search-consult Issue 26 by margaret jaouadi

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2006 / ISSUE 26

The International Executive Search Magazine Published by Dillistone Systems

The Perfect Match: How to Ensure a Successful Hiring Process

Restrictive Covenants Recruiting Technology: Aiding, Not Replacing, the Recruiter Executive Search in Russia: Exploring the Possibilities ALCOA in Russia: Learning to Adapt

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Employment:

Restrictive

Covenants

By Michael J. Revness HE PERFECT WEEK? T h e Pe r f e c t We e k b e g i n s Monday morning when John a highly compensated employee contacts you (an Executive Recruiter) looking for new employment. John is well educated and has received specialized training and skills through his current employer (“OldCo”), which are in high demand. John has, through support from OldCo, developed personal and professional customer relationships and has a nice “book of business.” John has, through OldCo, created business forms and customer lists which give OldCo a competitive edge. And, John has helped to develop OldCo’s marketing plans and strategies, which have proven to be a great success in a highly competitive industry. Tuesday, you receive a call from an emerging company (“NuCo”) looking to hire a new employee; John is a perfect match. NuCo is a chief competitor of OldCo. We d n e s d a y, y o u a r r a n g e a n interview between John and NuCo and it is love at first sight; a match made in heaven. Thursday, all the stars having

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perfectly aligned, you are authorized by NuCo to make an employment offer to John for more compensation, benefits and opportunity that OldCo offers or can offer.

Michael J. Revness

Friday, John calls and authorizes you to accept NuCo’s offer on his behalf. As you are congratulating John, calculating your commission on the calculator on your desk and planning your celebratory trip to Italy, John

advises – “I forgot to tell you that I signed a employment contract with my current employer which contains Post Employment Restrictive Covenants.” Has the perfect week just fallen apart? Will your trip to Italy have to wait? What are Post Employment Restrictive Covenants and are they legally enforceable? POST EMPLOYMENT RESTRICTIVE COVENANTS Po s t E m p l o y m e n t R e s t r i c t i v e Covenants (“Restrictive Covenant”) is a legal term used to generally describe the four different ways in which an employer can legally continue to control and haunt an employee (and your commissions) well after the termination of the employment relationship. At early common law, Restrictive Covenants were disfavored as illegitimate restraints on trade. Afterall, Restrictive Covenants can prevent an employee from practicing in his trade or skill, or from utilizing his experience in a particular type of work with which he is familiar. Moreover, the employee will usually have few resources in reserve to fall back on, and he may

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find it difficult to uproot himself and his family in order to move to a location beyond the area of potential competition with his former employer. To d a y, h o w e v e r, t h e l a w h a s changed. Under the law of most states, Restrictive Covenants are enforceable so long as they are reasonable in time and geographic scope, supported by fair consideration, and ancillar y (related) to the employment relationship. THE FOUR RESTRICTIVE COVENANTS Although the non-competition covenant is the most common Restrictive Covenant, there are actually four different forms of Restrictive Covenants, each intended to serve a different purpose and separately protect the employer’s interests. 1. The Non-Competition Covenant. This covenant, the most broad of all Restrictive Covenants, prohibits the employee from competing with his former employer within a certain geographic location for a period of time after termination of the employment relationship. The noncompetition period is usually 1 to 2 years and applies whether the employer or employee terminates the employment relationship, with or without cause. The covenant typically prevents the employee from starting a competing business or going to work for a competing company. Generally, the covenant must be ancillary to the employment relationship and supported by adequate consideration. New employment, or a material change in the terms of current employment (more compensation, bonus, more benefits, additional material responsibilities), is typically adequate consideration. Continuation of an “at will” employment relationship is often not adequate consideration. The purpose of this covenant is to protect the employer’s competitive edge in the marketplace.

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2. Non-Solicitation Covenant. This covenant prohibits the employee from soliciting or accepting business from the employer ’s customers (or clients) to engage in competitive business. It applies even if the employee was wholly, or partially, responsible for developing the customer during the employment relationship. This covenant is less broad than the non-competition covenant in that the employee is not restricted from competing with his former employer; rather, the restriction applies to soliciting or accepting competitive business from employer’s customers. To be legally enforceable, this covenant must likewise be ancillary to the employment relationship and supported by adequate consideration. The purpose of this covenant is to protect the employer’s investments is perhaps its most important asset - its customers. 3. Non-Pirate Covenant. This covenant prohibits the employee from soliciting the employer’s other employees to work at the employee’s new place of business. Again, to be legally enforceable, this covenant must likewise be ancillary to the employment relationship and supported by adequate consideration. The purpose of this covenant is to protect the employer’s investment in its employee base. 4. Non-Disclosure Covenant. This covenant prohibits the disclosure of confidential information, irrespective of whether the information actually qualifies for trade secret protection. It typically applies to customer lists, customer contacts, marketing and business strategies and plans, financial projections, business forms, and pricing formulas. Like all the rest, to be legally enforceable, this covenant must likewise be ancillary to the employment relationship and supported by adequate consideration.

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The purpose of this covenant is to protect the employer’s investment in its business information. WHAT DOES ALL THIS MEAN TO THE PERFECT WEEK If John signed a Non-Competition Covenant, Non-Solicitation Covenant or Non-Disclosure Covenant with OldCo, the Perfect Week may have come to a crashing end. John’s acceptance of employment at NewCo may very well put him in violation with one or more of the above Covenants subjecting him and NewCo to expensive and arduous litigation. Moreover, the results of that litigation may very well be a Court Order prohibiting John from working for NewCo. Consequently, in all likelihood, NewCo will not hire John, you will receive no commission, the trip to Italy will have to wait, and your hard work may be for nothing. The lesson to be learned... Restrictive Covenants are generally enforceable under the laws of most states. Therefore, before spending your time and resources marketing a new candidate, first find out if that candidate signed any Restrictive Covenants with his current or former employer. Then, closely scrutinize those Covenants and advise your candidate to do the same. If your candidate signed Restrictive Covenants and they are enforceable under the laws of the applicable state, the reality is that your time and resources may be better allocated elsewhere. Have a Perfect Week. Mr. Revness is a Founding Partner of boutique business law firm Kurtz & Revness, P.C. For more information, contact Mr. Revness: www.kurtzrevnesspc.com. www.search-consult.com For more information, contact: Web: www.kurtzrevnesspc.com

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The Perfect Match:

How to Ensure

a Successful Hiring Process

By Pilar Gumucio r X was a very successful CEO in a multinational firm in the retail industry in the USA. His achievements included doubling profits, opening new markets and consolidating the company’s market leadership. Six months ago Mr X was hired by an Asian company, with the hope of replicating the same levels of success. However, yesterday he resigned without accomplishing what was expected. Like Mr X, there are many successful top executives who fail when they change environments. Why is this continuing to occur? How can a company be sure that it is hiring the right executive? How can an executive know if the role offered is right for him or her? Clients and candidates are both becoming more aware of this uncomfortable scenario, as search consultants must look for ways to ensure a long lasting and perfect match. search-consult has interviewed six leading search consultants and one expert on leadership development to explore this issue, and see what they advise to ensure the right fit.

WHAT WENT WRONG? David S. Harap, Partner and Global Practice Leader for Healthcare & Pharmaceuticals for Stanton Chase International, explains that in today’s fast-

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paced and highly competitive world, results are expected to be delivered quicker than before. In fact, the quarter-to-quarter mentality is compelling companies to show immediate impact, placing more pressure on executives. “The need to drive change in an organisation is a real challenge as Emotional Intelligence is fundamental to determine if the new executive can adapt to such a fast paced and dynamic environment,” states Pierangelo Favero, Managing Partner of AIMS Italia Management Consulting. Harap adds: “Board of Directors and senior management teams are putting new

Pierangelo Favero

executives on a much shorter leash… There really isn’t much patience for a learning curve. They want to see them hit the ground running and make almost immediate results, and sometimes that is simply not possible.” By focusing only on the short term objectives companies are often ignoring long-term solutions, which are equally as critical. Jan Olsson, Managing Director of Lisberg Executive Search, which is part of IMD, reports how sometimes unsuccessful matches are made when the company, and/or the search firm hired, did not elaborate a proper job profile. As a result, the candidates selected in the final round were not suitable and did not meet the client’s expectations. As the world becomes more international new scenarios are being explored, as new roles must be tailored to meet these new opportunities and challenges. Yet, in this new context, Olsson explains how “CEOs are simply not given enough time to adapt as companies today have high expectations for fast growth and ever-increasing results.” Andrew Walker, Managing Director of Ashley Harvey Associates and founder, Director and Joint President of The International Executive Search Federation, describes how a candidate’s success is dependent on whether a client is fully aware of good management practice in the area

