Executive Recruitment Is Broken – How To Secure The Right Candidate On Your Terms In 2021

Executive Summary

Executive recruitment defies logic. Incredibly, C-level search continues to command inflated fees for drawn out processes with no guarantee of success.

Established recruiters have somehow presided over decades of innovation across multiple sectors, without ever really taking inspiration from their clients. They’ve remained committed to an overpriced and inefficient model at the expense of speed, flexibility and quality. But businesses are losing patience. Fortunately, a service-driven revolution is already underway to redefine C-level executive placement. In this short paper you will discover:

• Why businesses should demand more from recruiters
• How technology can streamline outdated processes
• The importance of transparent pricing and flexibility
• How differentiators combine to become truly disruptive.

Who should read this paper?

This paper is specially created for C-level executives managing businesses anywhere in the world.

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Introduction

Exorbitant pricing with upfront payment and no guarantee of placement. Lavish hospitality bills racked up by lacklustre candidates. Sluggish processes and stretched out notice periods. Multiple hurdles in multiple territories.

Executive recruitment is an outmoded model failing to serve the needs of a rapidly evolving modern economy. And it’s ready for disruption.

To meet the urgent demands of clients, the executive recruitment sector must combine proven expertise and extensive relationships with fresh thinking and technology driven service enhancements. Anything to become faster, more cost-effective, more efficient, more flexible.

Sourcing top-quality C-level talent is essential for all businesses, from rapidly growing enterprises to established international players. But the system is skewed in favor of recruiters and a sea change is coming.

In this short paper we challenge the outdated thinking dominating C-level executive recruitment and share innovations that will save you time and money while making some of the most critical decisions your business will face.

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Seeking fresh candidates with tired methods

What clients need and why they should demand more from recruiters – and the opportunity for those prepared to innovate.

C-level recruiters work with a diverse array of clients. But are their needs really so different? Consider the following challenges:

The international e-commerce business that needs proven talent in an unfamiliar territory. The rapidly growing manufacturer seeking an experienced COO to steer the ship as the business transcends its SME roots. The HR department of an international medical giant tasked with finding the next wave of C-level appointments to launch a new product. A fast pace growing startup seeking a dynamic interim CEO or CTO to speed up the route to profit…

The order of priorities can change, but all clients want the same things:

• The right talent, urgently
• The flexibility to choose between interim or permanent as the situation requires, or evolves
• Value for money.

Seems reasonable. So how can they achieve this?

Recruiters have something to learn from their clients

From hi-tech and fintech, to manufacturing and industrial, e-commerce and luxury brands, all businesses look for candidates who will:

• Enhance customer service
• Streamline processes
• Identify new revenue generating opportunities
• Recognize and implement advantageous technology
• Operate efficiently while being responsive to multiple demands
• Command confidence at an international level
• Challenge the status quo to achieve cut-through in a competitive marketplace
• Deliver a return on investment.

Why shouldn’t it be the same for recruiters?

Why your recruiter is falling short

Clients don’t have the time or the resources to source the right candidate without help. But too often they are forced to rely on so-called experts that can only satisfy some of their criteria, some of the time.

The ‘traditional’ model might work for some. For the largest, multi-billion dollar corporations, politics alone may mean there is no alternative to a drawn out selection process, huge hospitality bills, business flights and other expenses. Perhaps even the up-front fees – often topping two thirds of the total, with no guarantee of placement – can be justified in very specific circumstances.

For the vast majority of the market however, encompassing turnovers from $10m to in excess of $300m, businesses are desperate for an alternative.

Technology is redefining business across the world

Disruptors like Uber and Amazon are creating paradigm shifting business models to serve the needs of increasingly sophisticated, cash-conscious consumers in a global, on-demand economy.

All businesses can either fear, ignore, or admire the innovators. The recruiters who serve forward-thinking businesses should take notice. More and more clients will reject outdated, inflexible, overpriced services as they seek, a credible alternative. And it’s already happening.

The challenge

To meet the reasonable requirements of clients, savvy recruiters are recognizing the need to restructure their service in three core areas:

• Technology
• Pricing
• Flexibility

Let’s take a closer look at what’s driving the evolution in C-level recruitment…

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Technology

The goals and gains offered by technology and how to overcome the hurdles to implementation.

Clients and C-level candidates are crying out for recruiters to implement the advantages afforded by technology. That said, no single piece of technology is sufficient or an end in itself. The goal is to offer a streamlined client and candidate-orientated service that saves clients’ money while ensuring quality.

Below we assess the obligatory, the overrated and the overlooked technologies that have the power to shape executive recruitment:

Data is still key

It’s no surprise that having a large, ever growing database of carefully assessed talent is essential. Many recruiters lean heavily on their databases (albeit few offer a truly international pool of certified candidates). But data alone is not enough.

