search-consult Issue 36 by margaret jaouadi

2009 / ISSUE 36

The International Executive Search Magazine Published by Dillistone Systems

Stanton Chase In The Middle East Surviving This Challenging Market How To Select An Executive Search Management System Executive Search In The Public Sector The Impact Of A Bad Hire InterSearch: Recruiting In Emerging Markets

Anna Tavis: “In Uncertain Times, Be Prepared To Change”

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Joseph Daniel McCool consults globally on executive search best practices. He is the author of Deciding Who Leads, recognized widely as “one of the best business books of 2008.” He is a former contributing editor and online columnist for BusinessWeek and former editor of Kennedy’s Executive Recruiter News. He also writes as senior contributing editor with ExecuNet. Contact him at Joe@DecidingWhoLeads.com.

MANAGING DIRECTOR Jason Starr jason@search-consult.com EDITORIAL Pilar Gumucio editorial@search-consult.com PRODUCTION Margaret Jaouadi margaret@search-consult.com

ADVERTISING/SUBSCRIPTIONS/REPRINTS UK and Europe North and South America South East Asia and Australia Yann Le Leyour enquiries@search-consult.com or log on to www.search-consult.com

search-consult.com Third Floor, 50-52 Paul Street, London, EC2A 4LB, United Kingdom Tel: +44 (0)20 7749 6102 Fax: +44 (0)20 7729 6108 www.search-consult.com

For manuscript/ photographic submissions, please e-mail our Editorial department or write to the address above to obtain author/ photographic guidelines.

search-consult is published quarterly by Dillistone Systems Limited, Third Floor, 50-52 Paul Street, London EC2A 4LB and printed by Mr. Bloom Ltd, Sopot, Poland, www.mrbloom.com.pl. Periodical Postage PAID at Jamaica, NY. POSTMASTER: Send change of address changes to Dillistone Systems Inc., 50 Harrison Street, Suite 201A, Hoboken, NJ 07030. All statements, opinions, and expressions are the sole responsibility of the authors and the Publishers reserve the right to amend/alter articles as necessary. The Publishers cannot be held responsible for any loss or damage, however caused, of any materials supplied. Any materials supplied may not always be returned. No part of this publication may be reproduced in any format without prior written consent of the Publishers.

Relationship Capital If there’s one thing everyone in the global business of executive search consultant can agree on, it’s that this business centers on relationships. Relationships forged with the many agents of the corporate client enterprise – from the CEO and key business unit leaders to the Chief Human Resource Officer and others. Relationships created with exceptional candidates. And relationships struck up with respected peers and mentors also in the business of leading the search for leadership talent – the most critical business agenda for any organization. Yet it is these very critical relationships that have been stretched and strained, created and destroyed over the past several months as we’ve all tried to wrestle with the harsh realities of a significantly challenging global economy. Some relationships stand the test of time and intense organizational pressures. Others simply do not. Clearly, there are many complex – and especially today – many rapidly emerging dynamics that speak to the depth of your relationships with clients and prospects and their value. I simply can’t address those here in this space and this format. However, what I can raise and what I would suggest you think seriously about is the diminishing return on any one client relationship. For many years, in the days before senior executives changed jobs so very often, an executive search consultant could build a single, critical client relationship and reap the dividends of that investment for years to come. These days, those incredibly valuable, long-term relationships are in serious jeopardy. With senior executives changing jobs about every three years, on average, and CEOs moving to new companies about every four years, your ability to migrate relationships between corporate entities is just as important a barometer of future growth for your practice or firm as is the need to constantly invest in business development. Eventually, the global economy will return to growth mode, and the corporate mandate will demand new management leadership talent. Execution of search assignments will be the focus, but savvy search consultants will nevertheless remain committed to business development, too. Part of this case cautioning about the diminishing returns on client relationships stems from the short-term focus of many business leaders and organizations. With some, it amounts to a serious case of attention deficit syndrome. Some clients can’t seem to pay enough attention to any one challenge – even the most critical. Everyone is moving so fast these days. Institutional memories are painfully short. And with executives changing jobs and employers with such relative frequency, relationships may be short-lived for any one of a number of reasons. Pour your very best into every one of your client relationships. But remember that if you pour everything you have into your existing relationships, you quickly lose the capacity to create new ones in a business environment that demands both adaptation and a continual focus on new relationship capital.

Joseph Daniel McCool Joe@DecidingWhoLeads.com

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Anna Tavis:

“In Uncertain Times, Be Prepared To Change” By Pilar Gumucio

e are currently living in uncertain times. The global economy is in disarray as the prospects for the future are still very unpredictable. As a result, companies are reassessing how they operate, are reprioritizing their talent management needs and are rethinking the best options to attain their talent requirements. In turn, these same companies must re-evaluate their existing relationships and see which ones are helping them achieve their objectives and which ones are holding them back. search-consult spoke to Anna Tavis, PhD for her valuable insight on how companies and executive search providers are reacting to this current business environment and what needs to be done to effectively move forward. Tavis is an internationally acclaimed expert in talent management, having pursued a global, multi-faceted career in business, academia and consulting. She has led the organizational development function for Motorola in the EMEA regions; been Head of Talent Management for Nokia; headed learning and development at United Technologies Corporation and, most recently, is the Global Head of AIG Investments Talent Management and Organizational Development. Tavis has also served on the faculty at Williams College, Fairfield University and Columbia University. She has authored various book chapters and articles in international journals. Tavis is a frequent presenter at international talent management forums and is currently the Editor of People

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Anna Tavis

and Strategy Journal, a professional HR publication. This HR expert describes how the financial crisis has impacted virtually every company worldwide. As a result, management really needs to take this critical time to really assess where a company needs to be in order to be a market leader. In terms of HR, this means looking at ways of “retooling, re-educating and upgrading to address the new talent needs that are arising.” She elaborates: “Management really has to re-evaluate every function, making educated judgements of what it will look like in the future. And this future has to be defined with as much foresight as possible, breaking away from old assumptions, strategies and ways of doing things.” In terms of talent, Tavis urges companies to re-assess their talent

acquisition, retention and development strategies. Corporate executives should be looking to attract new skills, retain certain skills while simultaneously striving to develop other skills the company really needs to be competitive. Yet, how can HR retain and re-develop professionals that have lost their trust, their commitment and their motivation to drive the company they work for forward? Furthermore, how do companies attract new talent in this current business environment? Is it a lost cause, or is it a new opportunity for reinvention? In fact, companies are really taking the time to reassess their talent needs and refocus their talent strategies. Tavis provides an example of how “during the good old times, there was less internal thinking done as more functions were outsourced as company heads relied more on external providers to define, identify and attract the right talent.” Now, this is changing as internally, management, HR and operations are working to have more internal dialogues about the specifics of the role before clients even approach their search providers to make sure everyone involved is looking at it from the same perspective. BE AWARE THAT EXPECTATIONS ARE CHANGING As clients become more proactive, they are expecting their search providers to do the same. According to Tavis, a good search provider should always be able to “be in tune with the changes that are occurring around us, develop the necessary skills to upgrade and be able to diversify their

services so that the client’s talent needs are always taken care of.” As the world gets smaller, clients are paying more attention to what their search providers do and how they deal with a crisis. Are they being supportive to both their clients and candidates, or are they too focused on their own business development needs? During this economic downturn, most searches have been frozen for over a year in Financial Services since replacements are being hired from within. This same pattern is repeated in many other industries. Many search firms have closed down while others are aligning forces, providing companies with a broader or more specialized service. Some are taking advantage of acquiring firms, others are acquiring talent. Yet, those search providers that are going the extra mile, shifting away from a business transaction mentality to establishing a long term partnership, are continuing to play an important role in their clients’ decisions. Tavis explains how these search firms are providing companies with valuable resources, which are helping clients to make better, more informed, decisions. Some of these initiatives have included: organizing conferences and forums; providing companies with access to their latest research and assessment tools as well as offering their in-depth knowledge and expertise in complementary issues - such as leadership development, management audits, benchmarking, compensation structures and coaching as a means of helping these companies really assess, develop, retain and attain the best talent. “Although they are not engaging in a search assignment,” she states, “the services they provide clients have been critical, serving to intensify a long-term partnership.” LOOK BEYOND THE SEARCH Within this context, it is important to understand that executive search is no longer simply about conducting replacement searches to fill a vacancy. There is more research and planning done from both the corporate and the search

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sides, paying closer attention to what the role should entail and who can best address these talent needs. In terms of selecting a search provider, Tavis advises clients to look beyond a brand or a preferred provider agreement. “Select a search provider with a broader reach, a consultative nature, deeper expertise and one that is capable of educating you so you are able to make better and well informed decisions.” This means that clients no longer want their search provider to dictate the type of talent that will be sourced and hired. Instead, both sides are working to create a real partnership, each adding value to the process. According to this HR director, executive search providers will still continue to be “evaluated by their ability to approach candidates, make offers, help in the negotiating process and help to close the deal.” Nevertheless, they are expected to do so much more. The search firm must also be able to demonstrate that it really believes in the client, understands their potential and can establish a strong relationship and track record with the company’s candidate pool. Tavis insists that it is not necessarily who the executive recruiter knows or whether the search professional has a broad network; what counts is how effective that network is. ”An individual consultant’s brand is just as important as the firm’s brand.” What makes an effective relationship is “the search provider’s ability to be trustworthy with clients as well as candidates.” This is a change of mindset, focusing on the bigger picture instead of individual business transactions. Those search firms that have been generous with their resources, proven their loyalty and supported their clients throughout this economic downturn will eventually be compensated once business picks up. DON’T FORGET YOUR CANDIDATE The same should be said about how search firms manage their candidates.