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they are operating in. For example, what is considered good management practice in the US might be the primary reason why an executive fails in Asia Pacific or Europe.” In fact, Kris de Jager, founder and CEO of de Jager & Associates and Vice Chairman of IIC Partners, provides a perfect example of how a company’s cultural environment can affect a candidate’s level of performance. “We recently placed a CEO in a Korean company,“ he reports. “The successful incumbent came from another Asian organisation. We all believed that the cultures were very similar, and nothing was further from the truth. The executive is finding it very hard to understand those cultural issues, which are critical to how people do business and set their expectations.” According to Penny Ferguson, CEO of Penny Ferguson Limited, there is a greater demand on executives to raise their leadership abilities and broaden their horizons because “the mark of outstanding leadership is not just how good a leader you are, but how many leaders you develop.” She explains how executives are expected to not only be successful in one area, but also be able to expand their knowhow to be able to effectively develop others. This factor is crucial, especially if they haven’t received the proper training to do so. De Jager describes how mismatches often occur when an executive changes industries. He elaborates: “A classic example is when an executive from an important distribution business (where the focus is very much on sales and marketing) is hired and is expected to perform in the service industry (which is very much focused on client relationships). These executives quite often can’t make the switch because the experience is different” as the skills and mindset required will differ as well. Another reason why some top executives succeed in one environment but can fail miserably in another is the quality of the team and support structure that is in place. De Jager explains: “You may come into an organisation having previously had very strong financial support. This new organisation may have a weak financial director and if you are weak in finance this leaves you vulnerable, and can often lead to failure.”

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Kris de Jager

Another important problem arises if the new executive does not have the full support of the team he or she will be working with. Sometimes this occurs because internal candidates resent the appointment. The end result is that the executive feels isolated, and therefore, is starting the job with a serious obstacle. Christine Greybe, Managing Director, Asia Pacific for DHR International, explains that companies, more often than they would like to admit, don’t provide the incoming executives with the necessary tools to integrate themselves better, which may greatly contribute to the executive’s failure. “In some cases,” she adds, “the executives recruited have been promoted and therefore, have taken a step up without receiving the adequate training to support them.” This issue will obviously affect their performance levels. LOSING FAITH, MONEY AND A GOOD REPUTATION In effect, mismatches hinder a company from achieving its desired goals, and have a direct impact on its bottom line as it increases its turnover rate for key roles and can drop the share price as confidence levels diminish. As a result, the company can lose millions, as its reputation and ability to attract top talent can be seriously hampered. Within this context, Walker explains how a wrong hire can be expensive and disruptive

for the client. At the same time, it can hinder a search provider’s reputation. “If a professional job has not been conducted by the search firm, then surely they will not be asked to do another assignment for the client.” By the same token, if a client has made the wrong hiring decision despite the search consultant’s advice to do otherwise, then should they be held accountable for this mishap? Greybe describes how companies are placing a lot of pressure on search firms to take more responsibility for the selection. Nevertheless, she insists that the ultimate hiring decision is made by companies and therefore, they are the ones that are ultimately responsible for making sure that the selected candidate is fully integrated into their business. “Hiring the right executive is only part of the process as clients often neglect the onboarding process in executive hiring,” reports the DHR executive. “This aspect is fundamental… We can bring in the right people, but we cannot integrate them. This is the company’s responsibility.” According to Favero, “as companies become more sensitive and aware of bad hires, they are more distrustful and are seeking assurances from their search providers throughout the entire process.” For Harap, any time there are a series of high profile failures, “it makes a company or board second guess their decision to launch a search, as they will really consider internal candidates more intensely.” He describes how “companies are launching formal searches to be diligent,” but virtually from the start you can see their inclination to promote an internal candidate because it’s a safer path than bringing in an outsider. Companies are also broadening their search methods to recruit talent as they look to online recruitment as a means of expanding their existing talent pools, reports Jan Olsson. De Jager reports that searches are taking longer because the process involves sourcing candidates from a much wider industry base. Globalisation and technology have played an important role in allowing this information to be readily available, and

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search consultants must use this information wisely. Olsson describes how companies are being more meticulous when they select their search providers. At the same time, search firms are also being more selective with their clients. De Jager strongly believes that search consultants should only accept assignments that they are confident that they can successfully execute and add value. “The ability to say no is just as critical.”

Penny Ferguson

ADVISING CLIENTS Ironically, companies are spending more money on assessments, talent management, and leadership development than ever before. Nevertheless, businesses continue to make bad hires. What should clients do to minimise the risks? Greybe advises clients to review their selection process, “understand where the challenges in the past occurred, and have in place a clear onboarding process that is regularly reviewed and updated.” “Most companies have a selection process, but it was established a decade ago and therefore, does not effectively reflect today’s requirements,” she states. Harap explains that companies are often “too focused on a company’s brand, instead of focusing on the actual executive that is being interviewed. Although the name of a company is important, it should not be the

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primary criteria in selecting the right candidate for a new role. GE is a classic example. Everyone wanted GE alumni but if you really take a hard look, you will see that it has a mixed track record.” According to Favero, clients should really partner with their search providers, listen to their advice, especially when it comes to assessing candidates since they have a lot of experience in this subject. KNOW WHAT YOU LOOKING FOR Harap advises consultants to “make sure they have clarity before they even launch the search.” For him, the client should have a clear understanding of the short term and long term objectives before fulfilling a role. “If you don’t know what you are looking for at the beginning, it’s hard to assess if the candidate has it when you are in the final selection.” Olsson agrees, as he says that clients are becoming more aware of the importance of the “pre-work” that must be performed so that both parties fully understand the job profile, the skills and the cultural fit that is required. To be able to effectively obtain this understanding, extensive research must be thoroughly conducted. Harap reports how the first two weeks have to be invested in talking to the client and making sure that their expectations are in calibration with what the marketplace offers. He adds: “This is the time when you modify a search, instead of waiting 6 weeks when you are presenting candidates and there is a mismatch.” De Jager describes the importance of spending “quality time in taking a comprehensive brief that covers the industry, the organisation, any issues that the organisation is facing, long term business plans, organisational structures and specific requirements for that role.” Extensive discussions with the client are fundamental, reports Olsson. “Make sure that the conclusions made are written so it is clear for both, the client and the consultant, on the type of executive the client is looking for. This implies more than just preparing a brief. Ferguson insists that what is crucial is

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to help your client fully understand how they “are going to get the new executive really embedded into their organisation.” She also cautions consultants to review who is providing the brief since “that person will provide an accurate brief from where he or she is sitting at that time. As a result, it is vital that you, as a search consultant, do not take the brief on face value.” De Jager notes: “From a management point of view, it is critical that the search consultant needs to understand all the issues the new executive will face: bad, good or indifferent. It is fundamental that consultants also “have a full understanding of why the previous executive left the organisation, and make sure that they are not bringing the same mistakes on board.” Ferguson recommends search consultants “discover what is really happening in their client’s organisation by meeting the executives that the incumbent is going to report to, get to know the executive’s colleagues, meet the people that he or she will be managing, and even spend a day in the organisation to get a feel of what is really occurring within the business.” This will increase the chances of providing a list of suitable candidates. MATCHMAKING Once the competencies have been determined and a list of successful candidates has been elaborated, consultants then proceed to match the executives’ personal values with those of the organisation’s. Favero describes how clients are demanding that search consultants do more to check that the executive really has the right fit. “Providing CVs/résumés and the right profile on paper is not enough as part of our role is to guide the client and help him make an informed hiring decision. As a result, we have to place more emphasis on a candidate’s personality traits, motivations and attitudes since these factors are what can lead to mismatches.” According to Walker, what are often overlooked are: the cultural environment in which the company finds itself, the executive team profile around the incoming executive and the human resources that they will have at their disposal.

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He elaborates: “British Airways and Virgin Atlantic both fly long haul, but I think both organisations would agree that they have totally different corporate cultures. It is not just that they both provide good service to their customers – a successful executive joining either or would be joining a completely different cultural experience – some would thrive, some would not.”

