing emergence of the in-house search function, with 88% of respondents saying that they expect their usage to increase or stay the same. While this is currently only likely to impact on the lower end of the retained search market (the study’s findings indicate that clients are far more likely to use retained search for assignments where the salary is $200,000+), there is clearly a growing level of sophistication in the inhouse search function and with that comes greater trust. For example, according to the
study’s findings, clients are as likely to use an in-house search function for leadership consulting services as they are a retained search firm. The strengthening of in-house search functions has been played down by some as a symptom of an economic environment where client organizations cannot always afford to use a retained search firm. That is apparent in the research, with ‘reduced budget for external services’ being one of the most cited reasons for the increase in the use of in-house search functions. But that is the third most popular response, with ‘increased satisfaction’ and ‘increased demand from within the organization’ finishing as the two most common reasons. So while there is little risk of in-house search functions outmuscling retained firms for the type of senior assignments where retainers are necessary (and, even if they were, there are legitimate questions around whether in-house consultants have the objectivity to handle a sensitive senior search), there is a growing confidence in the service that in-house consultants provide.
Are you really a ‘trusted advisor’?
For the respondents who use retained search less frequently than they once did, there were two strands to their reasoning: a need for more transparency and metrics, and a feeling that in-house search functions have a better understanding of internal talent management policies. The first point is feedback that extends beyond retained search and is being argued across the professional services sector. How can businesses which rely on intellectual property and discretion develop a more client-centric business model that is measurable
The vast majority of respondents (85%) either ‘agree’ or ‘strongly agree’ that they want to build stronger relationships with their retained search partners without compromising the service itself? The respondents to the study indicated that the top two ways that search consultants could improve their service are ‘more transparency regarding process’ and ‘more metrics’. Worryingly, 37% of respondents felt that the price of their last retained search was greater than the value provided, but the same number later admitted that they have no method for measuring return on investment. The vast majority of respondents (85%) either ‘agree’ or ‘strongly agree’ that they want to build stronger relationships with their retained search partners, which is encouraging considering the sentiment from some that in-house consultants have a better understanding of internal talent management policies. Whether clients will continue to rely on in-house consultants in the future remains to be seen, but it is clear that there is an opportunity for retained firms to strengthen relationships with their clients, getting a more granular understanding of the softer HR and talent management strategies at play in an organization to enhance the service they provide. Ultimately, the grass isn’t greener on the other side, but retained search firms shouldn’t be letting their clients find that out themselves. „
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Industry News
Outlook Among Executive Search Consultants 6 | Search - The AESC Quarterly | Spring 2014
T
he 2014 Executive Search Industry Global Outlook Report, by the Association of Executive Search Consultants (AESC), shows that retained search consultants feel more optimistic than they have since July 2011.
