Dr John Sullivan Talent Management Thought Leadership

During tough times, recruiters need to do all they can to improve their internal image among senior managers and budget-cutting CFOs. Unfortunately, most recruiters and recruiting departments miss a great opportunity to build their internal brand when they outsource the recruiting of high-level jobs. Recruiting has it “bass ackwards”! From an image, branding, and power-building perspective, it would be smarter to outsource the high-volume (but low importance) non-exempt jobs and instead focus on the high exposure and high impact executive jobs. But for some unexplainable reason, recruiting functions almost invariability choose to spend their limited resources on the jobs that have the absolute least business and brand-image impact! Get smart: Focus on the high-level, high-exposure, and high-impact jobs. Politicians know it, salespeople know it ó but HR recruiters don’t seem to understand the political realities of business. Maybe HR people think they are “above it all,” but when they have a choice, smart managers always choose the projects and jobs that:

• Have the most impact on the business and stock price

• Have the highest priority (as set by senior executives)
• Provide the most interaction with and exposure to top executives and decision makers
• Require the most advanced skills and competencies but also provide the opportunity to demonstrate those skills
• Bring the most praise, recognition, and rewards to those that managed them
• Are resource rich, where cutting expenses is much less important than producing results

What could possibly have more impact than recruiting executive and senior management and technical jobs? I occasionally get the honor of advising companies on what to look for when they are about to hire a new VP of HR. I call it an honor, because:

• I get to meet and advise powerful senior executives who might later reciprocate and return the favor.
• If I get it right, there will be a significant business impact.
• I get a chance to stretch my brain and improve my skills on the most complicated hiring job within HR.

In contrast, when someone calls me for advice on recruiting for a blue-collar or hourly job, I politely but quickly refer him or her to a professional recruiting firm. Why the difference? Well, to anyone outside of HR, the reasons to focus on top-level jobs and outsource the ones with little impact are obvious. However, within the recruiting profession I am constantly baffled by recruiting managers who have more of an interest in “filling reqs” than they do in wowing senior managers and building a powerbase by doing the low volume but the hardest jobs first. If you could recruit both the top-level and the bottom level positions, some would argue that you should do them both. I would disagree with that point. Recruiting never has enough talent, time, or resources to do it all. Those who think we can do it all are naive at best, and during tough times ó they’re just foolish. Do the top and mid-level jobs, and outsource the rest. Now is “prime time” for recruiting at the top and outsourcing at the bottom. Incidentally, in tough economic times the vacancy rate of top positions goes up dramatically. The current turnover rate of CEOs is the highest ever. Seventy percent of newly hired senior manager leave within the first two years. In contrast, however, hiring for hourly jobs is at a standstill. Now is the time to explore outsourcing options, when volume is low and vendors are hurting for business. Why do most recruiting managers avoid doing executive search? There is no hard research available that explains why HR managers choose to avoid doing in-house executive and senior technology management recruiting. But after 30 years in the business, I can give you a pretty good idea of why “HR weenies” (as some managers call them) avoid doing “the tough stuff first.” They include:

• Most recruiters don’t have the needed confidence. And, rather than seeking out difficult opportunities, they focus on the “sure thing.”
• Many people in recruiting don’t have the level of skill or experience in recruiting that it takes in order to successfully fill the high-level jobs.
• Let’s face it, executive search professionals (as a rule) are ten times more aggressive and are better at selling their services and influencing senior executives than the average HR recruiter. They know about the job openings long before any internal req is issued. They also have, over time, built up strong personal relationships with the senior decision makers. As a result, external executive recruiters “have the job” long before internal recruiters can seize the opportunity.
• Some recruiters are just order takers, while external executive search professionals are sophisticated marketing and salespeople (in addition to being good recruiters).
• Many recruiters see their current recruiting job as a short-term position that is merely a necessary step on the way to a more desirable job within HR. As a result, they don’t desire to become expert recruiters, and they avoid projects that have the potential for a high failure rate.
• Most recruiting functions provide absolutely zero training for their new recruiters, so recruiters spend so much time on the job learning their profession that they have no time to learn how to do the high-level searches.
• Recruiting for high-level positions requires tools and strategies that are several levels more sophisticated than searching monster, attending job fairs, and placing newspaper ads. And since most candidates for executive positions have multiple job choices, high-level closing skills are necessary to get the candidate to say yes. Most corporate recruiters just don’t have those sophisticated closing skills.
• Some HR people are basically social workers at heart. The last thing they will tolerate is anyone who actively seeks power and influence. It’s just not politically correct to admit that people in HR should be focused on marketing their function and building their powerbase.

Some other reasons to avoid outsourcing your executive positions:

1. Ninety-nine percent of executive search firms have absolutely no hard data that proves they produce hires that stay longer or perform better on the job. They also have only marginal (anecdotal) evidence to prove that they produce quality candidates faster or at a lower-cost than internal search efforts.
2. How can you maintain a competitive advantage if the search firm you hire turns around and offers the same candidates and services to our competitors?
3. All of the competitive intelligence and the benchmarking information that is gathered during the search process is lost to the firm if the search is done externally.
4. Executive search firms are unwilling to base their fee on the quality of the candidates they provide and the performance of the hire over the first year. In contrast, because internal recruiters have a stake in the pie, they are more likely to put 110% into it. This is due to the fact that they and their colleagues will suffer a major impact if the hire turns out to be bad.
5. In our fast-changing world, jobs, skill requirements, technology, and competitive realities change almost overnight. As a result, only an insider can really know how to meet the unique needs of your company, your culture, the job that is being recruited for, and the hiring manager.
6. Using external recruiters on tough jobs reinforces the already weak HR image. (i.e., “HR can’t be trusted to do the ones that really matter.”)
7. Candidates found by executive search firms are likely to be active candidates (people actively searching out new jobs). Active candidates, unfortunately, are more likely to be bid on, and therefore more expensive to hire than the passive candidates that have not yet interviewed at multiple companies.
8. Once placed, executive search candidates remain on the executive recruiters “to call” list. As a result, they are often harder to retain, since the executive recruiter will continually try to draw them away after a year on their new job has passed.
9. Because search firms frequently prep their candidates, you often get an inaccurate view of the candidate.

The Next Steps in Building Your Internal “Brand” Once you reach the conclusion that it is essential that you do most ó if not all ó of your executive searches internally, your next steps should include:

• Researching and benchmarking the best practices in executive search
• Making the business case for doing internal executive search
• Identifying low impact jobs that can be outsourced
• Developing a strategy and an action plan
• Hiring at least one recruiter with executive search experience
• Getting one senior manager’s “buy in” and then selecting a few “target jobs” to refine your skills, tools and strategy
• Developing performance metrics that not only help you prove your success but that also aid you in continually improving your executive search process

Conclusion This article is not meant to focus on the many positive and negative reasons for using external executive search. Instead, its primary goal is to force recruiting managers to rethink their priorities. It’s time to realize (if you haven’t already) that if you expect to have a significant business impact, you need to have an internal brand image, power, and influence. If you want individual job security and to avoid budget decreases, you must focus on the positions within your firm that have the most business impact ó and they are the top-level senior management and technology positions. It’s simple: if you want power, you have to “play with the big boys.” Unfortunately, I have found that less than 10% of all recruiting functions include an internal executive search component. Logically, we already know that all jobs are not equal. But for some reason, we fail to prioritize our own jobs and focus on the key impact positions. This also means that, invariably, we will fail to disproportionately allocate the most time, talent, and resources to those jobs that have the most impact on the company ó and, yes, on our careers.