Jan Olsson

This is the aspect of the hiring process that search consultants must add value by helping their clients differentiate which candidate would fit better; and thus, be more productive in the short and long term. Clients tend to focus on evaluating the professional fit, checking the competencies, knowledge, and the experiences required, says Favero. Nevertheless, the executive’s cultural fit, values, and attitudes are what determine if there is a perfect match. This is probably the most challenging part of the job, but at the same time, it is the most critical. De Jager explains how search consultants are looking at the candidate’s fit. They are not only looking at skills and experiences, but at the cultural fit as well as the Key Performance Indicators of the role. He describes how consultants should also look at their client’s organisation by looking at the ongoing support, the quality of the team, the prospects in the organisation as well as the ability for personal reward. “If the candidate’s personal values match

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that of the company’s, then you have a perfect match”, remarks de Jager. “If they are not in agreement, then you will have problems. It is vital that you make sure that the competencies are correct, the skill sets are there and that the person has the right empathy that fits the culture of the organisation.” In other words, it is the softer skills that have to be taken into account. As Harap notes, what is critical and hard to assess are all these issues that won’t show up in a résumé, but are the driving force to their success, such as: What led to the executives’ success? How are they viewed by their team? Did they do well in mentoring? That brings to the frontline the importance of Emotional Intelligence in the evaluating process. This concept indicates an executive’s abilities to know and work effectively with his or her own emotions, be able to recognise emotions in others and also adapt well to changing circumstances. Ferguson describes how “everything links into Emotional Intelligence. You recognise its importance and how it helps define the way you work with people, the way you lead and the way you communicate.” Harap explains how it is of vital importance but at the same time, is also hard to quantify, and therefore, include in the assessment report. Nevertheless, consultants must find ways to measure it and then convey this vital information to their clients. In the selection, explains Olsson, consultants should use references, interviews, case studies, as well as personality and IQ tests. Greybe agrees as she explains that the use of certain tools helps quantify the cultural fit so that the information is not only subjective, but complements all the data that you have collected. This assessment will help to highlight the candidate’s strengths and weaknesses. Furthermore, if the client selects the candidate, the client is fully aware of what support the candidate needs from the very start. Having this information in hand can save quite a lot of mistakes and misunderstandings, helping match the client and candidate more accurately. Greybe states that there are a number of interviewing techniques consultants

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Christine Greybe

incorporate to help them in their assessment. The more time you spend with the candidate, probing and getting a better sense of their Emotional Intelligence and their leadership and management styles, the more information you will have to assess if he or she is a good fit for your client. QUALITY TIME WITH CANDIDATES According to de Jager, consultants also have to be close to the candidates “since they are just as important as the clients.” This opportunity is essential to obtain a better understanding of the candidate. In the final selection stage, Harap explains that it is vital to spend quality time with every candidate “because a superficial interview will only get you so far. You may understand some of the hard issues, but you will not be able to really appreciate their softer issues.” He continues: “You need to be able to put their success in the proper context and to be able to see if the candidates really have a good potential fit with the client. Someone may have an impressive résumé, but you have to probe and understand exactly what the factors that led to that success are.” During the interview phase, it is fundamental that consultants add value by helping the client make an informed hiring decision. “The effective interview skills are not always part of the background of managers as they tend to jump to conclusions and rely

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Recruitment. Get it right first time.

Here’s what a client had to say about us. “Put simply, CFR efficiently delivered the world-class service expected by Netjets.” ‘Here at Netjets - Europe’s leading private jet operator and pioneer of fractional jet ownership – we appointed CFR just over a year ago to recruit ten new Vice Presidents to manage challenging sales programmes following an expansion of our services in Europe. As an organisation we’re committed to offering our customers an exceptional standard of service, 100% of the time. That’s why we looked for consultants who could offer a quality of service that mirrored our own.

Rather than working with an international agency with sub-offices across Europe, we were clear about wanting a single, European based entity with the ability to manage all territories and present a short list of suitable senior executives. In CFR we found what we were looking for. They made the recruitment process completely painless for us, identifying and processing over 2,500 applicants across all key European territories. CFR’s selection process was, and continues to be, rigorous and well-judged. It has resulted in the appointment of a series of excellent VPs who are, at this very moment, successfully managing sales programmes right across Europe.’

Here’s what we have to say about ourselves. Professionalism. Experience. Strong ethics and a very different approach to service. These are the qualities that make CFR unique and ensure we hit our clients’ recruitment targets first time. When your business needs expert executive and management search and selection services, anywhere in Europe and beyond, CFR can meet all of your recruitment needs. You can rely on our consultants providing the quality and continuity of service your business demands. There are no short cuts to a successful assignment and

that’s why we insist on taking the time to understand your organisation and the way you work, before starting to recruit. We wouldn’t have it any other way. It’s the secret behind our ability to cut the risk of making an unsuccessful appointment to almost zero and our leap into Search Consult Magazine’s ‘Top 20 largest search firms in the world.’ For more information about how we can help your business recruit the right people, first time, call +44 207 729 0929 or see www.cfr-group.com for details of all our offices in Europe and beyond.

Austria • Belgium • Czech Rep • France • Germany • Hungary • Italy • Netherlands • Poland • Slovenia • Spain • Sweden • Switzerland • UK & China With over 100 professional consultants, in 31 offices and an additional presence in South Africa and USA

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on gut feelings. It is our job to already have a good understanding of the candidate and probe further to make sure the best candidate is selected by following a step-by-step process,” states Favero. At times, this may mean pointing out the candidate’s strengths and weaknesses, making sure this feedback get across to the client organisation. Greybe provides an example: “I was performing a search in Japan for a client that had initially selected candidate A. I thought candidate B was a better culture fit so I discussed this with them, and we compared both candidates with the evidence presented. I gave them the facts so that they could make a more informed decision.” Other times, it may mean facilitating the internal discussion among the interview panel that will lead to the final hiring decision. Ferguson remembers that when she was in recruitment years ago, a candidate came in to be interviewed. “He was arrogant and self opinionated. When I asked the client for her feedback, she responded that the candidate was ghastly. I told her to put her feelings aside and to look at the way he answered the questions.” “On that basis, he was the best fit, “she explains. “Did the client have difficulties with his personality? Yes. Did the client have concerns with his performance? No, we were both absolutely sure he could perform. In the end, she decided to take a chance and hire him, working with him to change some of those behaviours that were not so attractive. Two years down the line he was considered one of the best executives they ever had.” According to Harap, “you have to drive the discussion forward because that is the only way to ensure long term success with that placement. It’s not racing to the finished line and get the search closed as quickly as possible, it’s making sure you get the right candidate who will have the biggest impact, both in the short and long term.”

incorporate as part of our reference checking, “states de Jager. For Ferguson, reference checking is essential to verify all the information you have collected. As a result, make sure you are proactive. “Don’t just write to the referees, phone them up, meet with them and use anything and everything you can in a constructive way to find how the candidates behave, who they are as people, what are their values.”

IT’S A CHECKING GAME Along with the interview, clients are placing greater emphasis on reference checking. “Any issues that the client or candidate raised during the interview process we

IT’S THE CANDIDATE’S TURN At the same time, candidates want to know the issues, they want to know why the previous person left and what the client’s expectations are so that they can analyse and see if the offer is in their best interests.

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Andrew Walker

According to Harap, “this is very challenging, but probably the greatest tool to use to assess a candidate and their potential fit into a new organisation.” He adds that 3 or 4 references are no longer acceptable. Clients want to see a much broader breadth of reference checking. They demand references not only from their organisation, but also from vendors and suppliers. They demand information not only from the executives that the selected candidate reported to, but from colleagues and individuals that reported to him or her so that they have a better picture of that person’s hard and soft skills.