Reaches 42-Month High
Retained search consultants and senior executives share optimism for the executive job market in 2014
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Almost two-thirds (64%) of respondents feel positive about the industry for the first six months of 2014, compared to 29% this time last year and 35% in July 2013. One third of respondents (33%) have a neutral outlook for the first half of 2014 meaning that only 3% do not feel positive about the next six months – the lowest percentage of negative responses since the AESC started surveying member outlook in 2008. This industry-wide optimism is even higher when respondents consider the fortunes of their own firms, with 68% holding a positive outlook and 29% with a neutral outlook. Indeed, 63% of those surveyed expect to see an increase in annual revenue for 2014, while only 4% expect their revenue to fall. The remaining 33% expect their revenue to remain consistent. Of those
This industry-wide optimism is even higher when respondents consider the fortunes of their own ÄŞrms with % holding a positive outlook and 29% with a neutral outlook
members who anticipate an increase in revenue, almost half (48%) believe that the increase will be between 1019%. This confidence is likely to affect retained search firms’ hiring plans, as more respondents said they plan to hire more consultants (39%) and researchers (24%) than to maintain the same number of consultants (20%) and researchers (12%). Peter Felix, AESC President, said: “The results of our Outlook survey are most encouraging and indicate that, in spite of continuing volatility in some regions and sectors, nevertheless there is real evidence of organizations thinking more strategically and looking ahead with a positive mindset. Senior management appointments are one of the key focal points as boards and top management evaluate the future and consider whether they have the right people in the right jobs.�
Executive Candidates Feeling Optimistic About Job Market
The positive outlook of AESC members is mirrored by senior executives, as our sister report, the 2014 Global Executive Outlook Report, reveals. The survey of BlueSteps members shows that 51% of senior
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executives worldwide hold a positive outlook for the global executive job market in 2014, an increase of 15% compared to the same time last year. The remaining 36% of senior executives shared a neutral outlook for the year ahead, while only 13% harbored a negative view for this year. Many executives consider themselves mobile again compared to the same time last year, with 74% of executives more willing to make a career move this year compared to 2013. 87% percent of executives plan to look for a new role this year. Felix added: “After five years of moribund compensation growth and cost cutting pressures, many executives will consider themselves to be “mobile� once again and interested in a change of environment and opportunity. Greater economic certainty will encourage them to take career risk and this mobility factor may well usher in a new phase in a War for Talent which has been less visible during the financial crisis.� „
Feature Story
Gerry Roche, Heidrick & Struggles’ main man since the 1960s, shares his philosophy on what makes a great search consultant
“This Works for Me” G
erry Roche is it at dinner with his friends. Not a fan of small talk, he doesn’t want to discuss golf scores, the weather, grandchildren or real estate (“20 minutes of that is ok, but that’s it!”). He wants to get to know the people sitting at his dinner table, beyond their incidentals; he wants to know what really makes them tick. “What do you want to have on your tombstone?” he says, to the surprise of everyone sitting around the table. He proceeds to chair a conversation about epitaphs, but before he gets a chance to say his own, his wife interjects: “I don’t know what my husband is going to say, but I’ll tell you what it should be. ‘I’ve got to make a call.’”. The guests around the table laugh, as does Gerry. She follows with a comment that makes him smile when he retells the story now: “I hope he gets an answer.” But (as he would likely say himself), what is the point of this story? Well it gets to the core of why, after 50 years of filling some of the most high-profile and challenging positions on American boards, he is still working for Heidrick & Struggles. “I wish I didn’t love this job as much as I do,” he says. “I’m 82 years old and I should have retired long ago. But what is more fascinating than trying
to understand the human condition? The human being is an ineffable figure.”
“I am still looking for a better job” Gerry Roche is an elder statesman of what is still a relatively young industry. But, as he tells it, his entry to retained search was accidental. Back in the early ‘60s, Roche was contacted by Gardner Heidrick, co-founder of Heidrick & Struggles, who was trying to fill a position for a client. Roche wasn’t interested but when he turned it down, Heidrick asked him to open a New York office for his growing search business, saying: “You couldn’t be in a better place to look for a new job than in one of my offices.” So began a long and distinguished career at Heidrick & Struggles (despite his jokes that he is still looking for a better job), which included lengthy stints as President and CEO, Chairman, and Senior Chairman. Few have had a larger impact on our industry, or grabbed as many headlines from intrigued business journalists so it is remarkable that, by his own admission, he knew nothing about being a headhunter when he first started out. So what did Gardner Heidrick see in him and, years later, what does Roche look for in his industry peers?
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“Number one: there is no substitute for integrity,” he says passionately. “If you don’t have that, I don’t care what else you have, go do something else. Number two: human sensitivity. You have got to read people. Number three: always take the long-term approach. Avoid short-term expediency because life is a long-term deal.” Roche has a way of making some of the most complicated board searches sound easy, which is partly down to his own passion and enthusiasm, but he regularly returns to these three principles as the cornerstone of great search work. “Good recruiters are not stereotypes,” he says, “except for those traits. Tom Neff, my number one competitor – who I think the world of – is about as different from me as you can get.”
