Why Companies Hire Executive Search Firms

Have you ever seen the Google Scholar homepage? They have a beautiful tagline- Stand on the shoulders of the giants. This can be an apt way to describe the role of executive search firms. These firms conduct research on top and high-level organizations and look for C-level executives who are likely to shift to other companies if they get good opportunities. An organization hires executive search firms with the hope of finding that perfect C-level executive who can lead the organization to newer heights.

Back in 2012, the global market size of the executive search industry was 10 billion Euros. The figure snowballed and turned to 18 Billion Euros in 2019. The industry in Australia too logged a growth of 4% during 2015-2020. This proves that executive search is not just any ordinary work but a wholesome process undertaken by serious professionals. The companies find value in services covered under executive search. Melbourne spearheads a market with a size of $558 million. Let us delve deeper and see exactly why companies find it prudent to outsource executive search to specialized hiring firms. Is it just cost or there’s more to it?

1. To avoid heavy-lifting but enjoy the fruits of it

Back in 2001, the future of Yahoo seemed bleak as the dotcom bubble proved to be … just a bubble. At that time, Terry Semel joined Yahoo as a co-CEO after leaving Warner Bros. He single-handedly lifted the company out of the abyss of failure. