01. I HAVE AN HR DEPARTMENT AND A BOARD OF DIRECTORS. WHY DO I NEED AN EXECUTIVE SEARCH FIRM?
HR rarely has the resources for a senior-level search, and directors are busy. “It takes a lot of research to find the right person,” says Janice Ellig, co-CEO of New York-based firm Chadick Ellig.
A search firm has a network of connections. “We’re retained to go into companies where we know these executives are already superstars,” says Bob Damon, president, North America for Korn/Ferry International.
02. DO YOU WORK ON CONTINGENCY OR RETAINER?
A contingency firm receives a lump sum once an executive is hired; a retained firm gets paid throughout the process, typically three times.
Some argue that companies on retainer are less likely to abandon a challenging search. If you’ve received no payment, “the motivation to stick with a very tough search is not there,” says Jeanne Branthover, managing director at New York-based firm Boyden.
03. HOW MUCH WILL THIS COST?
The industry standard is a third of the first year’s cash compensation—including bonus—for the position being filled.
04. DOES YOUR FIRM HAVE OFF-LIMITS ISSUES?
A company’s talent can become “off-limits” to a search firm once the company employs said search firm. Obviously, such conflicts reduce the size of your hiring pool.
05. WHAT IS YOUR EXPERIENCE IN MY INDUSTRY?
You want your firm to know your business sector, but “too much industry experience can lead to a lack of diversity of thinking,” Damon says. Another potential issue: the off-limits problem. A firm with experience placing executives at the level you’re looking to hire (CEO, CFO, COO, etc.) matters more than industry-specific work.
06. HOW OFTEN WILL YOU BE IN TOUCH THROUGHOUT THE PROCESS?
Most firms provide weekly status reports to clients; be wary of those that don’t.
07. HOW WILL YOU ASSESS POTENTIAL CANDIDATES?
Qualifications are important, but so are a candidate’s personality, leadership style and emotional intelligence. You need a firm that has processes to evaluate both the tangible and intangible factors. “A lot of people will be qualified—the question isn’t really what they’ve done, but how they went about doing it,” Damon says.
08. HOW SUCCESSFUL HAVE YOU BEEN ON PAST SEARCHES?
There are three ways to quantify success: placement rate, stick rate and the amount of repeat business a firm receives. Ask how many searches a firm has taken to the point of an accepted offer, and how many of those placements remain on the job.
09. WHAT DO YOU DO AFTER THE OFFER IS SIGNED?
“While the search itself is very important, what happens after is equally important,” Damon says. The firm should work with the board and the new hire to make sure that the onboarding process goes smoothly.
10. WHAT IS YOUR SERVICE GUARANTEE?
Most search firms offer some insurance. “If the hire leaves within their first year, we will replace them at no additional cost,” says Branthover.
For more information, contact: Janice Ellig, Chadick Ellig, [email protected], 212.688.8671; Bob Damon, Korn/Ferry, [email protected], 310.843.4133; Jeanne Branthover, Boyden, [email protected], 212.949.9400 ext.230.