Tavis explains that many candidates have told her how some search consultants are being short-sighted and arrogant, not wanting to call them back because they have been displaced, forgetting that before this economic downturn these same recruiters were constantly pursuing them with offers, for references and to obtain valuable information. Many of these same candidates had once been clients. Do you really think they would hire them now? What messages are these search consultants sending out with this type of behavior? Are they aware that clients are also paying close attention to how these candidates are being treated? In the end, this unprofessional behavior will only alienate candidates and clients, losing an implicit trust that is required for executive recruiters to do their job effectively. According to Tavis, these candidates will probably favor those search consultants that have remained trustworthy, “that have been extremely generous with their time, helping those that have been displaced, engaging and counselling as well as educating candidates on how to find a new job. It is about establishing and cultivating relationships.” At the end of the day, change is inevitable. What you can do is to prepare yourself accordingly. Clients should continue to reassess their talent needs, focusing on how to attain, retain and develop their best talent. Search providers, in turn, must learn to be more flexible and adapt to their current surroundings. Sometimes this means providing valuable information to a client, other times it means sourcing a needed skill. Their effectiveness will be judged on their ability to be in tune with the changes that are occurring around us, develop the necessary skills to diversify their services and cultivate the necessary relationships that successfully address their clients’ talent requirements. www.search-consult.com For more information visit: Web: www.search-consult.com

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The Middle East:

APromising Land For Stanton Chase International By Jason Starr & Pilar Gumucio

espite the global recession and economic uncertainty that continues to loom, Stanton Chase International, a top-ten retained executive search firm with 68 offices in 41 countries, is optimistic about the opportunities that the Middle East holds for executive search. “We were very pleased to have hosted our 39th global partners’ meeting in Dubai due to the importance of this emerging Middle East market for our clients, to better feel, learn and experience the culture of the region,” said Steve Watson, International Chairman of Stanton Chase. “We were fortunate to have the opportunity to meet several CEOs and managing directors in the region, and to better understand the business climate and value here.” Panos Manolopoulos, the Managing Director of Stanton Chase Middle East, met with search-consult after this meeting to explain why Dubai and the Middle East are considered to be so important for this leading executive search firm. Stanton Chase first opened its office in Dubai in 2006 to assist organizations in identifying, assessing and attracting outstanding individuals for senior management and board roles across the Middle East region. The Dubai office works as a hub for all the firm’s Middle East operations, which are primarily for clients that are in the GCC countries (composed of Bahrain, Kuwait, Qatar, Oman, Saudi Arabia and

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the United Arab Emirates) and the Levant area. The first to use this service were multinationals with offices in the Middle East and local companies, both with rapid growth plans. Their clients were mainly in energy and natural resources, industrial, financial services, technology as well as consumer products and services. AVAILABLE OPPORTUNITIES “Now, despite the crisis, the Middle East is a very promising place for business,” reports Manolopoulos. “There is a great deal of interest and money being invested from very strong family conglomerates who are looking to expand throughout the Middle East as well as to other regions.” Moreover, he describes how the global recession has had a positive impact in the Middle East, initiating a “cleaning process” as many companies are now in the process of rethinking their HR strategies and restructuring their talent bases. Initially, companies in the Middle East were desperate to hire talent to open their offices and expand their operations; as a result, they did not necessarily hire the most qualified executives. Therefore, companies soon became overstaffed. Moreover, companies did not necessarily have the expertise or the skill sets they had intended to and executives were frequently changing jobs in favor of the most lucrative offers; nevertheless, nothing was done to correct the way these executives were hired.

A NEW ERA EMERGES The global recession and economic uncertainty have made businesses reassess their current strategies and practices. Have they really been effective? What must these companies do to ensure that they are really being competitive? Manolopoulos explains: “We are now moving into a new era where companies are seeking to invest in quality candidates, which means that they are being more selective in hiring new talent as well as exploring new ways to retain their top executives for a longer period in time.” As a result, companies across the Middle East are assessing their management teams and determining gaps that need to be filled so that when the economy bounces back these companies are ready to start hiring. This may also be a good time for small and medium-sized companies to attract good talent, which can strategically help them become more competitive. Despite the significant drop in the executive search business from the beginning of 2009, there are positive signs that this may soon change. For example, financial services were severely hit as search virtually came to a standstill throughout the world. Nevertheless, opportunities in financial services have continued in the Middle East as many of the Islamic banks saw this as a good time to aggressively attract talent from the West. Oil and energy are also still in demand,

although the latest tendency is moving away from oil in favor of alternative energy resources. “Areas that were not hit by the recession,” Manolopoulos reports, “are the educational sector, pharmaceuticals and healthcare sectors. Some of these sectors even reported higher demand than last year. I assume once the recession is over, banking will be strong as construction, real estate, consumer and retail, industrial and especially technology will bounce back.” The announcement of the Abu Dhabi investment of 20 million dollars and Sheik Mohammed’s plan for continued investment in the Middle East until 2015 are also perceived to be positive signs that the economy, and hence, the search business in the Middle East, will soon be back on track . Manolopoulos describes how Stanton Chase International is planning to open offices in Riyadh, Saudi Arabia and Qatar in the near future. “In the rest of the countries in the Middle East we plan on having satellite offices, branches or cover from Dubai.” THE MIDDLE EAST DIFFERENCE Although executive search is a methodological approach, each country and region has its own particularities that must be taken into consideration when providing this service. The Middle East is no different. Business revolves much more around personal relationships, family ties, trust and honour. There is still considerable reliance on executives hired through directors’ own networks or recommendations, particularly amongst local Arab-owned businesses. In order to succeed in penetrating the Middle East market, executive search consultants must show these companies that relying on their local network will no longer suffice in a dynamic, aggressive and internationally evolving marketplace. They must demonstrate that their added value is making what has often been perceived as an opportunistic hire into a strategic one. Establishing that vital trust with the client company in the Middle East requires personal attention by the search consultant.

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This not only entails regular updates on the assignment, but permanently satisfying queries and building a long lasting relationship so that the client adheres to the strategic benefit of the cost (which still acts as an obstacle for prospective clients). Information about the financial position and the senior management structure for many of the businesses, especially the family held companies, is not readily available to the public. This poses a great challenge for the search consultant, especially for targeting companies and candidate identification. Requesting information about the client’s decision-making processes or financial information is sometimes viewed with a great deal of skepticism. As a result, the search consultant must be very tactful and diplomatic in persuading the owners/ decision-makers that providing this information is crucial to the success of the search assignment, and therefore, the success of their own company. Manolopoulos illustrates how important personal relationships really are in the Middle East as he describes how a great deal of companies still select a search firm based on the consultant’s family status, origin and religion then on the search firm’s performance. To be effective in the Middle East, search consultants and researchers

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must have a strong understanding of local traditions; they must be aware of the intricacies of the Middle East markets in order to identify and introduce culturally matching candidates locally and internationally, whose adaptability to the client company should be assessed beforehand. Therefore, the executive search consultant tends to develop close relationships with the candidates as well. In fact, the consultant is fundamental in acting as the mentor and coach, either for a European candidate coming into a local business or a local candidate entering an international firm. Another interesting particularity to the Middle East is that all its searches are global, and therefore, are all cross border searches. Manolopoulos states: “They are not country or region specific. In fact, 85% of the top talent in the Middle East are expats from all over the world, demonstrating how global these searches really are.” As a result, Manolopoulos strongly believes that Stanton Chase provides the perfect mix, which enables this leading executive search firm to “be able to effectively maximize their client’s value through a consultative relationship, focusing, adapting and responding effectively to the diverse business challenges of their clients and potential clients.” In the Middle East, this means having sourcing and talent acquisition teams that have intimate knowledge of the cultural particularities, can develop effective and long lasting personal relationships with companies and candidates worldwide as Stanton Chase International continues to deliver long lasting results and added value. Panos Manolopoulos is the Managing Partner of the Middle East operations of Stanton Chase International. He has been a member of Stanton Chase since 2003 when he started as General Manager of the Bucharest office and became Managing Partner in 2005. He is one of the shareholders of Stanton Chase in Romania, Bulgaria and United Arab Emirates.