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Providing candidates’ feedback is just as essential as providing feedback to the client. Greybe indicates that throughout the entire process, it is vital that search consultants not only provide more information to the candidate, but also be able to feed that information back to the client. “We must help them understand what the candidate wants and what his or her concerns are.” Whether the candidate is successful or not, it is important that the candidate gets constructive feedback, explains Olsson. They should at least walk away with a better understanding of themselves, knowing what their strengths and weaknesses were. Did they have the right skills? Did they have the right cultural fit? Did they have the right attitude? This is all part of Emotional Intelligence, which is just as important to them as well as the client. If the candidate is successful, he or she must understand not only the culture and the environment they will be going into, but also the team they will be managing and what kind of boss or board they have to report to. De Jager insists on the importance of providing feedback, especially after the placement has been made to make sure that the candidate and client are continuing to have a productive relationship. If there are any concerns, he facilitates meetings to help both the new executive and the client, state their concerns and see the best way to resolve them. This may range from the executive changing certain behaviours, to putting in place coaching and mentoring programs. If all these steps had been followed, Mr. X probably would still have been able to successfully add value to the organisation that hired him. As search consultants, it is vital that you have a permanent dialogue with your client and candidate to ensure that in each assignment you are able to obtain the perfect match. www.search-consult.com For more information, contact: Web: www.search-consult.com

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Recruiting Technology:

Aiding, Not Replacing, The Recruiter By Scott Molski growing trend in the recruiting technology market place is software and services designed to minimize the recruiter’s time spent with candidates, especially early on in the process. While these will certainly save time and money for the recruiting firm in the short term, recruiting has been, is, and always will be about people-to people relationships. As such, it is fundamental that any technology should aid the recruiter so that they spend more time with candidates, not directing candidates to a faceless, "grind ‘em in-spit ‘em out” system. The most common area where candidates are placed in front of machine instead of man is the initial contact with the search firm/corporate HR, particularly candidates that aren’t targeted by the search firm. Many

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search and recruiting firms and nearly all companies have a web presence that encourages people to submit their information through an often lengthy process. Next usually comes an automated response by email. Maybe some emails will go back and forth if the candidate meets an automated or human-screened criteria and finally there may be the initial phone call. Why do firms take this faceless approach to the write-ins? The most common answer seems to be that any other approach will take too much time and thus cost too much money. And, yes, a recruiter’s time is very valuable because they are off targeting and sourcing candidates put on their screen by past experience and at their client’s actual or inferred request, both of which are extremely

important and fundamental to the search process. But don’t unsolicited résumés just clog up my inbox and trash? Traditionally, and still today, that is the view, and there is a good amount of truth in it. However, more and more search firms and corporations are putting their position descriptions and also building web sites that allow executives to submit their details even the AESC encourages executives to submit their information to them online so that all retained search firms can access their profiles. Now is when technology can come in to aid, not replace, the recruiter. How do we still filter out the junk but capture and build rapport with the executives we are looking for? The answer is simply a system designed with that in mind.

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“The Executive Search Practitioner” The Conference, 12 October 2006, London, UK October 2006 will see a week of events designed to help Executive Search practitioners ensure that they are au fait with the latest skills, trends, issues and laws governing Executive Search worldwide. The focal point of this week will be a one-day conference, taking place on HMS President, moored on London’s River Thames Victoria Embankment. Speakers will focus on key issues affecting the Search industry. Current topics and speakers* include:

"Trends in Global Executive Search" Nancy Garrison-Jenn, Author of 10 Economist Intelligence Unit publications on The Search Industry

“Delivering Quality in Executive Search” Helen Haddon, Director of Quality and Process, Odgers Ray & Berndtson

“Implementing International Assignments” Christopher Mill, co-Founder Penrhyn International, Winner of the Gardner Heidrick Award for Outstanding Contribution to The Search Industry, Former Chair International Committee of the Association of Executive Search Consultants

“Executive Search, Ethics and The Law” Caroline Mills, European Research Coordinator, A.T. Kearney Executive Search

“Breaking up the Search Value Chain” Simon Stephenson, Co-Chairman of the Executive Research Association *Speakers and content are subject to change.

Further information to be accounced!

Book before May 1, 2006 and receive a special Early Bird rate of £175/€255/$310 plus VAT per delegate** (normal price £249/€365/$435 plus VAT)

Sponsors:

Attending this event? Consider attending the following events: 10th tuesday

11th wednesday

12th thursday

Research and Candidate Development Workshop - see more details on page 23

Search Execution and Client Management Workshop - see more details on page 23

The Executive Search Practitioner Conference

13th friday FILEFINDER Global User Conference (FILEFINDER users only)

**Terms and conditions apply. Please visit www.search-consult.com for details.

To book simply visit www.search-consult.com/events, print the booking form and post it with the cheque to: search-consult, Calvert House, 5 Calvert Avenue, London E2 7JP, UK If you require any further information, please send an email to enquiries@search-consult.com For up-to-date details of all the events please visit www.search-consult.com/events

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The initial web form was designed to take the burden of data entry off the recruiter and put it on the candidate, which works just fine for active job seekers, but rarely will a top performer sit and fill out a form. What is more likely is that the top performer will want to be known to recruiters and would be happy to take five seconds and submit his résumés. Now for the fun! So the recruiter doesn’t want to type in the résumés details but wants to capture the top performer’s data in the system and the top performer wants to be visible to the search firm but can’t be bothered with typing either. The solution: résumés parsing, which can either be on the candidate or recruiter side. FILEFINDER and Résumés Mirror make a particularly good team for this activity. Résumés Mirror, the leading résumés extraction software, is very good, but not perfect, at pulling the data off of the résumés into standardized fields. FILEFINDER builds on this strength by overlaying a quality control process. If a firm chooses to, the candidate can tell the system to inhale his résumés and instantly see the data populated in the fields so that he may give it a quick glance and then submit to the recruiter. On the receiving end, the researcher or recruiter can ver y quickly proofread the incoming data against an image of the actual résumés that they can drag and drop

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from, ensure no duplication of people or companies, and then have a fully completed, fully correct candidate profile. Of course, it’s still unlikely you will want everyone who submits their information in your system.

Your search system should allow you to easily view all incoming candidates,

whether from the web or email to quickly view and filter out unsuitable candidates. Next, you should be able to quickly add the remaining prospects to you database though an accurate résumés parsing, which ensures that you can use the full power of your system, such as seeing who in your system may know the newcomer from a previous job, grad school, etc, which would take hours to do if you had to search manually. Then, you should be able to quickly group with those people by urgency: one or two may be worth considering on a search so you can quickly link

them; another handful might look great, but you have nothing that applies right now, so you can code them as A level and create a task to follow up with some urgency; the remainder should then have a task created to follow up when you can. As a result of all this technology, the recruiter has more time to spend with clients and candidates while be able to reach more and more candidates, even some new gems that might have been previously overlooked by using only traditional target lists (and yes, a few curve balls often make great performers as seen in some recent placement by Russell Reynolds for the CEO of HP). With all this time and all these new people, why not start by having each team member dedicate one hour a week to calling people you wouldn’t have normally talked to, especially now that systems allow Outlook, Blackberry, PDA, other gizmo access and 2-way synchronization with all of your contact information? Your software system should make it easy to reach out to more candidates and offer the best service to your clients. After all, recruiting is about people, not technology.

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

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BEHABEJ@AN Ata_qpera Oa]n_d Okbps]na `qa pk epo decd lanbkni]j_a( hks i]ejpaj]j_a ]j` hks _kop* Ha]nj ikna ]^kqp pda ]s]n`)sejjejc `]p] i]j]caiajp okhqpekj pd]p eo pnqopa` û -.(,,, _qopkiano sknh`seà( û reoepejc sss*e]jusdana*_ki Cap ukqn bnaa OMH =jusdana @arahklan Aèpekj ?@ ]j` fkej pda .,(,,, àrahklano sknh`seà sdk ]na ]hna]ù qoejc ep( û a)i]ehejc6 fn]u<e]jusdana*_ki kn _]hhejc6 '00 $,% -2.4 153,2-*

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Alcoa Russia:

in Learning to Adapt By Pilar Gumucio very day the world becomes more competitive as companies are expanding their frontiers, learning how to adapt to the unique characteristics of the countries where they are venturing into. Alcoa, the world’s leading producer and manager of aluminium and alumina facilities, is a perfect example. Currently this multinational has 129,000 employees in 42 countries; servicing the aerospace, automotive, packaging, building and construction, commercial transportation and industrial markets. This multinational affirms that its success is based on a strategic vision and its people, helping them service their customers better as well as the communities where they have established these operations. A year ago Alcoa made an acquisition from RUSAL, a Russian company. Ruslan Ilyasov, the current HR Director of Alcoa in this country, as well as Jim Mundie, who was the previous HR Director until last December and is currently the company’s HR Director for North America’s mill products based out of Chicago, spoke to search-consult about the challenges this new business has faced, and how this is impacting the way they approach Executive Search in Russia. One is a Russian national and the other English, yet both executives share the same vision and expectations required from their search providers: overall deliverance, as well as a consultant’s high level of responsiveness and a key understanding of the assignment and the company’s culture and objectives. Mundie explains how the purchase of RUSAL's controlling interests in two fabricating facilities in Samara and Belaya Kalitva in Russia was completed in January 2005, after many

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sensitive issues had to be discussed since this aerospace state-governed company was previously at the heart of all the cold war activities. EXPLORING THE NEW LAND One of the first tasks performed, according to Mundie and Ilyasov, was a thorough analysis of the human assets acquired, evaluating what was the best way to integrate them into Alcoa’s global portfolio. Ilyasov explains how the company had to develop a long-term vision, taking into consideration this cultural transformation. “How do you make sure Alcoa understands and embraces all local issues? How do you transform Alcoa’s local operations to fully understand the company’s global business policies? How do you change people’s mindsets from the old Soviet system of conducting business to Alcoa’s way of thinking and doing business?”

