Why Hire an Executive Search Firm?
Hiring talent is something that affects every business and every level of management. The ability to recruit great talent is key to the ultimate success, or failure, of a business. However, there are certain roles that can be particularly difficult to fill. In these scenarios, there are times when it can be incredibly valuable for an organization to partner with an outside search firm.
The Harvard Business Review has stated that over 80% of employee turnover can be attributed to poor hiring choices. Similar research conducted by the US Department of Labor states that the price of a bad hire is 30% of the employee’s first-year earnings at a minimum. As the position becomes more impactful to the business, this number increases exponentially. Our own research estimates the true long term cost of a bad hire to be $211,000 based on a $95,000 salary. Most companies would agree that given these numbers they may want to think twice about their own hiring practices. Taking steps to avoid making costly hiring mistakes may begin with internal processes but it also may result in consideration of hiring a professional search firm.
Here are just 6 common scenarios that make working with executive search firms a very intelligent and profitable decision for your company:
of our business is repeat business
of our candidates are headhunted from their current positions
faster than industry average
1. Time Lost is Opportunity Cost:
The need to allocate internal resources to conduct a high profile search can prohibit a business from growing as it needs to. Instead of running operations, handling employee relations, building partnerships with new businesses, or otherwise performing at the peak of their ability, business leaders are occupied with the job search. What is the cost of missed opportunity for your company? Time is money, remember that yours is valuable.
2. The Role is Beyond Internal Expertise:
Often times leadership roles are the toughest to recruit for due to the fact that there may not be an internal team member who can fully appreciate and understand the role. If they cannot fully grasp the challenges of the role, it will make the process extremely difficult to define the parameters, recruit talent, and make a sound decision. Because the role is outside the internal recruiter or business leader’s own knowledge base, it will be very difficult to fully assess a candidate’s answers in an interview and determine the right fit for the company.
3. Internal Resources are Limited:
Not all companies have the luxury of having a dedicated Talent Acquisition department. Even if they do, this may not be an expansive team. HR departments do so much more than hiring, they are responsible for employee relations, benefits, compliance, training, etc. which are absolutely vital to an organization running properly. With a finite amount of time and resources, HR departments are often stretched too thin and good talent can slip through the cracks. Both from a time and a workload perspective, there are situations when the resources must be ruthlessly allocated. If the role has been unfilled for an inordinate amount of time, or the internal HR department is already near or at capacity, a difficult position to recruit for is not going to receive the attention it warrants. Instead of making the decision to permanently hire new personnel for what may be a temporary influx of hiring needs, partner with a reputable search firm. A search firm deals solely with recruiting talent and has mastered a myriad of tools and strategies needed to hunt down the best possible talent for any position. Does your internal team have the resources needed to find the perfect candidates for every needed position?
4. The Role is New or Needs to be Rebuilt:
New roles are particularly difficult to recruit for because, typically, there is no benchmark to serve as a point of reference when determining the skills and temperament needed. This is also true for roles in which the predecessor was unsuccessful, and the role will need to be redefined/department rebuilt, etc. The need for guidance increases exponentially when the position falls outside the standard scope or target profile at other companies. Generally, successful companies find themselves in this position and quickly lean on the experience of an executive recruitment firm.
5. The Role is Very Impactful:
Logically, the negative impact of a poor hire only increases with the level of influence a position has within a company. Successfully finding a leader who will define strategy, work with other departments and create processes which will affect future decisions is something that should be carefully considered. The cost of a bad hire in this situation can be astronomical and in some cases can take years to recover from. Conversely, making a great hire can have a positive ripple effect throughout a company for years to come. The problem is that internal teams and business leaders are not always able to look in the same places a headhunter can. Doesn’t your company deserve the best talent to lead the way?
6. Internal and External Confidentiality:
When an internal search needs to be kept confidential from staff, partnering with an executive search firm is an obvious solution. What many business leaders tend to overlook is the need for the search to remain confidential to outsiders as well. Because they will be calling on behalf of the company, internal resources immediately alert any person they speak with that change is on the horizon at the company. Only a search firm will be able to speak with interested candidates who may currently be working in the industry, or possibly at a competitor, without divulging the identity of the company to every person with whom they speak.
SO WHY HIRE A SEARCH FIRM?
Because your company needs to win the battle for the most talented professionals. Because an internal team recruits with a limited field of view, lack of tools, and outdated methods. Because 85% of professionals in today’s job market will consider taking another role for a good offer. Because job boards were ranked least effective for finding high-quality candidates by HR News Daily. And because search firms can view your company as either a client or a pool of talent.
