Like any professionals, Executive Recruiters “talk shop”.  Folks like to get together and chat about their wins and losses. And because there’s a significant sales component to this role, we’re judged more by our wins than our losses.  As such, when talkin’ shop, it’s sometimes hard to discern what information being shared is accurate.  Imagine a Ford Salesperson standing next to a Chevy Salesperson talking about the number of units they sold in October and what the Gross Margins were on their deals, it’s similar here.

Before I co-founded Élever Professional, I was with a Fortune 500 Staffing firm. Former colleagues from those days often call me with reports of such gaudy sales figures that I wonder how they can fit them all in a 24 hour day.  I typically leave these conversations with a chuckle and a 30 minute deficit in my work week.

Recently, I left one of these conversations concerned about the state of the industry.  A former Sr. Director with a large staffing company called to let me know that his own firm had decided to shift from a generalist and staffing mentality to an industry focused Executive Search firm.  Their plan was to do away with temporary staffing altogether and build upon their recent success with a client in their new “area of expertise”. Their reasoning was that they didn’t want to be like me.  Hey, no offense, Pal.  None taken.

By me, they were referring to my firm’s long term commitments to a small and select number of clients, rather than a large and expansive pipeline that covered the gamut of search requisitions, from entry level admins and mail clerks to CEOs.  They’d closed a significant amount of work with one client and realized that there is money to be made in a relatively under-serviced field, and they were going to re-brand and go after it!  What’s the problem with that?  There’s a large addressable market with a proportionately small competitive field.  Smart business decision, right?  There is no problem there, fundamentally, but as I asked key questions in an effort to learn about their commitment to this field relative to their success, red flags began to unravel in every direction.  Here’s an unofficial transcript, sensationalized for your reading enjoyment. Names have been changed to protect the innocent (or guilty): 

Me (curious): So, you’ve had success in this space in the past?

Newly Self-Anointed Industry Expert: We closed 4 deals in 4 months, the client paid prior to the start and I only had 30 day guarantees from the date of invoice.

Me (curiously suspicious): What was your firm’s role in these, eh-hem, successful hires?

Newly Self-Anointed Industry Expert: We conducted the interviews, sat in on the panels so that we could control the hiring, and when it was time to make the offer, we pushed the terms that would close the deal.

Me (skeptical): So, how did these placements work out?  Were they successful hires?

Newly Self-Anointed Industry Expert: We placed two Senior Candidates at 100k+ and two mid-manager candidates at 60k+ annually.  The two Senior Candidates we placed are no longer with the company and the mid-manager level candidates seem to be doing ok.

Me (confounded): Ouch. That’s a 50% success rate, if you can even call “doing OK” a success.

Newly Self-Anointed Industry Expert: The good news, however, is that our replacement guarantee was only 30 days, so we don’t have to refund the fees and don’t have to repeat the search.  The first guy was a complete phony and got fired on the 41^st day, the second guy was no good and quit on the 45^th day, but he was going to get canned anyhow.

Me (Appalled, screaming, phone on mute): This is appalling.  So, you identified these people, you were on the board that hired these people, you pushed the deal through, AND you collected significant fees for the privilege. Yet, you hold ZERO accountability for their lack of performance?  And this is what you’re bragging about on a random call to an industry peer? With wins like these, who needs losses?

Me (please, someone, put me out of my misery!): So what are you working on going forward?

Newly Self-Anointed Industry Expert: Well, we’re really going to dig in and focus our efforts in this field.  We’ve been mass-emailing and have created over 20 requisitions in just two weeks.  We’re so busy that we are looking for recruiters to partner with on some of these.  Hey, you’re in Austin, Texas, right?  So you could probably help me.  I am searching for a clinical Psychiatrist, but just don’t have time to do any real work on the search.  Can you head that up and we’ll split the fees?

Me (watching clock, wishing I’d spent this half hour doing something more productive, like flossing, or cutting my cuticles, or letting my wife back over my shins with a bulldozer): No can do, I don’t do know enough about that field.  Our team won’t go near anything outside of our practice area of Software, Tech, Mobile and Digital.

Newly Self-Anointed Industry Expert: Oh, ok, I get it.  So, that reminds me, we just picked up 20 requisitions in New York and Boston for IT administrators. $60k/year.  We’re billing at 6%.  Is that what you do?  Interested in splits?

Me (stabbing myself in forehead with dull pencil): Not exactly, but thanks for thinking of us.

So much for that whole, Industry Expert thing…

What I took from this conversation is that there are search firms measuring success by the number of “Grab and Go” transactions they close, and not by the positive impact their placements have had on the organizations they’re collecting fees from. These placements were made in haste, forced through by the recruiter in control of the process, and delivered with a false promise of recourse should the hire turn out to be a dog. They call these “services”, services for which a hiring company allocates a significant portion of their hiring budget to obtain from people who call themselves “experts”.

This conversation is symptomatic of a broad exploitation problem within the recruiting industry.  Too many recruiters push deals through for the sake of the deal, not for the sake of the client’s long term success and sustainability.  Cut it out.  It’s an unethical practice. We should get in on the hiring process because we’re experts in the field and can make recommendations based on experience that can help a client to make a right decision, not because we’re facing sales goals.  We must make recommendations to hire, and even more importantly, NOT to hire when they’re appropriate. Some of the hardest decisions I’ve made have come when a transaction is on the verge of closing and through my diligence I learn that there is reason for concern.

I could fill 70 pages with expletives about how this mentality ultimately crushes the reputation of Executive Search Consultants, recruiters, and the TPR Industry as a whole, but in fact, it does the opposite for those of us who truly represent the client, and not the transaction. Oh, and since we're talkin' shop:

Since inception in February 2010, Élever Professional has a placement success rate of 100%.

Originally posted at http://eleverpro.com

by Tyson Spring

Partner and Sr. Search Consultant