Ruslan Ilyasov

Both HR executives praised the highly skilled and technically competent workforce they acquired. Mundie states: “Although there are some countries where labour is cheaper, you haven’t got the intellectual capability or the educational abilities that we have found in Russia.” However, this potential advantage is offset against poor leadership and management skills. According to Ilyasov, “the main reason behind this is that there is no historical link between compensation and performance.” Another difficulty Alcoa encountered is that very few people spoke English. When the acquisition was first completed, only 5% of Alcoa’s senior executives and professionals in Russia spoke this foreign tongue. Ilyasov reports how this language barrier can make it difficult to communicate with other senior managers within the organisation. In fact, it “has turned out to be a bigger issue than we had originally expected. It is a barrier to business, as well as succession planning and promotions.” To overcome these challenges, both HR executives describe how critical it is for the company to implement the right development programs that will facilitate this transition period. Mundie reports on how Alcoa has spent millions of dollars implementing language, leadership and management programs combining first handed training with distance courses that are supported by prestigious universities so that they are able to get the right mix. The company has also invested heavily in deploying its Environment, Health and Safety values as well as well as its Alcoa Business system, both of which have been well received by employees with much noticeable success.

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CLOSER TO THE FRONTLINE At the same time, the company has begun to restructure the business, aligning it with the company’s long-term strategic objectives. One of the measures adopted was moving the headquarters from Moscow to Samara - which is located about 500 miles southeast of Moscow - as a means to get closer to Alcoa’s manufacturing facilities. Alcoa’s former HR Director in Russia explains that the main reason for this move was that “Alcoa wanted to change the responsability of the operator units and have them take more control of their own destiny rather than be guarded by Moscow.” Nevertheless, there have been many challenges that have occurred as a result. For instance, Ilyasov reports how the HR’s main roles were predominately administrative and compliance-related. To overcome this, they have had to overhaul the existing structure, putting an HR development program for their own HR people. Mundie explains how the company was “also decentralising the HR people to get them closer to the operations and to the various business leaders inside the plants rather than just sitting in an administrative office. There is a lot of restructuring that is taking place, and there is also a hell of a lot of training and development that still needs to take place.” Another challenge they encountered was that the existing HR community found in the regions was generally controlled and directed by their colleagues in Moscow. Therefore, the level of capability and the level of experience in the regions were relatively low. Mundie was surprised how the HR people didn’t spend more time networking with each other, sharing vital information about salaries and emerging trends. Although there was a good network in Moscow, it simply was not existent in the regions where Alcoa’s facilities were located. The Alcoa executive recalls how the company brought in an expat specialising in compensation that made contact with the surrounding multinationals in the area to extract information about salaries and other benefits because that type of information was simply non-existent. The task was very difficult to complete but, “within the first year we had compiled more regional compensation data than anyone else

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Jim Mundie

who has been working there for the last five years… but you had to go out and do it, you had to be prepared to share information, you had to spend time with the HR directors both in Moscow and with your direct regional counterparts.” “As a result, not only did we get the data, but now there is a little bit of a network that is taking root within the HR community within the regions Alcoa operates.” Alcoa’s current HR Director in Russia believes that finding local HR talent has been a definite challenge, but insists that it can be done. In fact, he has just hired his entire HR team locally from Samara. “There are other multinational companies in Samara, and I have been able to hand-pick a few executives that I believe will add value” to this transformation process, he adds. CLIMBING THE MOUNTAIN Changing headquarters has also had a direct impact on the way Alcoa has had to search for top talent. Both HR executives describe this as a critical challenge because the candidate profile Alcoa is looking for tends to be found in Moscow, and the further you move from the metropolis, the harder it becomes to find this perfect match. Mundie explains: “You are not only in a position where you have to attract the right caliber of people with the right level of experience and mindset; you have to try to persuade them to actually move to geographic locations which are not very attractive.”

As a result, Alcoa is taking people out of Moscow and paying them a significant premium to entice them to work in the outskirts. You must be very careful with this approach, cautions the Alcoa executive, since the added cost can be considered a disadvantage. Moreover, this policy could also reinforce a complex compensation structure “since you have local regional people earning a certain salary, then you have a higher salary for those people you brought in from Moscow and then you have the expats that are on an even higher salary. Although that is not sustainable, it is what you do in the short term to help us speed up the integration process.” If convincing executives to work outside Moscow and St. Petersburg is difficult, retaining them could become even more critical. Ilyasov reports: “Many companies are entering Russia as the economy is booming. As a result, the demand for top talent that has the right mindset, language skills and management capabilities exceeds the current supply as companies have to increase their offers to make sure they can attract and retain the right talent.” For Alcoa, nevertheless, retention is not an immediate problem since the company has just started its operations in Russia. Anticipating this potential difficulty, both HR executives have worked together to develop a three year business plan that links Alcoa in Russia’s business performance to cash incentives as a means of rewarding those executives that stay with the company, and continue to make it profitable. Throughout this entire process, having the right search providers has been fundamental to help them attract and retain the best talent. SEARCHING FOR A REAL PARTNERSHIP Search is a very personal business as a client builds rapport and relationships with certain organisations. As companies globalise, this becomes more complicated as Alcoa’s headquarters will make a set of recommendations based on their preferred suppliers. “At the same time,” Mundie describes. You have to take into account that in each business location each General Manager and Senior HR Director also have their own longstanding relationships with many search providers. In the end, the decision is ultimately determined

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by them since they are the ones that know what is needed for that particular assignment.” Although there is a tendency to go to global firms because they have a good track record, in Russia - and especially outside the Moscow area - this is not always the case. According to the Alcoa HR executive, these firms “should be expanding their investments to be able to support a true international offering, which means following their clients into these regions by setting up local offices.” He explains how many search providers are based in Russia’s capital. However, many of Alcoa’s business leaders “don’t want to take trips to Moscow and they don’t want to pay for consultants to come down from Moscow to gain a better understanding of the business.” Ilyasov emphasizes how face-to-face contact is essential, describing how local firms could benefit by being able to better understand: the local dynamics, the pressures, the challenges and the personalities required to get a better cultural fit. Nevertheless, Mundie admits that consultants that haven’t had enough exposure to working in a Western environment or for Western clients won’t really be able to understand all the requirements Alcoa has, making it impossible to source the right match – despite their best efforts. He also reports that small local companies have a few consultants and support staff. Therefore, “we have to be cautious to load these firms with too many assignments. Otherwise, they are stretched and you begin to see the slippage.” Despite these difficulties, Alcoa has managed to identify a group of search firms that respond to their needs. Mundie states: “In Russia, we have used five search providers, and we feel comfortable enough to use three of those again.” “I WANT TO TRUST YOU” For the company, overall deliverance is a key factor. Ilyasov insists that what matters is the relationship with the consultant. “Each firm can have good and bad consultants. Therefore, it is important that you choose your consultant carefully and that you are comfortable with that consultant, probing hard to make sure they understand what you really require for that assignment.” Mundie agrees, describing how long-term partnerships are established on a consultant’s

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ability to respond and perform. “Being a nonRussian, I was under a tremendous amount of pressure. I needed to fill these positions quickly and I needed to be sensitive to the remuneration packages candidates being offered so that I could compete in this market. I didn’t have time to waste so I really needed to be able to trust that the search consultant fully understood the assignment, and above all, could deliver on it.” The consultant also has to gain the trust of the functional leader who the hire will report to. Both executives reported on how crucial it was for them as clients that search consultants be able to build a strong rapport with the HR Director, but equally so with the line manager. Mundie remarks: “If the line manager doesn’t feel comfortable with the search consultant, then I probably wouldn’t use that search firm again.” For Ilyasov, a strong connection between the search consultant and the HR Director and the line manager usually increased the chances of a better candidate being selected – one that had a better cultural fit. A true partnership is also based on honesty. Mundie indicates how “some search consultants are reluctant to discuss certain issues, which means that in the end they won’t be able to deliver what the client is expecting. I would prefer consultants to be honest and upfront. If we are asking something impossible to find, tell us. If we are a drift on the salary, show us with facts what we need to do to be able to attract more qualified candidates.” He adds: “If you don’t have the expertise in a certain area, let us know beforehand. We have had cases where we have gone to specific consultants that we have worked with in the past. They have been honest, letting us know that they didn’t feel confident enough to carry out the assignment. Instead, they recommended someone else to do the job. This shows us that the search consultant is thinking about our interests, and is prepared to go the extra mile - which is essential to establish a long-term partnership.” At the same time, Ilyasov advises clients to not solely rely on the search consultant to select the right candidate. He recommends clients perform periodic checks, hire other firms to verify certain information, maintain continuous dialogue and feedback, and above all, make sure that both the client’s and the consultant’s expectations are always in full agreement.