The Tom and Gerry show Roche and Neff (Spencer Stuart’s former President and Chairman) share almost 90 years of search experience between them. Their professional rivalry was labelled ‘The Tom and Gerry Show’ during the 80s and 90s, due in part to the number of high profile searches they were both completing at the time, but also to a difference of working style so
acute that the writers at Warner Brothers would have struggled to create two characters so different. A 2005 profile of the two of them in Fortune magazine wrote: “How does Neff compete against the charismatic Roche, who happens to work in the Park Avenue office tower next door? By being everything that Roche is not–deliberate, methodical, and famously discreet.” Perhaps one of the most significant and infamous CEO searches of all time was for IBM in 1993. The ailing technology giant had just posted an annual loss of $5 billion and John Akers had announced his retirement as Chairman and CEO. Realizing that finding the next leader was critical, IBM’s search committee (which consisted of the whole board) retained Roche and Neff for the assignment. The search committee wanted to maximize the pool of potential candidates and, realizing that both Roche and Neff would have large “off-limits” lists, opted to circumnavigate the issue by retaining both of them. IBM ultimately appointed Lou Gerstner, then CEO and Chairman of RJR Nabisco. Neff had placed Gerstner at RJR Nabisco previously, so it was Roche who was able to capitalize on the opportunity. Under Gerstner’s leadership IBM made a miraculous recovery and recently celebrated its centenary in robust financial health. According to Roche, when he first presented Gerstner to the search committee, James Burke (then Chairman of Johnston & Johnston and head of the IBM search committee) exclaimed: “Roche you are insane!
Gerry Roche on candidates: I am a wild liberal on what I will consider. I am an arch conservative on what I will wind up doing.
You want to put a cookie salesman in a computer company?” This speaks to Roche’s “metaphysical” process of selecting candidates – his own theory of relativity. To illustrate this, he recalls a conversation with a client about a specific candidate:
Roche: What do you think of [candidate’s name]? Client: For what? Roche: What do you mean? Client: Is Derek Jeter [five-time World Series champion with the New York Yankees] a good athlete? Roche: Sure he is. Client: Well he’s one of the best shortstops in the world, but how would he be as a quarterback for the New York Giants?
“I love the complexity” That’s the challenge and I love the complexity,” Roche says. “There’s nothing that I love better than watching somebody hit the long ball in one of the searches I have finished.” Roche explains the reward of great search work can far outweigh the cost of the assignment to the client (as seen from the IBM example), but he also tempers that with caution – referring again to the human element at the center of retained search. He talks about one search that he didn’t get right which, he feels, affected the candidate’s future prospects. “I didn’t do a good job and I still regret it every day,” he says. Like all of the best search consultants, Roche’s work goes beyond aligning a candidate with an organization in the present day; he strives to unlock the potential of an individual and make sure their growth is in line with the future strategy of the client organization. “The number one sin in the world is unfulfilled potential,” he says.
“If you know you can run a company as well as anybody else then let me help you by putting you in a situation that will allow you to blossom. There’s no ending to what one person can do.”
“People call me a hero worshipper – and I am!” Roche is an inherently social being. If you have the good fortune of spending some time with him, you will be likely to acknowledge his charm and charisma. “I ride up in an elevator and I see someone interesting and I want to talk to them,” he says. “What makes them tick? Can they inspire me?”. He gives the impression that he is happy to talk to anyone he encounters, but it is the executives that he has spent his career working with that he relishes talking to the most. “Think of the searches I have done and the people I talk with,” he says. “They’re the best damn people in the world: the Jack Welchs and Lou Gerstners of the world. People call me a hero worshipper – and I am!”. Roche is clearly proud of the work he has done during his career and of the relationships he has maintained throughout his life (he considers himself fortunate to play golf with Jack Welch and despite his aversion to small talk he does discuss golf on the fairway – “Jack, you’ve put your ball down three inches too far forward,” he jokes). You get the impression that he would bite your hand off for another 50 years of board search. So to return to his own dinner party question, what would he have as his epitaph? “I hope I helped the world,” he says, which gets to heart of what really makes him tick.