Social media doesn’t replace expertise

Not all technology saves time. The rise of LinkedIn and other networking platforms has ostensibly made recruitment simple. Why hire a professional recruiter when you can do it yourself? Unfortunately, many businesses have fallen into the DIY trap. They fail to account for the amount of time and effort required by job posting, candidate screening, final selection, and interview organization etc. Lured by the apparent efficiencies of ‘free’ services, businesses are in fact diverting valuable resources away from more productive tasks. This is where an experienced third party – with an established network and specialist expertise – can provide a focused, faster service that saves money in the long-term.

Video is more and more used

Video conferencing facilitates a greater number of immersion sessions and interviews; it’s faster, cheaper and more thorough (at the sourcing stage) than face-to-face meetings.

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The case for video

Clients and recruiters alike are ready for a change in mindset as well as technology. For all but the most high level, politically influenced appointments, video meets or exceeds the needs of businesses and candidates.

Here’s why:

Do face-to-face interviews always deliver ROI?

Successful businesses are accustomed to choosing investments or products that offer the highest return. They do this by limiting emotional factors, assessing the evidence and making rational decisions; is paying the highest price for the perceived ‘best’ product really always the optimal solution? Or can another solution meet your requirements for a fraction of the price?

Video conferencing enables you to ‘look candidates in the eye’ (without the red eye from international travel) and put them on the spot – offering all the essential advantages of face-to-face meetings at a fraction of the cost. This is particularly valuable when managing cross-border placements.

Interviews should be supported by a stringent vetting process

Handshakes only recognize deals, they shouldn’t seal them. Charisma can often trump competence and holes can appear when the interview performance is a distant memory.

Video conferencing enables recruiters to assess far more candidates – in greater detail – and for clients to review many more than they would face-to-face in the same time, not least on the same budget.

Video is great for candidates

Video enables candidates to communicate their personalities and experience, while sharing engaging content and thought leadership that can prove their credentials.

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Pricing

Fee structures are rigged in favor of recruiters. Value should flow back to clients.

Costs are out of control. Rates for C-level permanent recruitment continue to rise, with one market leader revealing an average fee in excess of $114,000. It’s difficult to justify paying such inflated prices for a CFO or VP of sales. The problem is simple: executive recruitment incentivizes profit before people. Recruiters should be focusing on the right individual rather than most expensive.

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More value for money

As discussed above, technology driven savings should be passed on to clients. But fee structure has to change to create a truly equitable service. Clients want to see:

1. Transparency. Not just in terms of pricing, but also in the pool of candidates clients can expect to have access to and the specifics of the recruitment process. Expertise should be evident for all to see, without resorting to obfuscation or mystification to justify a hefty fee.
2. Fixed fees. Retainers are not financially sustainable and risk rewarding inefficiency and even failure. Recruiters should not stand to profit when unsuccessful appointments restart the process.
3. Pay for success, not the process. Why are businesses paying up to two thirds of the fee without having the right candidates? Payment on placement is crucial and there should be no cost to source a replacement if the placement is unsuccessful.

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Flexibility

Where speed, expertise and resources make the process seamless – and businesses can keep their options open for short to long-term positions.

When businesses need talent, they need it urgently. Inefficient recruitment processes delay critical decisions and create missed opportunities. To facilitate a rapid response, recruiters must have the resources to find the right talent anywhere:

• International reach and local knowledge – with the experience to meet the challenges of cross-border placements
• An extensive database of qualified candidates ready to move. Too many time-sensitive opportunities are delayed or missed entirely due to lengthy notice periods. Finding available talent before it is required is the key to rapid appointments.

Interim to permanent as the situation requires

Most recruiters favor permanent over interim placements because they earn around double the commission for the same amount of work. But the flexibility of interim brings many advantages for clients in particular circumstances. Many projects require an injection of talent for limited periods or on a test basis; product launches, setting up in a new territory, restructuring a division and so on. Clients should not have to compromise on choice or quality simply because the requirement is for a limited time period.

Recruiters should offer both interim and permanent with payment services during the interim period and the flexibility to move from interim to permanent as the situation requires.

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When do differentiators become disruptive?

The combination of factors that create true market disruption … and make CEO Worldwide unique.

Traditional recruiters only focus on a few service areas. This might give them an advantage over some – but it’s not enough to disrupt the market.

There’s nothing unique about an extensive database alone. A fixed fee can be an attractive proposition, but can’t replace quality (and is too often a disguised percentage for a particular salary bracket). Speed is highly desirable, but hampered by lack of international reach.

So, what does it take to disrupt executive recruitment? A combination of all the key differentiators: fixed fee and payment for success; flexible interim to permanent placements; one week candidate selection.

The CEO Worldwide model

True disruption comes from combining differentiators.

