Attracting Executives in a Challenging Economy

A trend by Cook Associates Executive Search

Corporate hiring organizations and executive search firms are among the first to see national and global economies change from robust to downturn. It's no wonder since the economy dramatically affects hiring decisions. Many corporations begin shying away from acquiring talent in challenging economies.

Guy Schiller, a senior human resources executive with over ten years at Danaher Corporation and an early background in organizational development cautions, "While CEOs and human resource leaders typically use some sort of talent assessment and succession planning process, tough economic times can cause them to hold off executing on those plans. In the end, that could be a strategic error for the business."

With management focused on weathering the storm, recruiting budgets are slashed and sometimes even eliminated. The thought of spending huge dollars on hiring expenses such as relocation causes many to put the brakes on talent acquisition during a downturn.

The response from human resources can be binary: fall in line and halt all recruiting or maneuver the budget without allowing it to interrupt hiring plans. "This is the time to be proactive in keeping the heartbeat. Economic downturns are purely cyclical. If there are gaps in the organization, force rank and prioritize them, then spend the dollars that have the highest ROI," advises Mr. Schiller. "Your strategic hiring plans must always be in motion."

While corporations struggle with ‘to hire or not to hire', executives begin turning away recruit calls, hesitant to explore new career opportunities.

The executive search consultancy at Cook Associates, Inc. reports that during an economic downturn, executive portability - the willingness of high performing executives to step out of a solid, known situation and into unknown company - drops precipitously."That is exactly why organizations must get ahead of the curve when it comes to acquiring talent in a difficult economy. The relentless pursuit of attracting great talent regardless of economic conditions is a must. Bringing someone on board during these times and showing your commitment to their development can breed a higher level of commitment from that individual. It also sends an important message to the organization that you are committed to the future, not just the next quarter." advises Mr. Schiller.

With Boards, CEOs and human resource leadership increasing their demand for fast, high quality recruitment results when the stakes are raised, selecting the right search partner is critical - especially with high performing executives predisposed to staying put.

It is no coincidence that during these times corporate talent acquisition leadership and operating executives pause to recalibrate their external partner relationships, strategy and tactics.

Marketers adjust to a changing economy by leveraging the ideal advertising partner and employing precise tactics to increase both reach and messaging to attract customers. Such is the case with executive hiring. "Partnering with a search firm that is willing to unearth talent during difficult economic times is critical," says Mr. Schiller.

Savvy corporate hiring leaders increase their chances for success in uncertain times through precise tactics that include retooling corporate processes, but also by adjusting their mix of search providers and their authority to engage them. What are they looking for?

Reputation, size of firm, and the caliber of search professional are increasingly on the minds of clients during changing economies. Flexibility, focus and access are also important.

The preferred search firm model maximizes the number of preferred companies open for recruitment. If your company relied on large search firms during robust economies, add mid-sized and boutique search firms to the mix, ensuring unlimited access to top executives during those economies when executive portability is most constrained. In the war for talent, the field of view and focused fire of a rifle trumps that of a shotgun.

Boutiques are rarely blocked from recruiting out of preferred, best-in-class companies. Large global firms, blocked from a significant list of companies that likely expanded during the preceding, robust economy, may generate executives from lesser companies or only consult their resume database.

Some believe that boutique search professionals have stronger networks. "I've found that boutiques have a level of intimacy with their client base and an ability to uncover new talent not solely based in a database," concludes Mr. Schiller. "They stay up-to-date with executives in the industry, and keep up those relationships. That's important since oftentimes the only reason an executive will explore a career opportunity during a down economy is because of a trusted relationship with the search professional."

Regardless of the economy, mid-size and boutique retained search firms have broader access to outstanding, portable executives. Their business models allow for it and thereby they generate larger, quality candidate slates.

Whether or not they are being optimized during the good times, mid-size and boutique search firms take a prominent role in the tough times. Any implied mega-brand advantages of global firms during robust economies is uncertain (and possibly masked during hiring booms), making it difficult to pinpoint their true value as a partner during challenging economies. However, the benefits of mid-sized and boutique firms are clear.

For your search provider portfolio to be most effective, three out of five firms should be mid-sized and boutique. In the end, nothing quite replaces a keen understanding of how corporate performance is linked to the distinct characteristics of large, mid-size, and boutique search firms - particularly during changing economies.

Cook Associates, Inc. is a retained Executive Search and M&A Advisory Services firm. Our core business is creating value at the intersection where talent and opportunity connect, and we are uniquely positioned to help our clients capitalize on the brightest talent and best performing companies in the marketplace.

Our client base ranges from multinational corporations to early stage entrepreneurial companies, private equity and venture capital firms. Brand name clients include American Express, The Blackstone Group, Canon, GTCR, Juniper Networking, Levi Strauss & Co., Pitney Bowes, and SiriusXM Satellite Radio. For additional information, visit www.cookassociates.com.

Kevin Logterman is a Managing Director within the Industrial and Family Business practice areas, based in the firm's Chicago office.

Prior to joining Cook Associates, Kevin served as a Managing Director for The Furst Search Group, a regional search firm focused on senior management searches for Industrial clients. While at Furst, Kevin successfully completed over 180 searches and led the firm's marketing and business development efforts, including the creation of an annual Board of Directors' Survey sponsored by Midwest CEO organization. Clients ranged from family-owned and private equity companies to the Fortune 1000.

Prior to his search career, Kevin held sales and management positions within the manufacturing and banking industries. With over 25 years of business and search experience, he has developed a strong understanding of the competitive challenges facing businesses today and how exceptional talent and cultural fit can impact an organization.

Kevin's experience with Industrial companies includes assignments for private equity, family owned business and global companies. Positions filled include President / GM, all functional leadership roles and Board of Directors.

Of particular interest and area of expertise of Kevin's is in the area of Family Business. As the son of an entrepreneur and someone who has worked in family business his entire career, Kevin has a deep appreciation for the challenges and opportunities that family businesses face in today's world. Search experience includes CEO, President, functional leaders and Board of Director / Advisory Board members.