www.search-consult.com For more information visit: Web: www.stantonchase.com

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How To Survive Today’s

Bob Benson:

Challenging Market

ob Benson has more than 25 years experience in executive search, having been named as one of “The 50 Most Influential Headhunters” by Business Week in 2008. He most recently established RLBenson & Associates, a consultancy that serves the executive search industry, assisting firms of all sizes and geographies to find innovative solutions and prepare them to thrive in all market conditions. Benson spoke with search-consult to provide search firms with tips on how to reinvent themselves, be effective and add value. He advises executive recruiters to commit to best practices and high quality standards while remembering that a key component for success is to be flexible and present customized solutions. Benson also discussed some of the key challenges and opportunities found within the search industry today:

sc: What is the key challenge you see in today’s market? Bob Benson: Benson The key challenge is survival. Many firms have been forced to focus on short-term, immediate priorities: working on business development and their immediate assignment pipeline. People are wondering what’s next for the search business and are asking: “What is the new model?” Nearly every business sector is going to be different coming out of this global recession. The question for many search consultants looking ahead is how does the individual consultant remake himself or herself? Longer term, I believe many firms will also have to wrestle with this issue: how does the industry capitalize to protect itself from the staffing level volatilities that come with the business cycle?

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By Pilar Gumucio

as well as onboarding those who are hired. We need to hone in on effective job specifications, leverage our networks to identify top-notch people and only then can we take the process full-circle by leading a meaningful on boarding program. From a global perspective, we’re seeing an increasing number of expatriates being attracted back to their home countries. Search consultants tend to know where many of their nationals are sitting elsewhere in the world. I believe there is significant opportunity now to recruit them back home, and the fit could be right because they already know the local customs and business culture. Robert Benson

sc: What are some emerging opportunities that search consultants should be looking at? Bob Benson: Benson There are some significant shifts underway that present interesting opportunities for the executive search business. Just consider the move toward green business practices and the growing investment in alternative energy. The U.S. federal government and all health/medical related segments are significant market opportunities. The challenge is how quickly search consultants can bring themselves up to speed on searching for government sectors or understanding the nuances of the healthcare industry. Search consultants should put their focus on practices that can sustain their firms for the long run. Anything that enhances the effectiveness and long-term nature of their placements is a good thing. The search business needs to get better at identifying and assessing candidates

sc: How do you see client expectations and relationships evolving? Bob Benson: Benson Many corporations, large and small, private or publicly traded, have seen tremendous changes in their industry environment, their organizations, their leadership as well as the world economy around them. Client expectations’ real focus now is on performance and, of course, the strength and durability of these relationships depend on consistent performance. The issue here is that clients are also working smarter, becoming more sophisticated and are more knowledgeable on: how search operates, the strengths and weaknesses of how the business of search is conducted and what to expect with performance standards. It’s critical that search consultants reach an understanding with their clients up front, creating and managing mutual expectations. This requires more dialogue between the consultant and client up front to set the stage for the search. The search consultant needs to know the expectations

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Out August 2009!

The most comprehensive source of reference on suppliers to the talent management industry

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of all the constituencies within his or her client. New circumstances may arise during an engagement and expectations may force an adjustment of work styles. I think flexibility will be one of the watchwords for a strong client relationship. Don’t take a set process and expect it is the only process. Bring some flexibility because change will be the one constant. sc: What should search firms do to ensure that they continue to meet or exceed their clients’ demands? Bob Benson: Benson Search firms need to understand client and candidate attitudes about the process, during the search and immediately after it is completed. Whether through satisfaction surveys, mid-process check-ups or post-search reviews, everything should be focused around the client. By conducting reviews, clients and consultants know what needs to be done to keep the engagement successful. Constant rechecking to make sure that the engagement is going well can really ensure a good result. Search should be viewed as a constantly evolving process which is ALWAYS client-centered. sc: How do search consultants reinvent themselves and continue to create opportunities for themselves? Bob Benson Benson: There isn’t one solution to every assignment. Nor is there one magic bullet approach to find the best candidates or negotiate a deal. Executive search was formed, and continues to be practiced, as a custom-tailored business. The executive search business has mistakenly tried to take custom-approaches and apply them to off the shelf “buy and wear” retail methods. Search really needs to be a solid, well-defined line separating the value and commodity side of executive recruitment. If search consultants make a commitment, a real investment to get better at what they do and really develop special expertise to serve their clients, the value they bring will be far easier for the client to recognize.

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sc: What are the specific areas that you advise search firms to focus on improving? Bob Benson: Benson Search is, at its core, a client-facing endeavour. Everything you do should be focused on best meeting client needs and staying pure to professional standards. However, that doesn’t mean that everything the client says is absolutely right. You have a duty to listen to that client, and if need be, to lead that client and to help that client see the reasoning behind your approach, your recommendations and your expert advice. We need more rigor put into every assignment. Sometimes that means providing what the client wants, and in other cases it means offering what the client really needs, based on your in-depth knowledge of the business, its strategy, its leadership and its competition. Whenever you’re pushed by a client, you must stay committed to your values. You know what goes into a successful search and although you must demonstrate a high level of client sensitivity, don’t jeopardize the disciplines that go into a high quality search. sc: Within these tough times where companies are hesitant to use executive search firms or are even developing inhouse search teams to source top talent, what advice can you provide search consultants on how to be competitive and attract new business? Bob Benson: Benson There are really two key elements to consider. First is PREPARATION. It’s critical that you understand your client, their needs, their culture, their issues and their challenges. Know your sales strategy before going into a client pitch. During your preparation, you’ll identify the questions that will need to be asked of the client. The better your questions, the more respected you’ll be and the better your chances of standing out from the competition. You’ll leave an impression with the client/prospect if you do your homework and make your responses customized to your clients’ needs.

The other element starts with everything you do through the execution of your search. If you bring a truly consultative mentality, frame the need, proactively communicate, work effectively with candidates, stay diligent to the process, follow your candidate through the entire process and you’ll have demonstrated a real commitment to your client and his or her desire for a winning outcome. Remember that everything you do builds your reputation. The better your reputation, the more likely you’ll survive through tough times like those we’ve experienced during the past several months. sc: What key tips can you provide search consultants to ensure that they remain competitive and add value? Bob Benson: Benson 1. Gain and maintain relevant knowledge in your primary market space (even if you’re seen as a generalist, you have certain common best-practice threads in your engagements – connect them for the benefit of each of your clients). 2. Gain and maintain a strong network of people in your chosen space. Your job is to know people, get to them quickly and do so in a trustworthy manner. 3. Always be client-centered - no matter what your short-term priorities are. Know what they are looking for and make sure you are adapting what they are asking for without sacrificing quality and commitment to professional standards. 4. Never stop growing or learning. This is becoming a requirement for every business executive – and every executive search consultant. Constantly work to upgrade your skills and stretch yourself. www.search-consult.com For more information visit: Web: www.rlbensonassoc.com

Jill Dillistone is a search professional with more than twenty yearsâ&#x20AC;&#x2122; experience of conducting research for retained executive search firms including Spencer Stuart and Russell Reynolds. She has managed pan-European research teams and has developed and delivered training courses for multi-national groups of researchers and consultants working for firms such as Heidrick & Struggles, Russell Reynolds and Whitehead Mann. She has run workshops in most countries in Europe, in the United States and in the Far East. A British national, Jill lives in France and speaks good French. Research & Candidate Development Workshop London, UK - October 13, 2009 This 1-day workshop is for less experienced researchers and consultants. The three themes covered during the day are research skills, telephone techniques and administration and project management. Search Execution & Client Management Workshop London, UK - October 14, 2009 This 1-day workshop is for professionals involved in the search execution process and focuses on effective and successful client management and liaison (including progress reporting), candidate interviewing and referencing and the preparation of candidate reports and package negotiation. Interview Skills Workshop London, UK - October 15, 2009 This 1-day workshop covers an introduction to compentency-based interviewing and an exercise in critical-incident based interviewing. The benefits of the day include the opportunity to improve your skills in candidate evaluation; practice different questioning techniques in role plays and learn about different approaches to interviewing.

