Whether it’s technology executive search in London or a marketing guru your business needs, executive search works – and in this article we’ll paw through some reasons why.
The fact is, the most successful companies in the world are only successful because they have the best staff. Smart managers and business owners know that they cannot do it on their own and that growth only happens with the right team in place.
It is fact that all the top Fortune 500 companies use executive search to find their top managers. It is well known that the best people in the market are not looking for a new position and so you need an expert to access this talent pool. The majority of directors and business owners we talk to are very busy building their business and although many believe they can do it themselves the majority end up wasting lots of valuable time, incur lots of hidden costs and often get no hiring result at all.
We understand the urge to believe it is easy to get the top talent yourself. Having said that, when we have a tooth ache we go to a dentist, when we have finance need to go to our accountants and when we have recruitment need we go to a specialist recruiter. (Yes executive search and recruitment firms use executive search too.)
The truth is that fees for executive search can be large; however the cost of “doing it yourself” or not doing it at all can be far larger.
Let us give you an example of what we mean.
An IT services company was looking for a new Business Development Manager as their current manager un-expectantly left the company. They had a particular service selling into the IT industry and there were a limited number of global companies that would use this service. They wanted to make the hire themselves to avoid the cost of an executive recruiter and advertised on several job boards and asked their staff for referrals. They got over a hundred responses. However, when they went through the CV’s they discovered that there was no one that fitted the skillset they had wanted. They started the process again and got similar results. A three month period has now gone and they decided to use us on an executive search basis. Within a month the right candidate had been presented and position offered and accepted. It took a further 2 months before the new Business Development Manager could start due to his notice period.
It was subsequently discovered that because of the six months that the Business Development Manager position had been vacant a major competitor company had been given a window of opportunity. The competitor company had signed eight large deals worth in excess of 20 million and the client companies had been tied into a minimum three year contract. After some additional internal analysis it was discovered by management that the average sales cycle for signing clients was four to eight months. It dawned on management that with their situation, it was realistically somewhere between nine months to a year that the company would not be making any new sales. Once the new Business Development Manager started he discovered that there were other big deals in the pipeline for the competitor company that put them at a serious disadvantage. The Finance manager of the company dutifully delivered his forecasting analysis. Without new business coming in it put additional pressure on the bottom line as excess service staff had been taken on in anticipation of new deals before the original Business Development Manager had left.
Relying purely on in house recruitment can often lead to massive downtime for staff as they need to be able to handle recruitment on top of their normal duties. Thus recruitment takes far longer.
There are always recruitment costs such as jobs boards, staff time, printing, telephone costs etc. Most of these are hidden and generally they are not considered by managers. That cost is estimated to be between 2,500 – 4,350 per employee. (On average the costs are higher per employee for smaller companies as there are fewer positions to spread the cost across.)
The cost of leaving a position open for long periods of time can have a serious impact on the bottom line. This is including but not limited to, loss of sales and paying for additional staff that have very little work to do.
On the whole, the cost of executive search is generally far less than the potential loss of business and cost of staff time as well as the cost of leaving a position open. Avoiding these losses as well as other issues that we have not mentioned here should be a priority of any business owner. Your time and energy should be spent where it is needed most; growing your business.
Using a professional Executive Search firm can minimise all of the above. Our experience is that once a company decides they need an executive they generally mean they want that executive to start as quickly as possible. A six month gap is too long for most organisations, particularly SME’s. Moving on recruitment needs quickly and decisively is ultimately is the best and cheapest strategy.