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Feature Article
Is LinkedIn a credible threat to retained search or has its impact on the industry been overstated?
Friend or Foe?
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case you hadn’t heard, retained executive search is on its last legs. We know this because we have read articles about it, picked up Jo Nesbo’s novel
Headhunters and watched the silver-screen adaptation which shows that lowly
search consultants must supplement their income with a life of high-end crime. It really has got that bad. The logical conclusion to this narrative is rather poetic: the world’s best
retained search consultants will end up refreshing LinkedIn relentlessly until they receive a message with a job offer attached. Indeed, an article by Andrew Hill from The Financial
Times, published in March 2013, announced that headhunters are being hunted and are
soon to join the likes of “travel agents, insurance brokers and bricks-and-mortar retailers� in The Natural History Museum. Much of the argument that retained search is struggling is related to the continued growth of LinkedIn, being a database of more than 238 million names which has more or less fallen into the laps of corporate recruiters. Notable companies such as Time Warner, Microsoft and American Express have all made headlines with their championing of in-house resourcing. And yet, the Association of Executive Search Consultants’ quarter three statistics for 2013 reveal an increase of 11.7% compared to the same period in 2012.
Making a great hire
The development of the internet has changed the world and fractured some industries beyond recognition but there is nothing about it that has changed the nature of the acquisition of senior talent. If anything, the advent of 24-hour news coverage and microblogging has
increased the levels of scrutiny of which organizations are exposed. Therefore, values such as confidentiality, discretion and objectivity are still vitally important to this sensitive process. “There are all sorts of soft factors that go far beyond just finding the candidate,� says Guy de Buttet, senior partner at Heidrick & Struggles. “Part of the value-add that we are able to bring to the table relies on those soft factors. We work with the client to make contact with a candidate in an appropriate way, leading both parties through to the best, most effective and most confidential conclusion.� Assessing the client need (which means more than just asking what they want), evaluating the candidates’ strengths, weaknesses and references and exhibiting the necessary due diligence can be the difference between making a ‘good’ hire and a ‘great’ hire. LinkedIn’s services offer nothing that comes close to this level
of sophistication. Endorsements, recommendations and engagement with company pages may provide some vague information about an individual or organization, but it is largely an unregulated Wild West of crowdsourced recognition (there is nothing
Values such as conÄŞdentiality discretion and objectivity are still vitally important to this sensitive process. to prevent two friends exchanging endorsements for skills they are wholly unqualified for as an attempt to mutually improve their profiles). Brian Toland, executive recruiting director at Microsoft, explains that
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has on LinkedIn can be used as a substitute for a resume, something which causes issues for his team. “LinkedIn has become the de facto repository for people’s experience,” he says. “But very rarely do you find a profile that is a decent substitute for a resume. It puts more work on the recruiter because you really need to be digging out the information that a resume would have covered.”
An ocean of data
I’ve been in search since before the dawn of the internet and I don’t know how we did it back then,” says Joan Schlachter, senior associate at Boardwalk Consulting, jokingly. “I frankly have no idea why LinkedIn is seen as an impediment.” Indeed, all search firms use LinkedIn: some firms use it for original research (in a similar manner to in-house recruiters) and some crossreference the information on their own proprietary databases while drawing up a long list. But it is easier to drown in the ocean than it is in a pond and the more data you have, the more analysis it requires. One of the enduring criticisms of retained executive search is that it can take too long to complete an assignment.
8eT[ TaTeN[ do [ou Īnd a RToĪle that is a decent substitute for a resume. It puts more work on the recruiter because you really need to be digging out the information that a resume would have covered.”