Disruption in action

How does this work in practice? Here we chart a typical placement to demonstrate the speed, efficiency and quality of the process:

1. Kick-off. Both parties sign a letter of engagement (including non-disclosure); a one hour briefing session confirms the credentials of the desired candidate.
2. One week later. Client receives a selection of 4-6 candidates matching their requirements. All candidates have gone through rigorous interview and briefing sessions.
3. Pitch for the job. Clients review references, financial expectations, availability, candidate generated thought leadership, examples of past successes, video resume (submitted via CEO Worldwide’s YouTube channel).
4. Interviews. First interviews conducted by Skype/Zoom, followed by face to face interviews for shortlisted candidates.
5. Candidate is chosen for interim assignment or permanent role.
6. Payment. Payment on placement, with completely transparent pricing:
   • Interim
     1. Fixed monthly cost disclosed with full transparency, specific to region. See more
     2. CEO Worldwide pays candidate via payroll services in interim
     3. Switch to permanent: CEO Worldwide agrees % of salary
   • Permanent
     1. Fixed cost disclosed with full transparency, specific to region. See more
     2. Invoice sent on the day candidate joins
7. Special conditions. For interim, a seven-day notice period. For permanent, a 12 month guarantee period. For both, no retainer, no exclusivity required.

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Case Study

Finding a CEO in seven days.

Five countries, five time zones, five cultures. How CEO Worldwide submitted five ideal candidates in under a week. How CEO Worldwide submitted five ideal candidates in under a week.

Avery Weigh-Tronix, headquartered in the UK, is one of the leading industrial scale and weighing system manufacturers in the world, and a subsidiary of ITW, a $15bn revenue US conglomerate.

“When we contacted CEO Worldwide, we urgently needed to find a new MD for our India operation (600 staff and two manufacturing plants). The required criteria were:

• Managing director with significant experience in India and abroad, in the industrial equipment sector serving the manufacturing, construction or transportation industries with more than 600 employees and multiple plants to manage
• University degree, possibly MBA
• Strong turnaround experience (kick-starting sales growth, implementation of modern manufacturing methodologies and increasing collaboration with the rest of the group)
• Bilingual Hindi-English

We had been looking to recruit our new MD for some considerable time without success. Therefore when CEO Worldwide presented its shortlist of candidates in less than seven days, we were really impressed to find very strong matches in five profiles.

We appreciated the quality of the professional follow up and coordination service done by CEO Worldwide during the interviews and negotiation process. CEO Worldwide enabled us to move quickly and close the recruitment in a very short time frame despite the fact that five countries, with their respective time zone and traveling limitation due to Visa issue, were involved in the recruitment process (India, Oman, UK, USA and France).

CEO Worldwide also played an important intermediary role during the negotiation of the candidate contract conditions, enabling us to rapidly finalize the contract signature.

We strongly recommend CEO Worldwide’s executive recruitment service for companies which are looking to hire an executive in a short time frame and within an international context.”

Peter Branston, Managing Director Europe, Middle East & Africa of Avery Weigh-Tronix

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Conclusion

Technology, flexibility and pricing. All watchwords of virtually every top-flight C-level executive around the globe. The same ones that recruiters are asked to find urgently on a daily basis. You’d think it would catch on.

And yet traditional recruiters continue to thrive. Why? Because their clients are wholly committed to competition. It’s what fuels innovation, streamlining and service optimization, and of course jobs. But where’s the innovation, streamlining and service enhancements in the world of executive recruitment?

We can’t say the system is rigged, because the truth is clients are complicit. It’s not that they like paying too much for too little. They just haven’t pushed hard enough

Perhaps they haven’t paused to consider the overblown fees and drawn out processes. Maybe they’ve sighed and accepted the status quo. They might just prefer predictable tradition to profitable upheaval.

What’s your experience of executive recruitment? Were you confident you were getting the best selection of candidates? Did you find them fast enough? Was the face-to-face selection process really worth the air miles and hotel bills? Did reputation command a premium before results?

Was it just the price of doing business with a critical position to fill?

f you answered “no” to any of those questions, it might be time for a change.

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What makes CEO Worldwide different?

• International reach. CEO Worldwide specializes in cross-border placements with a 19,000 strong database of proven candidates from over 180 countries.
• Rapid response. CEO Worldwide will share candidates within a week’s notice; numerous candidates ready to move.
• Interim to permanent. CEO Worldwide provides interim to permanent services 3-6 months with view to contract extension. If the talent stays CEO Worldwide will take cut of salary within nine months. After ten months no cut is taken. If the talent leaves within six months CEO Worldwide will send more candidates FOC.
• Experience. Everyone on the team has had operational experience at C-Level across the board. Unrivalled cross-border experience, knowledge of the negotiation process.
• Disruptive differentiators. CEO Worldwide combines payment on success and fixed fee; interim to permanent; one week candidate selection, cross-border placements. 12 months guarantee and no exclusivity required.