For more information and to book, please visit www.search-consult.com/workshops or send an email to events@search-consult.com

This series of online seminars gives the person responsible for executing each phase of the search the basic building blocks needed to insure a successful search outcome. They are aimed at the search practitioner, researcher or consultant, at a search firm or in-house search team, who are newcomers to search or seek a refresher course in a processoriented, disciplined approach to search. Betty Wong Tomita & Gai Galitzine have been executing searches in the Americas, Europe and Asia for more than 25 years. This series of real-time online seminars is a unique opportunity to benefit from the techniques and approaches Betty and Gai have distilled from their broad knowledge of the industry. Each seminar provides an in-depth exploration of specific topics in the search process through interactive dialog and demonstrations based on extensive real life search experiences. Building Search Strategy Name Identification - How to find these people? Approaching Candidates - How do I get the most out of conversation? Pre-Screening Candidates - Is this person a candidate? Getting The Complete Picture - How do I check references?

*NEW dates available online

For more information and to book please visit www.search-consult.com/webinars Each session costs US$150 / UKÂŁ90 / â&#x201A;Ź100 Please call us on +1 (201) 653-0013 or +44 (0)20 7749 6102, or send an email to events@search-consult.com. Online payment facility as well as downloadable booking form available at www.search-consult.com/webinars

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How to Select

Executive Search AnManagement System

electing an Executive Search Management System (ESMS) can be daunting and confusing, especially in today’s competitive environment where there has been a bombardment of “apparently similar” products in the marketplace. As a buyer – whether you are the head of a retained executive search firm or in charge of leading a corporate talent acquisition team – that is looking to purchase an ESMS, it’s vital that you understand the differences between systems designed for recruiting passive candidates and those that target more generic recruiting processes. This article aims to identify some of the key issues. Dillistone Systems - the leading provider of software and services to clients in 56 countries - has over twenty years experience in developing a comprehensive, flexible and easy to use tool for executive recruitment. As Managing Director of Dillistone Systems and Editor of search-consult, I strongly believe that sourcing the best Executive Search Software System will increase your firm’s competitive advantage. I hope this

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By Jason Starr article will help those tasked with selecting a new ESMS to better evaluate the different options available in the market. HOW DO YOU FIND YOUR CANDIDATES? Many executive search firms work from the starting point that the “successful candidate” is not necessarily going to be on the database at the outset of a search assignment. Clearly, this is very different to the mindset of a lower level recruiter for whom the database of candidates equates to the entire candidate universe. There are essentially three types of searches which you need to consider when selecting a new system: • Database Search - Most search firms tend to search for candidates by attributes (industry, function, etc). Virtually all systems designed for recruitment will offer this type of search. • Document Search - The ability to search documents has come on

leaps and bounds over recent years and any system worth considering should offer this functionality. Search is typically “Boolean in nature” which means that users can search for a combinations of words – i.e. Find me any resume or profile report that contains the words “China” or “Hong Kong” AND Japan. The results screens should offer a preview of any found documents (similar to a Google results screen) and it should be possible to jump from a list of results to either the candidate record or the appropriate document. Be aware that some systems do not fully integrate document searching with database searching, and if this is the case, these may not be combined and the results are often only available as documents. • Internet Search - The concept of searching the Internet for candidates is a relatively new one, and very few Executive Search Management Systems feature any functionality in this area.

Some vendors will suggest that the ESMS is partnered with a separate online research tool. Putting aside the cost implications of this, buyers should keep in mind the efficiency loss associated with running two separate systems. The “ideal solution” should be a build-in functionality – like FILEFINDER’s Research Zone – which enables you to search for passive candidates based on your target list of companies on corporate websites, social networks, press releases, etc. By being able to combine retained search concepts with web search technologies, the user is then able to “teach” the ESMS to search key sites of interest (some companies like to search generic sites such as LinkedIn, while some will wish to target industry specific publications or websites) to automate the process of finding this data. WHAT ABOUT THE DATABASE? In terms of database design, the biggest difference between a system designed specifically for executive search and one for lower level recruiting is the concept of “People as People”. Recruitment software designed for low-level recruiting will have seperate databases for “candidates” and “client contacts”. In executive search, today’s candidate is tomorrow’s client.... and next week’s source. The database structure should reflect this and in practical terms, this means: •

When viewing a person record, can you see what type of contact you have with that person? From a single location, can you see if that person is a candidate, a client or a source?

• When viewing a company record, can you track all contacts with the organization – whether it be business development, sourcing or with potential candidates? • When a business has multiple subsidiaries, can you easily see all

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employees, assignments, etc from a single location? Many search firms take a “target company” view of recruiting. This means that the employment history of a person is crucial. As a result, it should be possible to identify candidates who have worked (or do work) at a certain organization and, when necessary, be able to cross reference the results of that search with a certain role (i.e. – find me all of the people who work for IBM in a sales role, include current employees and previous employees that have recently left). CONFIGURATION OPTIONS Systems vary hugely in terms of how configurable they are. At one extreme, mass market products like ACT or Access provide some database or CRM functionality “out of the box” but need to be completely configured prior to use. At the other extreme, some products are defined specifically for the Retained Executive Search Recruiting Model. Even these will require some configuration. For example, if you work in financial services, your codes will need to reflect that. You may wish to make certain fields mandatory while other fields may need to be greyed out. Most systems will offer this functionality, but it is important to understand the extent to which configuration may be done by you, and the extent to which configuration needs to be done by the vendor. Be wary of scenarios where the vendor charges for configuration – this suggests that you will be going back to the vendor every time your business changes, incurring additional costs. WHAT ABOUT THE VENDOR? Many buyers tend to focus too much on the product and not enough on the vendor. This can be a serious mistake. Buyers should always: • Perform a credit check. This is always important, but particularly so in the current environment. It is a sad fact

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that most software houses fail within 5 years, and the recruitment software industry is no different. • Understand what support is available and the level of support supplied. Some vendors offer round the clock support – but in many cases this may equate to an “emergency cell phone” in the back pocket of an engineer who is in the pub. Think about what hours your staff work and ask the vendor to explain the type of support provided during those hours. Ask for a telephone number you can call to put support to the test. • Understand the opportunity for learning “best practice” from other users. The Internet has made it easier for users to exchange ideas, and larger vendors now have online user groups, streaming training sessions, etc. Ask if a vendor offers any of these. • Understand the extent to which products are future proofed. A number of vendors will tell you that “software upgrades are included within the support contract” but will then never – or rarely – release these upgrades. Know how often the vendor releases new software, and understand the level of functionality provided in those releases. If a vendor only brings out new software every 5-6 years, then your business will be left behind. DOES IT REFLECT YOUR NEEDS? To what extent does the system offer support for business development and marketing? Many systems – particularly those primarily designed for “in-house recruiting teams” have little or no functionality in these areas. For most search firms, however, this functionality is crucial. Key points to understand include: • How does a Consultant track his or her clients and potential clients? ISSUE 36 2009 search-consult

How users of most Executive Search Systems research target companies online:

How users research target companies online:

Leave the database.

Open the Research Zone.

The Research Zone will search the web and present the results in its integrated browser in less than a second, with typically just 3 clicks.

Open a browser.

Enter the search area.

Manually build a search.

Try to fit the browser and the database on the screen.

Drag and drop the information you want into FILEFINDER, and click to research the next company.

Manually copy/paste data between them.

No typing. No manually building new searches.

Manually build a new search for the next target.

Repeat...

Executive Recruiters in 56 countries have made the right choice already... have YOU? To learn more, email sales@dillistone.com TODAY and mention search-consult magazine!

USA: +1 (201) 653-0013 • Australia/Asia: +61 2 8221 8860 UK / Other Europe: +44 (0)20 7749 6100 • Germany: +49 (0)69 27 40 15 807 sales@dillistone.com • www.dillistone.com

• How can a business target a specific industry sector and run a business development campaign? • Can the system produce financial forecasts and pipelines reflecting potential future revenues? EMAIL, MS OUTLOOK & MOBILE DEVICE INTEGRATION This is a major decision for some buyers. If your business uses MS Outlook as its main email and calendar product, you will need to ensure that your chosen product features a suitable level of synchronization. Key areas to understand include: • Will appointments created in your database sync with MS Outlook? • Will any changes be updated in your database? • Will you receive the same functionality with ToDos? • Can you import emails directly from MS Outlook into your database? • Can you send emails from your database via MS Outlook? • Can you synchronize Contact information with MS Outlook? Is this security controlled? • Does MS Outlook “read” information from your database? Are database previews available directly from incoming emails? • Can data be accessed and updated from iPhones / smartphones etc? RELATIONSHIPS Good research requires imagination. In practical terms, this means the ability to make logical “jumps” from one location to another, quickly and easily. For example, from a list of companies - show me all of the former employees. From a list of searches, show me all of the target companies. From a person’s record, show me all of his or her former colleagues, fellow board members or referees. This type of functionality is fundamental for those search firms who identify candidates by recommendation and most products struggle in this area.

