Hiring a new executive is a big deal. You need to make sure you’re getting the ideal candidate through your doors, especially since the consequences of a bad hire in this area can be incredibly costly. Data from the U.S. Small Business Administration reveals that a bad hire can cost 1.25 to 1.4 times the individual's base salary.
You can imagine how those costs can spiral out of control when a bad hire is in a C-suite level position. And that doesn't include the hidden costs: lower morale and possible bad executive decisions that could derail entire departments.
With the help of an executive recruiting firm you can avoid the cost associated with a bad hire and get the right hire that fits your company the first time. This article will discuss executive recruiting, the value of executive recruiting firms, and how you can use them to find the best executive candidates for your organization.
What Is Executive Recruiting?
For many businesses, the default maneuver for making any new hire is posting a short description on a job board and waiting for resumes to pour in. While this kind of methodology can work for entry- and lower-level positions, executive recruiting requires a more thoughtful approach (especially CEO recruiting).
So, what can an executive search firm do? Here are their responsibilities:
Focus On Filling Executive High-Level Positions
If neither you nor your hiring manager has experience seeking out executive candidates, you’re likely going to exhaust resources, time, and money — all without any guarantee of finding the right hire.
In executive recruiting, the individual or recruitment agency will almost exclusively work with executive candidates and businesses in need of top-level hires. As a result, they are more likely to have a proven track record of finding top executive candidates and placing them with companies where they best fit.
Perform the Most Rigorous Candidate Searches
When hiring for entry- or mid-level roles, you may be satisfied reviewing a candidate’s resume or LinkedIn profile before moving on to interviews. In executive recruiting, the searching and screening processes are far more comprehensive.
Rather than waiting for candidates to apply for positions, executive recruiters (sometimes referred to as “headhunters”) search for both active and passive candidates (executives employed elsewhere who aren’t necessarily seeking new employment opportunities). Typically, recruiters collect significant data about a candidate before ever making contact or scheduling interviews.
Recruit for Multiple Industries or Specialize in Certain Fields
All industries need executive talent, but this doesn’t mean that every executive recruiter or firm will recruit for all industries. Some may work with businesses in multiple industries, while others may only specialize in a single niche.
Why Companies Need Executive Recruiting
Executive positions are challenging to fill — and that’s largely because executives play a vital role in a business's health and direction. It takes a special skill set and unique insights to craft long-term goals and ensure the business is progressing toward those goals.
What’s more, executive-level employees are in high demand, and the talent pool is relatively small.
This is what makes executive recruiting essential. Recruiting firms have the tools, connections, and expertise to find the perfect person to fill an executive role.
Recruiting Externally vs. Promoting Internally
Leaders often debate whether it’s more beneficial to recruit senior executives from outside the company, or promote from within. There are pros and cons to each method. What works for one business may not work for another, especially since this issue also depends on your organization and the personnel you have available.
When you recruit externally, you get to work with a blank canvas — and a bigger talent pool. In fact, this is one reason why many organizations choose to recruit externally. If your organization is small enough, you may not have the human resources available to promote internally.
However, recruiting external candidates also presents your team with more unknowns, which we’ll explore more below.
Pros of recruiting externally
- Your talent pool expands drastically, enabling you to pull in qualified candidates with traits and skills you may not otherwise be able to access.
- You can create a custom profile for your perfect candidate — plus a wish list of qualifications you’d like your new executive to possess.
- It’s an opportunity to bring in a fresh perspective from the outside.
Cons of recruiting externally
- The search process and hiring process can prove long, difficult, and costly.
- While you can vet prospects, there will be unknowns that you’ll only learn after you’ve hired them and had a chance to work with them.
- When you promote from within, you promote someone who already has deep knowledge of your organization — whereas an outside recruit will need more time to familiarize themselves with your organization.
Just as with hiring externally, promoting internally has its own set of positives and drawbacks. Again, you’ll need to make the choice based on your organization’s unique needs, but this list of pros and cons may be a good place to get started.
Pros of promoting internally
- Promoting internally means you’ll move someone to the C-level who already has existing knowledge of your organization and company culture.
- While you’ll still need to train the person you plan to promote, training needs will be less than with an external hire who needs to start learning the basics about your company from scratch.
- You can save costs on talent searches, interviews, and other aspects of the hiring process.
Cons of promoting internally
- You may not currently have employees you feel are prepared for a promotion.
- Depending on your company culture and available qualified candidates, listing a C-level position for promotion may cause rivalries between team members.
- While you’ll be promoting someone who already knows your company well, you won’t be bringing in fresh new insights from outside your company.
- You take on all responsibility for talent acquisition since a recruiting firm will be unable to help.
What Do Companies Typically Look For in an Executive Hire?
If your business has an open position for an executive role, you likely already have a long list of qualifications, skills, abilities, and traits in mind for your new hire. But are they the right qualities?
It can differ between industries and organizations, but in general, most companies searching for the best talent are usually looking for the characteristics and traits listed below.
Significant Industry Experience
Unlike the average employee, who may get plenty of time for onboarding, training, and growth, executives need to be able to step into a leadership role and immediately make an impact. This not only requires leadership experience, but also experience within your industry.
The familiarity with the industry (and the industry’s technical knowledge and language) makes it easier to lead confidently and effectively. That said, there are some virtues to hiring an executive from outside your industry.
- An outsider is someone who hasn’t developed bad habits. They bring a fresh, new skillset to the table.
- People can also become set in their ways, developing blind spots over the years. Someone without industry experience won’t have those blind spots — and the new perspective can be a breath of fresh air.
- A new perspective also means new ideas, which can help your organization innovate and potentially become even more competitive.
As you can see, while industry experience is typically a must-have, there are also times when the reverse is true — especially if you’re hiring for positions like chief financial officer, where many of the responsibilities will be somewhat similar between industries.
Exceptional Communication Skills and Leadership Ability
Communication and leadership go hand in hand. The best candidates will always be effective communicators.
What’s more, candidates should be well-versed in a variety of communication styles. In any given department, people will be more or less responsive and receptive to different styles of communication. Good leaders can identify the best channels to convey ideas and directives with timeliness, clarity, and sensitivity to the company’s culture and individual or departmental preferences.
Good Match With Company and Industry Culture
For positive culture to permeate throughout an organization, it needs to start at the very top with your owner, executives, the board of directors — the entire leadership team. When you make an executive-level hire, it takes a unique combination of soft skills, values, personality, and self-awareness, on top of the traditional hard skills C-suite roles require for a candidate to be a good fit.
This is one of the biggest reasons organizations often search for candidates with relevant industry experience: because these are the people who are most likely to be familiar with the usual culture within the industry and the typical culture within organizations that are part of that industry.
What Does an Executive Recruiter Do?
The senior management recruitment process is quite different from (and more difficult than) hiring entry- or mid-level employees. Executive recruiters focus on filling the C-suite positions such as chief executive officer, chief operating officer, chief financial officer, chief information officer, and other executive positions including executive director, vice president, etc.
A good recruiter will take on most of the time-consuming hiring duties on your behalf: wading through resumes, screening candidates, and scheduling waves of interviews. Most recruiters stay current with trends in their field, and that means using the latest recruitment methods and technology to help them make better, faster decisions than a hiring manager.
They’ll also have access to broad talent networks featuring both active and passive candidates. Overall, this means you’ll gain access to a much greater number of qualified candidates than you’d receive simply by putting out your own job postings.
How Does an Executive Recruiter Market Your Company to Prospects?
An often overlooked part of the job search and talent search process is the ability to sell your company to prospects. At the executive level, it’s not always about candidates marketing their skills to you, especially if you’re going after passive candidates. The other part of the equation is making your organization attractive to potential hires, and executive recruiters have the experience and skills to market your organization effectively.
One concern that some may have when working with a recruiter is whether the recruiter will be able to identify the best possible culture fit for a particular organization since the recruiter is not personally employed at the organization.