Conversely, the strength of a search firm’s proprietary database, compared to the millions of individuals on LinkedIn, is that the candidates have already been vetted and deemed to be suitable for consideration. If you acknowledge that identifying candidates is only the start of the recruitment process, you realize that oftentimes less is more. While it is an expansive resource, LinkedIn is only one trick in the magician’s hat – something that can be overlooked all too often.
The human touch
From the candidates’ perspective, switching organization, function or country is not to be taken lightly because it represents significant risk. It should not be forgotten that retained executive search is not transactional and is not simply about filling an empty office. Aside from any financial benefits that a candidate may earn from a move, they will be looking for professional development and cultural fit. Ultimately it comes down to audience: how many candidates that would be considered for a senior executive position actively engage with LinkedIn regularly? How many of them would appreciate an informal phone call or
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face-to-face meeting over receiving a LinkedIn message? Maybe there will come a point where a generation of executives prefers to discuss career moves online, but until then you have to engage with your audience in the way that they want. There is no doubt that the rise of social networking benefits both inhouse recruiters and executive search consultants. In some cases this pushes retained search up the value chain as business can be eaten up by cost-cutting HR or purchasing departments. Therefore, this is not a time for complacency and professional standards should continue to be adhered to. But then, these words are as applicable now as they have been at any other point during the 54 years of the Association of Executive Search Consultants. There is never a good time for complacency in business. For organizations, that means having the best talent to define and execute your business strategy. For retained search firms that means identifying that talent and the organizations in which it can be best deployed. So retained executive search consultants can leave their balaclavas, gloves and art history textbooks to collect dust in storage because they have a day job to concentrate on.
Catching Up With...
Patrick Rooney In November the AESC announced the appointment of Patrick Rooney as Managing Director of the APAC region. We caught up with PatricN to ¿nd out what he
Asia Pacific continues to be the most sought-after market for business growth and local talent.
hopes to achieve in his new role
Welcome to the AESC. What experience do you have that qualifies you for your new role? Directly before taking this role I completed a Master’s Degree in Asian and International Studies. It was very focused on economics and politics in East Asia and South East Asia. It gave an insight into the markets and the government control in places like Korea and Japan. It will be useful for this role because it can help explain how some of the markets we operate in work behind the scenes. Before that I was with Academic Search International for six years. They are an AESC member firm that mainly deals with senior academic positions – for example research chairs and directors of research. The academic space has some very interesting searches. Clients only use you for the things they can’t
fill themselves or for those se areas that are incredibly ly difficult to fill. Early on in my career I was also President of the New w Zealand University Students’ Association, which is also useful for this role because it is an organization where you don’t directly represent members, but you represent their interests. What interested you about ut this position with the AESC? ? APAC and the Middle East st is still a relatively new region on for executive search – it really ly needs an organization like the he AESC to help guide it and nd make sure that what comes es out is a high quality, well ell respected profession that can an deliver results and is driven en to achieve those results. The he risk is that it could end up as sort of a low quality profession on that is actually trying to deliver er low cost options for clients. s. There needs to be some me
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education about the benefits edu of retained search to o clients and the disastrous c consequences of making c bad b hires. The time is right for f the AESC to grow and to increase the intensity of our ou presence in the region. When Whe you’re not at work, how do you like to spend your time? time I love travel – that is one of the reasons that I live in Hong Kong Kon because you can visit a lot o of places. I have been ticking off a lot of UNESCO heritage sites around the region. Also, Hong Hon Kong isn’t what people expect. The images you see exp are usually of densely packed tall buildings but 70% of Hong Kong Kon is parks, forests and mountains. Most weekends I mou do a hike along a different part of o one of the Hong Kong trails. There The are some quite amazing views view and beaches where you think thin you could be in Southern Philippines or Thailand. Phil
AESC Certification
4GĪPKPI 4GUGCTEJ Rachel Roche has spent the last 20 years combining two of her passions: education and executive search. She is the founder of Smart Search, a consultancy which specializes in the training of executive search professionals and is dedicated to helping search professionals “learn the science and the art of recruitment”.