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WEB INTEGRATION You should consider: • Does the system offer “candidate side” web integration? Can the search firm upload positions, and can candidates apply for positions via the web? • Does the system offer “client side” web integration? Can the client log in and see their assignment type information? RÉSUMÉ EXTRACTION This technology will allow users to create database records based on résumé content without the need for retyping. Most systems provide this type of functionality, but the key concern for a retained search firm is that of quality control. Résumé extraction is a form of automation and – like any form of automation – there is normally a payoff between quality and speed. For retained search, the quality bar is far higher than it would be for most other types of recruiting. Yet many systems neglect to place quality controls into their extraction technology. Key points to understand: • Can the system automatically ”extract” infomation from résumés? Specifically, this might include: - All contact information - Employment information - Education information • To what extent is incoming information “quality controlled” – how does the user avoid duplication of both people and companies? • How does the system handle updates of existing information? INTERNATIONALIZATION Many vendors now support clients internationally – at Dillistone Systems we have clients in 56 countries. Ensure that your supplier can provide a suitably localized product, for example: • Does the system support local character sets?

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• Can the system support multiple currencies? • Is functionality such as spell checking suitably localized? REPORTING There are two major types of reporting which you may require from an Executive Search Management System: • Client Reports – assignment reports, etc. • Management Information Reports – database usage, etc. Systems designed for executive search are likely to have many standard reports built in, and these will typically represent “best practice” within the industry. Check, nevertheless, that reports may be produced directly into Word or Excel, and that you have at least some ability to write your own reports. REFERENCES Take them, but check what you are getting. Does the vendor have clients who are comparable to you in size, location, sector and specialization? Make sure to speak to these clients to ensure that their expectations have been met, they are happy with the product and the ongoing support provided by the vendor. See if the ESMS selected has added value to their executive search process. If the answer is yes, then they have selected wisely. Make sure you do the same! Dillistone Systems is the leading provider of executive search software and services to clients in 56 countries. In fact, FILEFINDER Executive Search Recruitment Software is used by more than 1,000 companies, including executive search firms and Fortune 100 corporate clients. The main reason for this is simple: FILEFINDER is focused on the idea that search firms do not wish to just identify the best person on the database, but that executive search firms are more interested in identifying the best candidate for a particular position anywhere in the world. For further information or to schedule an online demonstration of FILEFINDER, contact sales@dillistone.com.

www.search-consult.com For more information visit: Web: www.dillistone.com

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EMA Partners International:

“Our Success Depends On

Our Client’s Sucess!” By Pilar Gumucio

s EMA Partners International celebrates 21 years in executive search, search-consult spoke to its Chairman William J. Yacullo to discuss the executive search group’s development while, simultaneously, providing you with some tips on how to prepare your company and staff to move forward. sc: How has EMA Partners developed within these past 2 decades and what is the reason you perceive this organization to have remained so successful after such a long period in time? Bill Yacullo: Yacullo In 1988, two executive search groups - one US-based and the other UK-based - agreed to work together to better serve their international clients. This was the genesis and objective in forming EMA Partners International. At the time, there were ten partner firms, most of which knew each other personally and had previously interacted professionally. Today there are 50 offices on 6 continents. We know our success depends on our client’s success; which is why we focus on achieving lasting results for our clients. We also focus on having a closely knit network of partners, who are the “eyes and ears” of our executive search group as well as of our clients, having access to every major market and business center in the world. What has been fundamental in this process is having developed a strong bond among our partner firms that comes from frequent interaction, communication and assisting annual global and regional

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William J. Yacullo

meetings where we can personally discuss our clients’ needs as well as how the organization is progressing. sc: What are EMA Partners core values and key strengths? Bill Yacullo: Yacullo Our key strengths continue to be serving our client’s needs and our ability to put together seamless global teams. We provide our clients with personalized solutions and support them during these difficult times. We appoint a project manager to effectively communicate with the client and manage the various searches that are being conducted with the different partner offices for that client. We also invite client presentations to our meetings as a means of reinforcing our credo: “Clients come first”.

The core values that were in effect at the beginning have not changed, except for the fact that our reach has expanded into areas that, twenty one years ago, were not considered strong executive search markets; areas such as Asia-Pacific and Eastern Europe. In the past decade, many of our search assignments have taken on more of an international flavor and joint ventures between partners have been more prevalent. However, we cannot underestimate the expertise and professionalism of each of our individual partners, which has become more important as we continue to conduct cross border searches, remaining true to our belief: Global reach—local expertise.” EMA Partners understands that every search undertaken by us becomes a unique and strategic partnership. In fact, it has always been a policy of ours to not consider a search successful just because the individual accepts the offer, but to constantly check-in with both the successful candidate and the hiring managers to see how the individual is adapting to the organization. This is critical as we strongly believe that the staying power of candidates really is an indication of how well we handle the search process, managing both our clients’ and candidates’ expectations. This is crucial, especially as searches become more complex and more international. sc: Have your clients demands changed in the last 20 years? Bill Yacullo Yacullo: Our clients’ demands have definitely changed. While they still

are looking for the best fit, their demands for a broader-based, internationally experienced, general management have become more critical. It is important for senior managers to have experience and competence in dealing with a globallybased organization and to understand certain differences that exist within cultures. We assess these criteria by probing the candidates in our interviews and reference checking. sc: How has the candidate profile changed, especially during this economic downturn? Bill Yacullo: Yacullo Our candidate profile has also changed. Clients are looking for talent that not only has strong technical skills, but also has the ability to manage an organization through difficult times and the experience to withstand some of the pressures that the business community is currently facing. Candidates should have international experience as well as, in many cases, experience in multiple industries. Candidates that have successful experiences in a variety of settings (ie. countries, industries and organizations) are sought after. Candidates that have experience in reporting to management operating in another country are also increasingly in demand. sc: During these economic challenging times, what tips can you provide your clients and candidates to move forward? Bill Yacullo: Yacullo We have kept in strong contact with our clients, understanding that they may not have present needs. At a time like this, it is a good idea to review your management team and determine if you have the right people in the right places. As a service to our clients, we have offered to assess their management teams as we are pleased that several clients have taken us up on this, accepting our expertise and resources to help them move forward. Although candidates are more hesitant to move jobs, I think this is a good time for experienced, competent managers

to look at new challenges and consider new opportunities, especially if you have experience in turnarounds. sc: What do you perceive to be some of EMA Partnersâ&#x20AC;&#x2122; key challenges? How do you deal with them? Bill Yacullo Yacullo: EMA Partners will continue to grow and enhance its reputation for excellent client service. But, it will not be without challenges. The Chinese and Japanese markets have always been a challenge for us. We need to continually work to find the right partners who see the value of being part of a strong international search organization. We are also concerned about the professional development of our current partners. Any help that we can give each other to shore up our individual firms in these difficult times is important. This involves constant communication and consulting, as well as identifying business opportunities that can benefit more than one firm. While we are a strong international network of fifty offices, we are all individually owned, so the strength and competence of each office is critical. This is our greatest asset and simultaneously, our greatest challenge. I have been in the search business for almost three decades, and this is the fourth major economic downturn we have experienced. We survived the other three, and we will survive this one as well. Another key challenge is finding good people for our individual firms. There are consultants on the market now, but we will have to be cautious to not add individuals who may not be a good fit. We all have to look to succession planning for our individual firms, as well as leadership for EMA Partners International in general. sc: With the economic downturn affecting virtually every economy, what and where do you perceive EMAâ&#x20AC;&#x2122;s opportunities to be? Bill Yacullo Yacullo: With this economic downturn, we are looking for new markets. These might be in the not-for-profit industry,

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the academic and higher education sector, or in government. We also see that in the financial services industry, while definitely in a down-cycle, there are opportunities. We must seek our opportunities by constantly talking with our clients and monitoring the industry. We talked earlier about the assessment of individual managers within organizations, and I think that is certainly a way we can help our clients and continually monitor their growth and future plans. sc: How does EMA prepare to deal with these? How do you make sure your consultants have the same vision, training and its best practices with clients and candidates? Bill Yacullo Yacullo: We are only as good as our individual consultants, and in the search industry, clients generally hire a consultant, not necessarily firms. So, we have to make sure that our individual consultants understand not only the importance of a global firm, but also that individual and firm added value expertise is the most important thing we bring to clients. This is particularly evident as firms in the emerging search markets join us. Professional development programs are always a part of our global and regional meetings. We have established a mentoring program for the several new firms that have joined us (four within the past year). We assign an experienced search consultant to work with them and help them through their growing stages, all the more critical because of the economy. This mentoring process that we put in place is fundamental to the success of our organization and, of course, our clients. In short, we will continue to grow, individually as well as an organization, strategically partnering with our clients to provide our clients with effective and lasting results, listening to their needs and anticipating where they need us to be. www.search-consult.com For more information visit: Web: www.ema-partners.com