The truth is that top-level recruiters will have a wealth of experience with all kinds of companies in various sizes and niches. This gives them deep cultural insights that enable them to search for the perfect culture fit.
Think of it as an outsider who has a top-down view of your organization, someone who can see the whole picture. Compare this to your hiring manager, who is immersed in your organization and may not be able to assess the subtle cultural differences that set your particular company apart from others in your field.
Getting the Most Out of Your Executive Recruiter
When hiring an executive recruiter, you’re leaving much of the complicated hiring tasks to someone with more experience. However, this doesn’t relieve you of all responsibility. Use the tips and tricks below to ensure that the hiring process goes smoothly and that you get the most out of your executive recruiter.
Vet Your Executive Recruiter or Agency Before Hiring Them
Hiring a recruiter is similar to the process you’d generally use when you’re staffing other positions. Just as you would research candidates if you were handling the hiring process in-house, you should research executive recruiters before you choose one.
Get started by creating a list of important questions to ask before bringing a recruiter on board.
- Ask how they handle candidates that don’t make it through the selection process.
- Learn about how they use data to help with recruiting.
- Find out how they measure the quality of a hire.
- Ask recruiters how they handle candidates who aren’t a good fit for a role. Find out how they’ve dealt with these situations in the past and what they learned from the experience.
Keep in mind that not all recruiters are the same. Design your questions to get a clear picture of what your executive recruiter can do and what they agree to provide.
Clearly Communicate Information About Your Company and Culture
When you’re hiring an executive recruiter, one of the most significant advantages is that you’ll rely on them to find that perfect cultural fit. As such, one of the first things you’ll need to do is make sure that the recruiter has a complete picture of your organization — plus the industry, niche, hiring challenges you’ve faced, hiring needs, and more.
With all of this, remember that there’s no need to market yourself to the recruiter. The recruiter will do the work of marketing your business to prospective candidates — and to do that, they’ll need the most accurate information possible. Ignore the temptation to paint a rosy picture and instead provide them with as many objective facts as possible.
Provide as Much Detail as Possible Regarding the Executive Position You Need To Fill
Having a clear understanding of the open position, including the responsibilities and expectations of that role, is vital in helping your recruiter find the best possible fit for the job. Make sure your recruiter has a complete list of requirements for your new hire — education, certifications, experience, and skills.
On the flip side, also be ready to temper your expectations. In a perfect world, you’ll always be able to find candidates with exactly what you need, plus tons of experience. But in reality, most of the time, you’ll find a selection of candidates who are a close but not necessarily precise match.
To that end, it’s helpful to discuss with your recruiter how to prioritize your requirements.
Ask Your Executive Recruiter About the Methods That They Will Use
Particularly if you’ve been unsuccessful in placing executives in the past, you want to make sure that your executive recruiter will bring new strategies, methods, and technology to the table to help you land the best possible candidate for the job.
Maintain a Clear Line of Communication With Your Executive Recruiter Throughout the Entire Process
The best way to convey and manage expectations throughout the hiring process is to maintain a clear line of communication with your executive recruiter. Although you’re handing off all the searching, screening, and most interviewing duties to your recruiter, the process should still be collaborative. Here are some tips for setting up a good communication cadence:
- In the beginning, work out a clear roadmap for you and the recruiter to follow throughout the process.
- Check in often to make sure you and the recruiter are always working toward the same goals.
- After you make the hire, it’s worthwhile to follow up with your recruiter on the hire's success — or lack thereof. This helps the recruiter improve their own processes, which will make the process even better the next time you need to hire an executive.
Executive Recruiting Simplified – Hunt Club
Ready to find the right executive for your organization? With Hunt Club, your organization has access to our network and deep talent pool. Our team of industry experts can help source top talent for your established business or startup. We’ll do the hard work of sourcing and qualifying candidates, giving you more time to handle what matters the most: growing your business.
Learn more about how Hunt Club can help your business bring in quality talent today.