Why Search Firms Must Adjust and Adapt to Changing Times

Meeting the challenges of an industry in flux requires resourcefulness and a willingness to change. One executive recruitment veteran offers a roadmap to the future. Here’s the second of a two-part series.

The executive search industry, and the business world it serves, continues to undergo a transformation that no one would have predicted even a decade ago. According to one industry leader, recruitment firms that respond quickly to those changes, make adjustments and adapt will not only survive the years ahead but thrive. Some of those responses will be tangible, said Jorg Stegemann, CEO of Kennedy Executive Search & Consulting, such as search firms becoming more transparent. But others call for a new way of thinking and looking at clients, candidates and the ecosphere in which they reside.

Mr. Stegemann, who heads one of the top 25 networks of independent executive search firms, recently held a seminar, ‘The Future of Recruitment,’ in Budapest. Based on his own deep experience and the input of colleagues, peers and his network in the Czech Republic, Denmark, Germany, France, Hungary, Italy, Monaco, the Netherlands, the U.K. and the U.S., Mr. Stegemann offered his insights into what the world of search will likely look like, and demand of its participants, in the years ahead.

1) Mid-Level Recruitment Firms Will Disappear

“No company should pay a fee anymore for routine staff functions, such as in accounts payable or junior sales,” said Mr. Stegemann. “This kind of recruitment – the traditional niche of smaller recruitment firms – can and should be done in-house, via LinkedIn or an advertisement.”

The situation, however, is different at the top of the pyramid, where executive search firms are summoned to find the talent for senior strategic roles. Often, these are direct searches, sometimes confidential in nature. And they demand a consultative approach.

“I have one client who actively involves me in her strategy formulation,” said Mr. Stegemann. “She asks me what I see and hear in the market, what her competitors are doing, where they succeed and where they fail. This kind of service will prevail.”

On the lower end, temp staffing should remain, Mr. Stegemann predicted. “If you have a construction site and need five workers tomorrow at 5 a.m., you need a staffing company,” he said. “But the firms in the mid-level, the transactional firms, will have a hard time.”

2) The Word ‘Customer’ Must Be Redefined

“Stop thinking in the candidate and customer box!” Mr. Stegemann implores recruiters. “The only difference between these two is that a) one is currently looking for a new job and b) one is currently not looking for a new job.”

Too often, he said, recruiters will say, ‘I will call you Friday.’ If they are talking to a customer, they will almost certainly make that call on Friday. If they are speaking to a candidate, no one can say if that call will ever be made.


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But that is a big mistake. “Everything is a huge network,” said Mr. Stegemann. “Treating candidates and clients alike sounds like a small step for a recruiter. But it would be a huge step for the industry. Clients and candidates will no longer tolerate this behavior.”

3) Demographics

A shortage of talent is already upon us, and most industrial nations have too low a birth rate to fill all of the job openings. “Do you find it difficult to find the right talent today?” asked Mr. Stegemann. “Are you planning for the middle management jobs you will need in five years? And senior leadership? Ideally, these people are on board today. How do you develop and keep them? How do you build a talent pipeline?”

Employer branding is key, said Mr. Stegemann. “If you want to attract ‘the best talent,’ make sure you are ‘the best employer.’ Treat your employees like customers or they will go to your competition.”

4) You Need to Be Easy to Contact

Mr. Stegemann told of deactivating his American Express credit card because he was unwilling to go through the hassle of calling a number, listening to a robot and choosing among options one, two, three or four on the phone tree and then holding the line for another three minutes. “Neither do I stand in the line in front of a shop to spend my money,” he said. “I am the customer and want to be treated as such. Same for candidates.”

If you still have a registration form on your homepage, he recommended, switch it off. If you have job advertisements out, make sure to include a name and direct email address. “Candidates can choose today,” said Mr. Stegemann. “Do your homework to be chosen. Be complimentary. Show you are an attractive employer.”

5) A More Dynamic Labor Market

Regular changes are an essential part of a competitive and dynamic career path today. For many, the life duration of a job is three years – year one to learn it, year two to get results, year three to confirm them.


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“This is good news for executive search,” said Mr. Stegemann. “Our services will be much needed in the future. Yesterday, a client might have been angry if we found a candidate who left in three years. Tomorrow, it is likely we will be recruiting for the same function for the same client regularly.”

6) Focus On Service, Quality and Transparency

Search firms are being challenged daily by clients and candidates alike. As with most other services or products, would-be customers are comparing offers, checking feedback on recruiters or verifying profitability. Most of that information is but a mouse click away.

“We must be more transparent, report better and in more detail and adapt more to our clients if we want to stay in business,” said Mr. Stegemann. “Our industry has often been accused of being an arrogant one. The times where candidates and clients were willing to accept this are over. Recruiters who are arrogant or non-responsive won’t last long.”

Change occurs faster today than ever before. Search firms must adapt or create that change for themselves. “In this industry, much can be improved,” said Mr. Stegemann. “And much must be improved. As always, the fittest, most serious and best search firms will stay.”

“Recruitment is the most ethical job in the world: We help candidates make a career step forward and companies to find that very talent they need to achieve their goals and make economies turn. The future looks bright – at least, when you do the right things and when you do them right.”

Andrew W. Mitchell, Managing Editor

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Will Schatz, Managing Editor – Hunt Scanlon Media

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