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Casting

Wider Net

Public Sector Leadership T

he Economist recently spotlighted America’s “next problem” as big government, but in an economic climate of big government and the public sector, top executive search firms provide some reason for hope. While financial services firms, auto manufacturers, consumer companies and other global industries struggle, some executive search firms - that specialize in recruiting talented new classes of men and women to manage these organizations and the challenges that lay ahead - are partnering with these companies to make sure they have the right personnel in place. The private sector, nevertheless, is not the only one turning to executive search firms for their expertise. In fact, the engagement of search firms by important public sector organizations in the Americas, Europe, the Middle East and Asia/Pacific is indeed growing. Government and public concerns know they need to cast a wider net to find the best candidates for leadership positions. Search firms are adapting their skills and know-how to explore and recruit world class talent in the public sector as well as the private. In fact, Boyden’s recent public sector clients include

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By John Byrne

the Abu Dhabi Airports Company, the Australasian Institute of Mining & Metallurgy, the Chilean Government and state owned corporations, Federal Bureau of Investigation (U.S.), London Heathrow Airport, London 2012 and the World Bank. GOVERNMENTS & SEARCH FIRMS ALIGN FORCES Governments throughout the world have been enormously successful using search firms to ensure the right combination of management is properly sourced and selected. In fact, in Washington DC, my Boyden colleague Tim McNamara’s team has had a record year. This is due to the U.S. Government’s stimulus package, combined with its new partnership with big business, making it imperative to merge public and private talent bases. For instance, in Washington DC, this year Boyden placed Lehman Brothers’ CIO as the FBI’s Chief Information Officer. And in Chile, our firm recruited Scotiabank’s Problem Loans and Real Estate Sales Executive as the Chilean Government’s Director of National Registry and Identification. Governments are turning more to executive search firms to ensure highly

qualified professionals form part of the public administration. In fact, this year, along with several other leading firms, Boyden was selected as a premier provider to Chile’s High Level Civil Service System (“Alta Dirección Pública”). Since its inception in 2004, 512 of the 837 positions in Chile’s Civil Service System have been chosen after a selection process has been conducted. The selected sectors are institutions in charge of executing public policies and community services such as Healthcare, Government Purchases, Social Security and even the Anti Money Laundering Office. For each senior role, the Senior Level Civil Service Office defines the job description with the respective Minister, including compensation levels. This job description outlines and describes seven attributes a Civil Service executive must possess. These descriptions must then be published in a leading national newspaper and publicly available online to ensure potential candidates can anonymously submit their applications during a 20 day period. At the same time, the respective institution hires a search firm to conduct a parallel search process. In both cases,

applicants selected must follow specific procedures to guarantee fairness. The selection system is subject to continuous audits. All candidates are entitled to question the fairness of the process at any time, and if any discrepancy is noted, the process can be declared null and void. The qualified applications are sent to the designated external search firm that interviews and assesses which are the most appropriate candidates that deserve further consideration. All the information is included in the reports that are constantly submitted to the Senior Level Civil Service Office, ensuring a rigorous candidate selection process is in place - based on competency, professional careers, integrity and transparency. NEW CHALLENGES Various new challenges within the Public Sector are arising. For instance, clients are demanding structured models. Therefore, we must make our IT systems compatible as a means to improve our efficiency levels. Specific steps that promote transparency must be in place and understood to be critical by all participants. Formatted analysis of bios, in-depth scrutiny of academic data and in-depth experience to match the profile is demanded as no deviations are permitted. Interviews and reports, record keeping, specific timing for report delivery (drop dead dates are imposed) and confidentiality rules are also specified. The civil service system is subject to in-depth scrutiny, both by the candidates and the public in general. Therefore, the search process must be handled correctly to avoid invalidating the process. Extensive research must be carried out throughout the entire process as executive search consultants must be able to effectively source candidates, but also provide the institution with valuable information, such as compensation levels, job requirements and candidate profiles. It is about using your skills to

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interview, conduct reference checks and provide your assessment as you help your client select the most qualified professional for that public sector role.

this recruitment process is helping us attract better quality candidates from the private sector, despite lower compensation offerings. Across the globe, we anticipate that Public Sector entities will continue a more aggressive effort to recruit and retain high caliber officers. To do so, we have no doubt that executive search will play a larger role through our capabilities to deliver a defined and consistent model. This is an extraordinary opportunity for our profession. This new business venue will require consultants that are willing and able to operate under very strict timing, rules and regulations. We don’t have the luxury of time as the Public Sector wants concrete results, turning to us to cast a wider net to source, attract and ultimately, attain the most qualified executives for public office.

John Byrne

The one restriction that public sector searches have - in comparison to private sector searches - is the defined nationality requirements that go along with government assignments. When assessing the candidates, bear in mind that the candidate profile slightly varies from those executives working in the private sector. For instance, candidates must be willing to work in a regulated environment, with rigid compensation schemes and follow the current government policies. We must identify professionals that fit the job requirements and that really want to “give something back to society” as this character trait is what will make them effective in working in this type of environment. The fact that this system is perceived to be working helps eliminate the traditional perception that all governmental roles were handed out due to political favors and pressures. On the contrary, we have not encountered any type of political pressure. In fact, the integrity demonstrated throughout

John Byrne, Managing Director of Boyden Chile, was born in Lima, Peru. John holds dual Chilean/British nationality. He graduated in 1977 from Universidad Católica de Valparaiso with a degree in Business Administration and as a Certified Public Accountant. In 2005, he completed a Masters degree in Business Law from Universidad Adolfo Ibañez. John has extensive banking experience, which includes 12 years at Bank of America in Santiago, rising to account executive, Corporate Finance Manager, Manager of Capital Markets to finally being appointed Chile Branch Manager in 1991. He worked 2 years as the Senior Country Officer for Chase Manhattan Bank N.A. and another 2 years as Executive Vice President for the International Treasury Division at Banco Sud Americano, an important local banking institution presently known as Scotiabank. In 1997, John’s entrepreneurial vocation led him to establish a recruitment, selection and search firm oriented towards middle management. During 1998 he successfully developed a professional training and development company (AbanSA) which represents Leadership Management International (LMI) and Vital Smarts. Since its origins, this senior management development company has delivered coaching to hundreds of Chile’s leading managers. Since January 2000, Mr. Byrne has led Boyden executive search activities in Chile. Boyden is a global leader in the executive search industry with more than 70 offices in over 40 countries. Boyden specializes in high level executive search, Interim Management and Human Capital consulting across a broad spectrum of industries.

www.search-consult.com For more information visit: Web: www.boyden.com

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OhMy:

TheImpact OfA Bad Hire Bad hires hurt. The immediate impact and the longer term repercussions can be felt in any size company, and a smaller organization or a department within a larger organization can be particularly hit hard. Evaluating the impact of a bad hire is not a pleasant undertaking; however, it does serve as a reinforcement of just how important the hiring process is to your client or to your organization. The specific impact of a bad hire will depend on the position involved, and it will vary from organization to organization. The review of an actual case may be helpful in determining the breadth and depth of the potential damage. One such case arose recently at a non-profit organization which we will call OhMy Museum or OhMy. A VISIT TO THE MUSEUM By most measures, OhMy Museum is a very successful medium to large size museum. For over 25 years, OhMy was a small institution with an outstanding, but limited, reputation. A few years ago and after careful study, the Board of Trustees and the Museum Director decided to triple the size of the museum. The implementation of this expansion has been very successful. In a non-profit organization, the Director of Development is responsible for all aspects of the institution’s fund raising activities. These activities include annual funds, capital campaigns, special events and other programs which seek the philanthropic involvement of the communities the organization serves.

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Approximately two years ago, the Director of Development for OhMy Museum announced his retirement. His replacement was very important to the continued success of OhMy, especially in light of the museum’s recent expansion. SEARCHING FOR A NEW DIRECTOR The Director of Development at OhMy Museum reports directly to the Museum Director, which for the purpose of this article is Mr. Jones. Mr. Jones has been in the museum business his entire career, and he has been at OhMy since its founding. Mr. Jones is very well known in the region, and he is involved in a variety of national associations and organizations; thus, he has a wide network of contacts. When Mr. Jones learned about the Director of Development’s retirement, he was determined to use his extensive network of contacts to find a replacement. He had over six months to find a new person, and, Mr. Jones did not want to pay a fee for any kind of recruitment service. The search for a new Development Director became much more difficult than Mr. Jones had anticipated. Given the large number of non-profits in existence, this type of person is in strong demand, and there are a limited number of candidates who can handle the Director’s role. After about four months, Mr. Jones found a candidate whom he deemed appropriate for the position; however, the Board of Trustees was not pleased because the candidate did not have enough relevant experience. Finally, the Board and Mr.