Both HR executives are best described providers listen to Alcoa’s asThose beingsearch creative, proactivethat and strategically focused, having excellent track records of HR executives’ recommendations will benefit, success. learning about some of the challenges that An accomplished human resources multinationals are Ilyasov facing has when opening executive, Ruslan worked in thisup operations in foreign country, and how that field for close to 15 years. He is Alcoa’s current HR Director of Russia. He joined Alcoa in 2005 impacts their approach to search. Search firms, and is involved in wide-ranging strategic whether global or local, must adapt to the current corporate initiatives and leads the dynamics. Theyhuman must learn to invest moreand time corporation’s resources, labour employee relations, and security and resources, expanding theirfunctions offeringsinin Russia.to their client’s business. Those that relation Before joining Alcoa, Mr. Ilyasov served learn toDirector adapt will tothe deliver outstanding as HR ofbe Alfaable Bank, largest Russian candidates to clients, allowing a long-term private bank that has various affiliate offices throughout Russia as well as the CIS partnership to flourish. Republics, New York, London, Amsterdam and Cyprus. His earlier roles include Vice President HR and Administration for Sun Interbrew and HR Director for Yukus Refining & Marketing, which at that time was considered the top private oil company. He also enjoyed a long and successful career with Coca-Cola, most prominently as HR Manager Eurasia Region, HR Director in Finland and a subject matter expert in a business transformation project based in Atlanta, Georgia in the US. Mr. Ilyasov is the past Chairman of the Human Resource Association in Russia and has also previously served as Co-Chair of AmCham HR committee in Russia. He holds an MBA from the Weatherhead School of Management in Cleveland Ohio, a Certificate in Management from the International Management Centre in Budapest, Hungary and an MS in Foreign Languages from the Military Institute of Foreign Languages in Moscow, Russia. He speaks Russian and English fluently, and can speak Indonesian fairly well. Jim Mundie, an experienced International Group Human Resources Director, has worked in this field for close to 20 years. He joined Alcoa in 2000 as UK & Ireland HR Director, and since then he has moved up the ranks to Director of European HR Services, HR Director of Russia and is currently the company’s HR Director for North America’s Mill Products. Previously Mr. Mundie worked as Group HR Director for Luxfer Group and prior to that position, worked for Alcan Extrusions for 7 years, most recently as Group HR Director. Mr. Mundie holds an MA in Employment Law and Relations from Leicester, UK. He has attended many training courses, most notably from the Centre for Creative Leadership in the US, Shepherd Moscow and the Cranfield Business School in the UK. www.search-consult.com For more information, contact: Web: www.alcoa.com

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Russia:

Exploring Possibilities by Pilar Gumucio ussia is awakening and is beginning to show its full potential. It is in its eighth straight year of economic growth, averaging close to 7% annually since the financial crises of 1998. Real fixed capital investments have averaged gains greater than 10% over the last five years, and real personal incomes have reported average increases over 12%. Nevertheless, this enormous country is still like a brilliant young athlete who still needs to be effectively managed and trained. It is experiencing a longterm economic boom, but the path from the state managed economy of the Soviet era to a market economy has not been easy as there is still a great deal of work to do.

Although there is a great number of educated and very technically competent individuals, the lack of leadership and managerial skills of the top talent can be a potential barrier, especially for the multinationals that are currently opening up offices and are demanding a more international mindset and English language skills from their executives in Russia. As the country prepares to enter the World Trade Organisation this year, there is a renewed government effort to implement some critical structural reforms. Therefore, investors are confident in Russia being able to maximise its potential as the executive search industry is beginning to take off. search-consult has interviewed Mr Stanislav Kirillov, Managing Partner of

AIMS Russia, who describes how busy his firm is at the moment because of the heightened demand in Russia. He is eager about the opportunities that are arising, yet cautious about the challenges that are accompanying these new possibilities. A COLOSSUS IN THE MAKING Within this context, Mr Kirillov describes how the executive search market is growing and becoming more competitive. In fact, he estimates that in 2005 this market produced between 30 and 40 millions Euros, with much more calculated for this upcoming year. â&#x20AC;&#x153;The most dynamic areas are related to building industr y and banking services. The area of new

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Right Target

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technologies, especially in regard to the implementation and maintenance o f p r o d u c t i o n i n d u s t r y, i s a l s o significantly developing,” explains Mr Kirillov. Executive search has been around since the early 1990s as the end of the Soviet Union has driven many multinational firms, such as Coca-Cola, McDonalds and Alcoa, to open up offices there. According to the executive of AIMS Russia, the majority of their clients are still multinationals. Some of the large local companies are beginning to use this service; aware that the demand for local talent severely outweighs the current demand. They see executive search as a way for them to be able to attract that sought af ter talent. He also explains how “middle sized local companies still do not use this service”. Mr Kirillov describes how the executive search market appeals to both, generalists and boutiques. Clients prefer specialised search consultants, but it doesn’t matter if these consultants work for a small niche boutique or a generalist search firm. What matters most to clients is that search firms deliver quality results and are responsive to their organisation’s needs. AIMS’ Russian Managing Partner explains how the search market is currently becoming more competitive, especially when you compare it to its start. Clients are becoming more sophisticated in how they select their service providers as the share of contingency-based firms is decreasing. At the same time, Mr Kirillov believes that “there is no real evidence of hard competition among active search providers yet” as he expects the market to get fiercer as the demand intensifies. MAKING SURE THE CANDIDATE FITS What is evident is that the demand for top talent is increasing, especially as Russia continues to attract more

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Stanislav Kirillov

multinationals and more local companies restructure and adapt their old way of conducting business to meet today ’s changing environment. Mr Kirillov explains that most of the candidates are locals. Expats represent only 10-15% of the managerial workforce. “The number of local managers meeting the requirements of multinationals is growing. Currently more and more local managers are replacing expats. This is significantly more cost effective” for clients, he adds. Yet it represents a challenge for search consultants: finding managers with enough qualifications, especially with a western mindset and English language skills required to perform efficiently. Multinational clients are also requesting that candidates have a western mindset, an essential element to be able to fully understand the company they are working for, and thus, be able to add value from the very start – especially in today’s fast paced and globalised environment. Local companies have traditionally had a different mindset. The AIMS executive notes how in the past local businesses have focused more on the short-term, “with enormous profit rate expectations and without taking much

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care of HR retaining and development technologies.” Mr. Kirillov explains that the main reason is that in the past, “local political, economic and criminal risks were too high to develop and follow any long term business strategy.” As a result, HR was traditionally viewed as an administrative role, checking that the paperwork was in order. He describes how HR managers in local companies were often not responsible for setting the budget and usually were not permitted to take part in the decision-making process in regard to corporate policies, procedures, or new opening roles and profiles. This trend is beginning to change, especially in the last two years. As local companies continue to report growth, competition will increase. More local companies are in a hurry to implement better HR policies, minimise procedures, reduce headcount costs and above all, be able to attract quality talent that can provide them a competitive edge over their competitors as HR is beginning to be seen as a strategic asset. HOW TO ATTRACT PREMIUM TALENT More and more companies are restructuring their HR departments and learning how to effectively align executives’ performance levels with their remuneration and compensation packages. They are learning how to document better their data and; more importantly, they are learning to collectively share this information among the HR community that is beginning to develop, so that they can see precisely what trends and challenges are emerging. As a result, they can prepare their organisations accordingly. One of the effects of this change in mentality is that more and more companies are turning to search firms and management consultancies to help them obtain this valuable information. ISSUE 26 2006 search-consult