You have spent your career either working in recruitment or training recruiters and researchers. What is it about the process of senior level talent acquisition that gets you excited? It boils down to a few things. The first is the strategy and problem solving element. Every new search is a blank slate. What drives me crazy about search professionals is when they say ‘I always do it this way’. You have to address each assignment uniquely and flex your professional muscles. Clients deserve that. I also really like the tactical part of reaching the unreachable executive by describing the opportunity in a way that makes someone really listen and engage. I love all those situations. That said, the teaching is the most important and satisfying part of what I do. There is no university course in retained executive search for researchers so we all come to it clean and untrained. I love offering people who are new to search a forum and a way to make them think about it differently, to ultimately elevate their professionalism and pride in what they do.
In your opinion, what is the role of a researcher in a retained executive search firm? The role of the researcher completely depends on the firm. In some firms a researcher is a person who, given a mandate by a client, identifies a list of potential candidates. In other firms a researcher does that and is also the first person on the phone, asking for referrals and turning over the list of qualified individuals. And in other firms the process for the researcher continues and can include face-to-face interviewing, meeting with the client, reference checks and marshaling the candidate through the interview process. Whenever I talk to a search firm, my first question is to ask them to define what the researchers do in their firm. Do you feel that there is an understanding from clients about the value of retained search? Clients do value retained search, especially when they view their search firm as a real partner in talent acquisition, rather than a service bureau where they go to pluck a
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great hire. Clients are using search much more selectively than they were five years ago and their expectations are much higher. When a client hires a search firm it is a bigger deal than it used to be and requires a lot more relationship building than ever before. You have worked with the AESC for a number of years on its Campus programs for researchers. What value do you feel they provide? The value of the courses is that they are specific to retained search. They are interactive and provide an opportunity to learn from peers at other firms. It’s a safe, positive environment. People come away having validated the things they do already and collected a range of new ideas. To be a certified researcher is a big deal. It means that you have really gone through a lot of courses, time and effort and come away with a body of knowledge that is unique to retained search. It is very exciting to see that the search firm partners of the future have this opportunity to get grounded in search early on. I love that!
2013
2013 Search Industry Revenues Up But Volume Down Report shows growth in retained executive search and leadership consulting revenues, but a declining number of assignments
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Annual executive search and leadership consulting industry trend data, just released by the Association of Executive Search Consultants (AESC), revealed an 8.5% rise in global revenues over 2012, placing estimated 2013 industry revenues at $10.57 billion worldwide. The 2013 annual revenue increase comes despite an 8.5% drop in the number of new searches started in 2013 over 2012. Revenue strength is instead attributable to continued growth in the value of individual assignments, up 6.1% annually in 2013, highlighting demand at the top-end of the executive search and leadership consulting profession. AESC President, Peter Felix, commented: “2013 has confirmed a trend that we have seen growing for the past several years, which is that client organizations are turning to our member firms for top level leadership assignments but less for the volume appointments of the past. Encouragingly this has not affected fee revenue which is now again very close to the all time high of 2008. With the rebound of major economies for executive search such as the USA and United Kingdom the outlook for our profession during the next few years seems very positive”. On a regional level, North America remained the largest market for executive search in 2013 holding a 44.8% share of global search activity, followed by EMEA, which accounted for 31.5% of retained executive searches in 2013. Then Asia Pacific with a 17% market share, followed by Central/South America at 6.7%. Of the major industries surveyed in the AESC’s 2013 annual report, Industrial held the largest share of worldwide senior executive search activity with 25.8% of the market in 2013, followed by a resurgent Financial Services sector with 19.1% of new searches started, and then Consumer Products (18.3%), Technology (15.4%), and Life Sciences/Healthcare (13.6%).
AESC Member Directory
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