By Carl Taylor Jones hired a mutually agreeable candidate as the six month timeframe expired. The successful candidate had served as an instructor at a training seminar which Mr. Jones had attended several years before. It took a very short amount of time before things began to go wrong in the Development Department and related areas at OhMy Museum. The new Director, Mr. Adams, had a very assertive, abrasive style which was completely counter to the culture at OhMy. Over time, he alienated many of the museum staff, museum members, volunteer helpers and donors. After about 18 months, Mr. Adams was let go. WHAT WENT WRONG? OhMy Museum made a number of errors before, during, and after hiring Mr. Adams. The recruitment and assessment mistakes included: Lack of consensus on the position description and the person sought. Mr. Jones knew who he wanted in this role, and he did not seek input from the Board, the museum staff, or any potentially helpful museum members. Poor knowledge of the market for a new Director of Development. Mr. Jones and the Board did not appreciate or understand the increased demand for Development professionals or the level of effort required to find appropriate candidates. Inadequate and incomplete interview process and reference checking. The team which interviewed Mr. Adams and spoke with his references was not sufficiently knowledgeable about Development to ask

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the right questions and properly assess the candidate. In addition, they did not dig deeply enough during the interviews to satisfy the culture fit. Ultimately, rushing the selection of a candidate based on an arbitrary deadline. The self imposed six month recruitment period became more of an issue than finding the right person. After hiring Mr. Adams, Mr. Jones and the Board were slow to admit the mistake and correct the problem. HOW DID THIS IMPACT THE BUSINESS? As with any bad hire, some of the damage is quantifiable by calculating actual out of pocket expenses and estimating the impact of the person’s actions and/or errors. However, much of the damage created by a bad hire is not readily quantifiable, but this damage may be more detrimental and longer lasting to a business or organization. OhMy Museum suffered damage in a number of areas, including: • The direct costs associated with hiring, compensating, relocating and providing professional development to Mr. Adams. The museum will have additional direct costs as it works to correct its deficiencies and recruit a new Director. • The museum staff, especially those who worked for or near Mr. Adams, experienced a significant decrease in morale and focus and an increase in fear, worry and frustration - which led to lost productivity. The number two person in the Development Department resigned, and other staff members actively explored alternative careers. • The staff and those museum members, volunteers and donors exposed to Mr. Adams experienced an erosion of confidence in the leadership of the museum. A common question: “What were they thinking when they hired him?” • Many museum members, volunteers and donors were offended by

Carl Taylor

Mr. Adams’ actions - which substantially reduced their efforts and enthusiasm on behalf of the museum. In many cases, these negative impressions will be difficult to repair. In addition, a lot of rumors and negative information was communicated to people outside of the museum, impacting on future museum outreach efforts and programs. • Several donors did not participate, or reduced the amount of their participation, in various fundraising activities because of the way they were treated. In fact, one major donor has chosen not to fulfill a very large vocal commitment. The damage which can be readily quantified approaches $1.5 million, including cancelled contributions and known reduced levels of giving. The impact of the other damages will add substantially to that amount. These damages represent a significant multiple of Mr. Adams’ annual compensation which was approximately $120,000. LOOKING AHEAD OhMy Museum is in the process of finding a new Director of Development. At present, they are spending some time evaluating their existing organization and determining the person they truly need in

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this role. This is a good first step. This organization realizes that this hiring mistake will increase the challenge of identifying and attracting a new Director of Development. Candidates will need to be even more comfortable with the institution and its leadership before committing to take up this role. OhMy Museum is an outstanding organization, and it will survive this error and excel in the years ahead. Although it has lost a lot of momentum in its fundraising efforts, it will require time to repair the damage which has been done in its internal and external communities. This museum made a lot of mistakes in the recruitment, assessment and management of Mr. Adams. It is important to remember that it does not require numerous errors to make a bad hire; it can take only one. Don’t disregard the experience of OhMy Museum because it is a non-profit organization. Change museum members, volunteers and donors to customers, clients, vendors and investors, and the results can be easily the same in any business environment. Whether an organization uses external or internal resources to identify and attract its key management, the extra time, effort, and resources invested in this process will pay for themselves many times over. Carl Taylor is President of Carl J. Taylor & Co. He began his career in public accounting with Peat Marwick Mitchell (now KPMG), spent seven years in the management consulting division of Touche Ross (now Deloitte Consulting) and then two years as the National Director of Planning for the firm. He started Carl J. Taylor & Co. in 1987. Carl J. Taylor & Co. is an executive search and management consulting firm based in Dallas, Texas. Initially, the firm focused on serving professional services firms (management consulting, engineering, and public accounting). However, as his professional associates and clients moved to other corporate environments, Carl’s search practice has expanded to serve a variety of organizations with their senior level and oneof-a-kind search needs.

www.search-consult.com For more information visit: Web: www.carltaylorco.com

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Executive Hiring In Uncertain Economic Times:

Key Points Consider By Walter Rach

ith a troubled economy and the ensuing difficulties experienced by individual companies, executive hiring in 2009 has taken on a greater level of uncertainty. Hiring executives may feel additional pressure because, in these uncertain times, making a “wrong hire” can be especially impactful on the organization. Estimates vary on the costs that a company incurs when it makes a “wrong hire.” A study from The Corporate Leadership Council supports a relatively conservative number of three times an executive’s salary. At the other end of the spectrum, in his book Topgrading: How Leading Companies Win by Hiring, Coaching and Keeping the Best People, Dr. Bradford Smart puts the cost at an imposing twenty-four times the executive’s base salary. Nat Stoddard, in his book The Right Leader, estimates that the total cost to the U.S. economy for selecting the wrong leaders is approximately $14

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billion in cash, inefficiencies and opportunities foregone. As a company navigates through this business environment and identifies future talent for its organization, those responsible for making these decisions should consider a potential hire more carefully before they pull the trigger. The concern is that, if a new executive does not work out, it can truly damage a company that already may be especially vulnerable during stressful business times. Proceed with caution when it comes to hiring executives. The characteristics desired in a new hire now are not necessarily different than those considered in times of prosperity, but the scrutiny given to those characteristics should be intensified. Now is the time for companies to increase due diligence. Extra care, and time, should be taken to evaluate key areas of concern and ensure culture fit with the organization.

POINTS OF CONCERN: Culture Fit: Achieving a strong culture fit with a new executive hire is always important, but it may be even more critical during these economic times due to leaner management teams tackling increasingly difficult business conditions. Now, more than ever, hiring leaders need to examine how the new executive will interact and work together with the existing leadership team to accomplish company goals. Companies also need to honestly assess their own organization’s culture in order to critically evaluate whether the new executive’s character, values and energy level is a match. According to Zach Wochok, the CEO for PGP International, “Culture fit is still the top priority. With a top tier search firm you can feel comfortable that the screening process will result in the presentation of highly-qualified candidates and a relatively good consideration that fits the organization. However, the latter

cannot be fully assessed until your own team has the opportunity to meet and evaluate the candidates.” Loyalty and teamwork are essential to success right now. Spend a little more time having the prospective new hire meet with other key management team members to determine compatibility. Some companies have found that group interviews suit this purpose well. Finding the right fit at a time like this means more involvement of key managers in the evaluation process, particularly with senior level positions. Listen carefully to what the others have to say and allow them to help you evaluate the fit. Make sure that the hiring leaders ask the candidate for past examples of reaching out beyond their own functional area of expertise to understand and collaborate with other members of the executive team. Big-Picture Thinking with a Bottom Line Approach: Now may not be the time for executives to focus solely on their area of specialty. In addition to having functional excellence, the new executive also needs to have the ability to understand the business as a whole and to comprehend how his / her decisions will impact the overall growth and profitability of the organization. Hiring leaders should ask the candidate to provide examples of doing more with less, and improving the bottom line. As companies are looking at processes and profitability, the hiring leaders should assess the skill sets, experience and expertise of the candidate, and how these attributes can add value and help the company move forward. Companies would be wise to scrutinize the environment and circumstances in which a candidate has had success against those that are present in their own organization. For example, if a candidate has demonstrated

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success in an organization with a certain level of resources, support and structure, can he / she replicate that success in another company where the degree of those levels might be very different?