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For some companies, especially the local firms, having this valuable information is what is required to lure top talent away from their competitors. If they offer them a higher remuneration package, then their logic is that the executive they are targeting will be more inclined to join them. This may persuade some executives to join their firm, but only until they receive another more attractive offer. As a result, search consultants are increasingly finding that they are advising clients to look at the bigger picture as attracting the right candidate is only one part of the equation. Retention and development should also be taken into account. The Managing Partner of AIMS Russia explains that another important opportunity for search firms operating i n Ru s s i a i s t o r e l o c a t e m o r e candidates from Moscow and Saint Petersburg to other regions of Russia as a result of a surge in business development outside these main metropolises. This situation provided an interesting opportunity, as clients are now demanding that more candidates from outside Moscow be sourced. According to Mr Kirillov, the level of searches located outside of the M o s c o w r e g i o n” i s g r a d u a l l y increasing. Since most of the economic and business activities are still centred in Moscow, most of the search firms are geared towards selecting top-notch candidates in this region for their clients who are also based there. As clients begin to open offices in other regions, this opportunity can be viewed as a challenge as search firms will have to invest more time and resources in order to effectively satisfy their clients’ demands. BEYOND THE HORIZON For some, this will mean opening more offices in key cities. For others, this may mean hiring more consultants and/or researchers located in other regions outside of Moscow. In the end, those search firms that can broaden

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their scope have more opportunities for success in Russia. This situation also presented another challenge, which is convincing the candidates to relocate to these regions outside Moscow or Saint Petersburg. “This is difficult because of the big gap that exists in the sphere of social life and general living conditions,” explains Mr Kirillov. Some clients are paying an extra premium to attract Moscow-based candidates to the outskirts, aware that this cost can be sustainable in the short term but hope that local candidates can soon be adequately sourced and satisfy clients’ expectations in regard to the particular mindset, language skills and management skills required. As a result, the role of the search consultant becomes critical. They must partner with their clients to be able to effectively attract, select and - more importantly - retain the right candidate. As clients’ expectations increase in regard to the qualifications required by the ideal local candidate, the standards and expectations clients demand from their search consultant is also being raised. Nevertheless, the executive of AIMS Russia reports: “There is a lack of professional consultants on the local market. We continuously look through the market to find the right consultant for our team, and we push our trainees to grow.” This difficulty may be exacerbated as executive search extends to other key cities and regions outside of Moscow. As clients’ demands increase search providers, whether they are local boutiques or international search firms, are going to have to become more specialised and competitive, establishing long-term relationships with their clients as they broaden their networks to be able to effectively source and select talent. Russia has an enormous amount of potential. As this country continues to open its frontiers, the olden ways of managing companies under the Soviet

era are changing as companies, whether they are multinationals or locals, must learn to adapt their mindset and performance to these new set of circumstances- especially when it comes to attracting and retaining talent. Those search consultants that take advantage of the opportunities that are arising - yet prepare themselves and their clients for the challenges that lay ahead - will stay ahead of the game.

Mr Stanislav Kirillov entered search in 1994, starting with search and selection projects for multinational companies operating in pharmaceuticals production and distribution, medical equipment production and sales and chemical semiproduction markets. He was involved in search and assessment projects for local companies and multinationals in industry sectors such as: pulp and paper processing, banking, oil and gas upstream and downstream, chemicals b2b distribution, construction machinery distribution & maintenance, industrial equipment sales & installation and maintenance, telecom equipment and ser vices, logistic ser vices, food production, FMCG distribution and others. He was the Co-Founder of AIMS Management Search Russia, which began operations in 2000. This company provides search, selection and assessment to clients, which are mostly multinationals operating in Moscow, St. Petersburg and other regions of Russia. AIMS International was founded in 1992 and is currently ranked second among the largest Executive Search Consultancies in the world, spanning 5 continents with more than 80 offices in over 40 countries. AIMS’ entrepreneurial oriented consultants provide a wide range of HR services including talent acquisition and development to a substantial and diversified client base.

www.search-consult.com For more information, contact: E-mail: ms@aims-international.net Web: www.aims-international.net www.aims.ru

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The Trainer: Jill Dillistone – arguably the Search industry’s leading trainer with over 20 years experience of conducting research for a number of premier search firms in the UK and Europe as well as delivering training courses internationally for major search firms such as Russell Reynolds, Heidrick & Struggles and Whitehead Mann.

BOOK NOW FOR:

Hong Kong

Tokyo

London

New York Chicago

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EXECUTIVE SEARCH TRAINING WORKSHOPS a series of 1-day training seminars for Search Professionals

"Workshop was great. I learnt some important issues regarding client management." Sorin Popa, Accord Group, Romania "Well structured, well paced, clear presenter, good group discussion and clear objectives covered." Sally Clark, Kathleen Townsend Executive Solutions, Australia "As a newcomer to the industry, I found the day very useful and came away with a knowledge of processes and techniques." Susan McCabe, Halcyon Consulting, UK

THE WORKSHOPS:

Research and Candidate Development Workshop: Hong Kong 10 May, Tokyo 15 May, London 10 October, New York 9 November, Chicago 13 November 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. You will learn: How to be creative in solving your search • Five techniques to screen candidates effectively • How better to set priorities and manage your time • The secrets of getting to the best candidates fast

Search Execution and Client Management Workshop: Hong Kong 11 May, Tokyo 16 May, London 11 October, New York 10 November, Chicago 14 November 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. You will learn: How to get the real story behind the CV • Five techniques to add value in the search process • How better to manage client meetings • The secrets of developing long term client relationships

Maximum 16 attendees per workshop. For rates and to book, please complete the booking form available online at www.dillistone.com/workshops and send it with the payment to one of the addresses provided. (please make cheques payable to Dillistone Systems Ltd) If paying by credit card, please fax it back to us on +1 (201) 221 7518 or +44 (0)20 7729 6108. Refreshments will be provided throughout the day. For more information, please visit our website www.dillistone.com/workshops or send an email to marketing@dillistone.com

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The Differences that Make

the Difference By John Maxted hilst competency testing for junior or inexperienced personnel is more often than not a relatively painless and straightforward experience, when it comes to evaluating competency or potential at the more experienced, senior end of the scale, it’s a completely different matter. It’s an issue that has taxed many corporates - and those involved in the search and selection industry - and is complicated still further by the plethora of so-called solutions on offer from the legions of ‘experts’ to be found at the click of a Google search button. At Digby Morgan we are continually striving to assist our clients to define their recruitment needs – specifically in our area of expertise, the HR arena. In recent years this has been most prevalent in the definition of what, for example, makes an HR Business Partner. Ever since David Ulrich (a Professor at the Ross School of Business at the University of Michigan and an accepted HR guru in the academic world) used the term back in the 90s in his book Human Resource Champions, Heads of HR have been talking to us about how to identify and recruit the best Business Partners. However, there seems no clear definition of the term and many people admit that they are not sure they would be able to differentiate an ‘excellent’ candidate from merely an ‘OK’ candidate.

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In discussions with companies, competency models have clearly helped to define the skills and behaviours expected. But clients still feel that it is difficult to differentiate at the recruitment stage. We wanted to take this search further and believe we may have come across a method that will help recruiters at the most senior levels identify excellence. THE SUCCESS PROFILE We have been working very closely with a consultant by the name of Jan Hills. Jan runs her own business working with companies to transform their HR function and to develop Business Partners. Jan has developed a tool that she calls The Success Profile. Essentially what the tool does is to recognise that in any organisation there are those who consistently perform outstandingly well. The reason is not simply their superior technical skills, but how they apply them day-to-day. This, in turn, is determined by their attitude and approach to their work. If you can identify the beliefs, values and purpose of these people and make them accessible to the organisation, then this can improve the performance and profitability of the entire business – not least when it comes to recruiting additional high achievers. The Success Profile approach identifies the key differentiators of high performers

and with them creates an accessible framework that will help others within the organisation adopt those same exceptional ways of working. The Success Profile works because it collects data on several different levels: • Context • Behaviours • Capabilities • Beliefs and Values • Purpose In fact, it is in modelling these factors separately and as a whole that the ‘differences that make the difference’ are usually found. The Success Profile identifies the four or five elements that make the difference. This approach allows recruiters to focus on a much smaller number of criteria. Since it also identifies the beliefs of the most successful, it enables the identification of shared beliefs that determine successful behaviour irrespective of style or background. For example, in the HR Business Partner Profile, we found that knowing the beliefs held about client relationship building enables recruiters to differentiate candidates who build relationships that are based on exceptional delivery rather than just matching style.

