Utilitizing Executive Search – When Does it Make Sense?


Tim J. Smith, PhD
Founder and CEO, Wiglaf Pricing

Published July 23, 2003

With so many high-quality executives out of work, one can wonder what circumstances, if any, call for a company to partner with a retained executive search consultant to fill key positions. With budget cut-backs, the hefty fees that executive search firms charge can make it seem even harder to justify. Nonetheless, there are times when it absolutely makes sense to partner with a search professional. Here are three situations as well as some tips for choosing the right recruiter for you.

1. The job specification is very narrowly defined and the successful completion of the search will have a material effect on the future viability of the company.

If a jet engine manufacturer is trying to find a Director, Gas Turbine Combustion Low-NOX Emissions Research, the population of qualified candidates is probably very limited and those individuals are usually employed and not likely to check classified ads or the company web site. In this case, the competent search consultant will invest significant resources to understand the job requirements as well as the elements of fit vital to the successful placement. The consultant will then research and discretely network his/her way to the few qualified candidates, capture their interest, and motivate them to consider making a change. If the candidate is working for a competitor, involving a professional recruiter can provide an additional level of separation, sensitivity, and risk-management.

2. Internal resources are either over-taxed or not capable of handling the work within time constraints.

If a start-up company has to fill 75 sales positions in three months time, it is highly unlikely that the existing (often skeleton) HR staff can tackle all aspects of the searches in-house. Here, the recruiter can supplement company resources as well as oversee the progress of the entire project. More importantly, the search consultant can assist in strategy formulation, compensation structuring, and can even train the interview team and facilitate the delivery of findings.

3. Succession planning and effective recruiting are key to the long-term growth and viability of the company.

The most effective retained search consultants closely partner with their clients and maintain the relationship over time. Understanding the nuances of the company culture requires a significant investment of time and effort, and that effort continues over time. With each search, the consultant becomes more familiar with the client’s organization resulting in decreased search completion times and better candidates presented. Successful companies grow and change rapidly to respond to the needs of their customer and the marketplace. People get promoted leaving gaps while others get lured away. Having a functional relationship with a recruiter in place greatly enhances the ability of the company to respond quickly to these challenges.

Tips for choosing a recruiter.

When choosing a retained search consultant, it is natural to give strong consideration to go with one who specializes in your particular industry or function, but other factors can be equally or even more important. Above all else, look for a recruiter who can effectively partner with you. As in any relationship, part of this compatibility can be learned through experience while some of it is natural chemistry. Questions to consider: Will your work be important to the recruiter? Is he/she hungry enough or will the recruiter focus on larger clients or more profitable searches while ignoring yours? How frequently will you communicate and what is the nature of the reports? What roles should the recruiter play in process? Who will actually be doing the work – especially important as many senior-level search professionals only sell while others actually do the work on a daily basis. How comfortable will you be to have this person represent your company in the marketplace? This is key especially in searches where the population of qualified candidates is narrow for the recruiter will be the first impression of the company the candidate has. Finally, does the recruiter “get it”; that is, do the two of you have good rapport, is this someone you respect, and can you imagine building a lasting relationship together?

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About The Author

Tim J. Smith, PhD, is the founder and CEO of Wiglaf Pricing, an Adjunct Professor of Marketing and Economics at DePaul University, and the author of Pricing Done Right (Wiley 2016) and Pricing Strategy (Cengage 2012). At Wiglaf Pricing, Tim leads client engagements. Smith’s popular business book, Pricing Done Right: The Pricing Framework Proven Successful by the World’s Most Profitable Companies, was noted by Dennis Stone, CEO of Overhead Door Corp, as "Essential reading… While many books cover the concepts of pricing, Pricing Done Right goes the additional step of applying the concepts in the real world." Tim’s textbook, Pricing Strategy: Setting Price Levels, Managing Price Discounts, & Establishing Price Structures, has been described by independent reviewers as “the most comprehensive pricing strategy book” on the market. As well as serving as the Academic Advisor to the Professional Pricing Society’s Certified Pricing Professional program, Tim is a member of the American Marketing Association and American Physical Society. He holds a BS in Physics and Chemistry from Southern Methodist University, a BA in Mathematics from Southern Methodist University, a PhD in Physical Chemistry from the University of Chicago, and an MBA with high honors in Strategy and Marketing from the University of Chicago GSB.