Walter Rach

ADDING VALUE Within this context, executive search professionals can add tremendous value to their clients during this time of uncertainty by taking heightened steps to better identify executives that more closely match the needs of the position and the fit of the organization’s culture. First, more upfront questioning and research needs to be done with the client to truly assess and identify the nature and requirements of the position and to obtain an accurate assessment of the company’s culture. Second, more thorough interviewing and referencing need to be done with the candidate to assure that the “right hire” is identified. Finally, additional value can be added to the client in the form of recommendations and assistance with onboarding, periodic evaluations and executive coaching to monitor and ensure

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the success of the newly hired executive. During these challenging times, companies are cutting budgets and declaring hiring freezes. Many talent experts caution otherwise. In fact, this may be the right time to invest in talent. In fact, executives that companies hire now have the opportunity to make a significant, positive impact on the organization long-term. Tough times can be the best breeding ground for innovation, efficiency and rapid improvements. By taking the time to examine the candidates a little more closely now, companies can minimize their own risks and reap the rewards for years to come.

Cook Associates, Inc. is a retained executive search and buy-side M&A advisory services firm. Our core business is creating value where talent and opportunity connect, and we are uniquely positioned to help our clients capitalize on the brightest talent and best performing companies in the marketplace. Our client base ranges from multinational corporations to early stage entrepreneurial companies, private equity and venture capital firms. Walter Rach, Managing Director for Cook Associates Executive Search, directs the Food & Beverage sector. Since joining the firm in 1983, he has specialized in driving search strategy programs and complete search project management and execution for Food Processing clients. Walter has built a strong following in the Food Industry and has successfully conducted search assignments for senior level executives for Fortune 500 companies as well as publicly and privately held firms of small to medium size. As a Managing Director, Walter conducts executive search assignments at the CEO, COO and divisional President levels as well as functional heads of Sales, Marketing, Operations, Supply Chain, Finance, Technical Services and Human Resources for the all Food & Beverage industry segments.

www.search-consult.com For more information visit: Web: www.cookassociates.com

ISSUE 36 2009 search-consult

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Recruiting

In Emerging Markets F

or most of us in the executive search business, the ongoing global crisis is a major threat. It’s in times like these that big, established retained search firms go out of business. And many of those who don’t go out of business, in order to generate the cash flow necessary for survival, cut their fees or take on contingency assignments; thus damaging their brand and longterm growth prospects. But then again, for some of us the ongoing global crisis is also an opportunity. Apart from the obvious usefulness a huge downturn has in weeding out the competition and allowing the rest of us a bigger piece of the pie when the market bounces back, the potential to grow, even in a weak market, exists. You just have to find it. For multinational firms and networks with an international presence, a good place to start looking would be emerging markets outside of North America and Western Europe. According to Jyorden Misra, Founder and Managing Director of InterSearch Worldwide’s partner in India, “the pink slip syndrome is evident in India in the financial services, media, retail and aviation sectors, but more worrying are the hiring freezes that occurred across many industry segments in 2009.” Misra, however, says that even in such an insecure environment, the Indian market still offers many opportunities to executive recruiters

search-consult ISSUE 36 2009

By Harris Karaolides *

who operate in certain niche markets like microfinance and social development, as well as in sectors such as infrastructure and biotechnology.

Harris Karaolides

Over these last years, the Indian market has been evolving at a much faster rate than the developed markets due to a boom in foreign investments, an unprecedented increase in M&A deals and a large number of Indian companies acquiring a global footprint. This has brought with it global management trends and a huge interest in human capital management, and this is not something that goes away just

because of a recession. India is indeed a very promising market for executive search, even under the current difficult conditions. Other emerging geographical markets for executive search, such as some of the “new European” countries of Central and Eastern Europe, are suffering more in 2009 since banking and the automotive industries – key sectors in this region – have been hit hard. For a search network, nevertheless, having a presence with numerous offices across the CEE region definitely helps develop business during a recession. Andras Lipcsei, Managing Director of InterSearch’s Budapest office in Hungary and a member of InterSearch Worldwide’s Board of Directors, explains that the number of client requests leading to cross-border business referrals among network partners within the CEE region is steadily increasing. According to Lipcsei, the pharmaceutical and life sciences industries, as well as some subsectors of the financial industry like factoring and debt collection, show tendencies for growth. In addition, local and multinational companies in the CEE region have a lot of catching up to do regarding environmental protection, so this is another area presenting opportunities for recruiters. Lipcsei also explains that there is a healthy demand for new services in the CEE region as executive

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search providers begin to diversify their services to include management audits and talent management, offsetting some of the revenue lost from the slowdown in executive search assignments that usually occurs during a recession. Latin America, on the other hand, seems to have a proven capacity to generate and sustain high growth, even during periods of serious financial and political instability. Patricia Epperlein, current President of InterSearch Worldwide and a Brazilian native, provides an interesting fact: “Brazil was, until very recently, a country where some were rich and the rest were extremely poor, but today there is an upward migration of millions of Brazilians into a newly created middle class. Despite the global crisis this particular socioeconomic segment will continue to grow, consume and lead the country’s growth.” According to UNCTAD (the UN’s Conference for Trade & Development), Brazil’s share in the world’s direct strategic investment grew to 2.4% during the 1st Quarter of 2009 versus 1.9% for the same period the year before. Mr. Darwin Dib, Chief Economist of the Itau/Unibanco financial conglomerate, recently forecasted a new order in the flow of global investments, with higher volumes destined to emerging markets, especially those which, like Brazil, not only consume increasing amounts of global goods and services but also export a growing share of raw materials used in global manufacturing. Also, according to JP Morgan and BNP Paribas, Brazil’s 36% share of Latin America’s Gross Domestic Product grew by 4% in recent years and is expected to grow by almost 1% in 2010 alone, even with a -0.5% decline in the world economy in the post-crisis period. It is no surprise then that Brazil has already attracted most of the world’s Top 20 executive search firms and global networks. Epperlein confirms that “despite the uncertainties of the crisis, Latin America remains a fertile and profitable option for investments in 2009 and beyond. For companies already doing business here

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and for new companies seeking growth and diversification, there will be more opportunities here than in the developed markets.” In other words, global executive search organizations with a solid presence in Latin America will probably suffer less than others that only do business in North America, Europe and Japan. LOCAL PRESENCE IS CRUCIAL It’s not only a matter of some regions suffering less than others. If you brand yourself as a global search firm, you need to have a local presence in all regions. Even in the age of Internet, virtual social and professional networks and everyone and their dog knowing how to google, chances are an executive search consultant will do a better job recruiting a senior manager for a Ukrainian organization if she is based in Ukraine than if she’s doing most of her business somewhere else. Despite a globalized economy a manager still has to be familiar with the local culture. She has to be able to adapt the company philosophy to local customs and circumstances, in the same way that many successful multinational food manufacturers adjust the flavor of their standard products and brands to local tastes. A Western European consultant not based in Eastern Europe will find it very hard to recruit candidates with the creativity and stamina required to bring effective results in a down market. Especially in these times, when top management is more cost conscious, clients should think twice before sending an expensive expatriate with a learning curve ahead of him to an emerging market. Another reason why a search firm’s local research capacity and interviewing style adjusted to local norms is highly appreciated. Having a physical presence in the emerging market where your client is about to expand makes it easier for your firm or network to convince the client that you really know what he needs so he’ll retain your services for that nice, fat Country Managing Director search project. “Executive search consultants working in emerging markets must have a

solid understanding, not only of their local economy, but also of the key functions and characteristics of the global marketplace in order to bridge the gaps between business opportunities and their region’s pool of corporate leadership,” concludes Patricia Epperlein. Setting up new offices or recruiting new network partners in emerging markets might not seem like a priority during a recession, but it is a smart move for those who dare risk it. This is a positive move in the short-term since this might be the only way you have in 2009 and 2010 to bring numbers comparable to those you had in the previous years. Furthermore, when the dust settles, a few months or even a couple of years down the road, you will have a significant competitive advantage in the global marketplace. You will have established a partnership with local offices in the emerging markets, you will have the necessary expertise and know-how to be effective, you will have access to a new pool of candidates and, more importantly, you will gain access to a new set of clients who will work with you in selecting the best candidates. Having a solid presence in emerging markets will help you develop your business, increase client referrals, build your brand and, most of all, offer better service to your clients. After all, offering better service is what all of us should be striving for. * Contributors to this article: Patricia Epperlein, InterSearch Brazil, Chairwoman of InterSearch Worldwide, Andras Lipcsei, InterSearch Hungary, Jyorden Misra, InterSearch India

Harris Karaolides is Managing Director of InterSearch Greece. He is also responsible for InterSearch Worldwide’s Media Relations. He can be contacted at H.Karaolides@intersearch.org. InterSearch Worldwide is a global network of search firms consistently ranked among the largest retained executive search practices in the world. InterSearch is currently represented in more than 40 countries, staffed by local professionals selected for their experience and reputation in their own markets and their ability to operate internationally.

www.search-consult.com For more information visit: Web: www.intersearch.org

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