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When used across multiple senior roles the overall result of using the Success Profile is an improvement in achievement, effectiveness and financial performance across the business. This is done by focusing on the strengths of the organisation and in working with the company to create strategies to develop and hire those who share these strengths. In carrying out this approach with one company in retail sales, the organisation achieved significant increases in customer satisfaction, retention and revenue per customer.

John Maxted

Derived from NLP (Neuro Linguistic Programming) modelling strategies that have a proven record of identifying the key aspects of excellence and passing them on to others to boost their performance, the profile is developed through a series of semi-structured interviews and usually includes a questionnaire and an observation period. Once this data has been gathered, the distinguishing features are identified that mark the difference between the good and the exceptional. As a result, a Success Profile is created and a plan is implemented for hiring or enabling others within the organisation to adopt the same approach as the best performers. IGNORING DIFFERENCES Many companies have found that the

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approach taken by conventional, competency-based behavioural analysis can be difficult to use and can ignore differences in style and background. Therefore, they may miss opportunities for diversity and lead to the potential for ‘cloning’. Digby Morgan clients have often found that with conventional competency analysis the list of behavioural requirements can be daunting, especially to busy line managers. This tends to deter people from using the data in their day-to-day hiring and development decisions. However, because the Success Profile identifies the ‘differences that make a difference’, typically managers only have to deal with four or five elements making it easier to work with. In addition, because the Success Profile is identifying beliefs and purpose, rather than just skills and behaviours, there is less chance of being accused of hiring ‘clones’. For example: in using the Profile tool across Europe, the US and China, we found that the best performers share beliefs about their job but national culture determines the style by which they carried out the role. This resulted in the company being able to hire from a more diverse candidate base and provided them with employees who could fit into national cultures whilst still delivering performance that met their standards. Another advantage when hiring, especially in new markets such as China where skills and experience are often in short supply, is that the identification of beliefs and purpose enables recruiters to select candidates from different backgrounds and experience. One client in fashion retail was struggling to find senior managers with the right experience. Once they had identified the beliefs and purpose that drove excellence, they were able to expand their candidate search to other industries that shared these beliefs. As a result, companies looking for HR Business Partners who really will make a difference, find they must focus on those with specific beliefs about the way they build deep client relationships whist remaining independent and challenging the client. Moreover, the best Business Partners do not just understand the

business numbers but the business levers – which consist of the clients, products and employees that make up these numbers. They will also have a deep understanding of their competition as well as the market trends and dynamics. Competency analysis has taken companies a long way in defining what they require in senior roles. However, in adopting a tool such as the Success Profile, that deepens the data whilst simplifying the process of hiring, we think that we have found something that will help our clients meet their future recruitment and development challenges.

John Maxted is the Founder and Chief Executive of Digby Morgan, one of UK’s leading specialist HR search and selection consultancies. A chartered Fellow of the Chartered Institute of Personnel and Development, before establishing Digby Morgan John held senior HR positions with both British Airways and Arthur Andersen. Founded by John Maxted in 1988, Digby Morgan works closely, often on an international basis, with many FTSE100 companies and dynamic brand names. With dedicated divisions focusing on sectors such as the financial, professional services and technology industries, the company’s reputation for discretion, integrity and sound counsel has made it the consultancy of choice for thousands of senior HR professionals. He can be contacted at john.maxted@digby-morgan.com In recent years, Digby Morgan has established two additional, dedicated divisions. The first, focusing on the burgeoning interim HR market, is HR Interims. The second, HR Resourcing, specialises in the search and selection of HR professionals up to £40K - whilst the parent company, Digby Morgan, concentrates on the identification and placement of more senior HR personnel.

www.search-consult.com For more information, contact: Web: www.digby-morgan.com

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NALSC Annual Conference Executive Board of IRC Recruitment Executive Search Workshops Recruiting 2006 Conference & Expo The Technology in Recruitment Forum Signium European Regional Partners Meeting World Search Group Americas Regional Meeting INAC General Assembly Executive Search Workshops IESF European Conference BDU Conference Alexander Hughes France/Benelux/Switzerland Consultants Seminar IIC European Regional Meeting InterSearch Conference & General Assembly The Amrop Hever Group World Conference

European Executive Search Network (EESN) Members Meeting Alexander Hughes Business Managers Meeting EREC

IESF Global Conference ER Expo Boyden EMEA Conference World Search Group Annual General Meeting

IIC Partners' Annual General Meeting Executive Search Workshops “The Executive Search Practitioner” Conference Dillistone Systems FILEFINDER Global User Conference Annual IRC Conference Boyden Asia/Pacific Conference IACPR Global Conference Hunt Scanlon Leadership Forum Alexander Hughes Business Managers Meeting Kennedy Information Executive Search Summit Boyden Americas Conference

Tell us about your events: editorial@search-consult.com - see FILEFINDER at this event

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Amrop Hever Research Conference ERA Conference IESF Asia-Pacific Conference Boyden World Conference Stanton Chase International Partners Meeting

Executive Search Workshops Recruiting 2006 Conference & Expo Executive Search Workshops

APRIL 4-7 19 20-22 23-25 28-29

Budapest, Hungary London, UK Kuala Lumpur, India Beijing, China Athens, Greece

MAY: 4-6 9 10-11 10-11 11 11-12 11-13 13-16 15-16 15-17 18 19-20 24-26 26-29 28-30

Miami, FL, USA Chicago, IL, USA Hong Kong, China Las Vegas, NV, USA London, UK Madrid, Spain Toronto, Canada Dublin, Ireland Tokyo, Japan Brussels, Belgium Bonn, Germany Paris, France Moscow, Russia Beijing, China Marbella, Spain

JUNE: 2-3 2-4 21-22

SEPTEMBER: 6-9 12-14 14-17 27-30 OCTOBER: 4-6 10-11 12 13 12-13 14-16 15-17 18-19 20 26-27 28-30 NOVEMBER: 9-10 9-10 13-14

Barcelona, Spain Moscow, Russia London, UK

Moscow, Russia Miami, FL, USA St. Petersburg, Russia Tokyo, Japan

Rio de Janeiro, Brazil London, UK London, UK London, UK Shanghai, China Goa, India New York, NY, USA New York, NY, USA London, UK New York, NY, USA Miami, FL, USA

New York, NY, USA New York, NY, USA Chicago, IL, USA

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The Largest Search Firms … • The Hunt-Scanlon Global 25 Search Firms1 between them use FILEFINDER in over 100 locations • The two largest international Executive Search networks, based on the search-consult list2, use FILEFINDER in 25 locations.

The Most Efficient Search Firms … • The Kennedy Information ERN Top 20 US Search Firm3 with the highest revenue per Partner / Consultant relies on FILEFINDER.

The Highest Regarded Search Firms … • 3 of the Top 5 Search Firms in Japan use FILEFINDER4 • 3 of the Top 4 Search Firms in Asia (excluding Japan) use FILEFINDER5

The Most Search Firms … • 8 out of the Top 10 Small Search Firms in the UK, as defined by The Grapevine Magazine6, use FILEFINDER • Each of the search-consult Top 5 Search Firms in Europe2 use FILEFINDER in at least one country. • 100s of Search Firms in 47 countries across the world use FILEFINDER

...Use FILEFINDER

Why would your business use anything else? Source: 1 Hunt-Scanlon Advisors’ 17th annual recruiting industry survey, Executive Search Review, March 2006 • 2 search-consult Magazine’s The largest Search Firms in the World annual survey, September 2005 • 3 The Kennedy Information Executive Recruiter News’ annual market analysis, March 2006 • 4 Top 5 search firms in Japan refer to Asiamoney Headhunters Poll, February 2006, P49 • 5 Top 4 search firms in Asia (excluding Japan) refer to Asiamoney Headhunters Poll, February 2006, P48 • 6 Executive Grapevine market share survey 2004 – 2005, The Grapevine Magazine, October 2005

To find out how your business can benefit, book your FREE demonstration TODAY! USA: +1 (201) 653-0013 UK: +44 (0)20 7749 6100 Germany: +49 (0)69 27 40 15 807 Australia/Asia: +61 2 9006 1194 Other Europe: +44 (0)20 7749 6100 sales@dillistone.com www.dillistone.com U S A

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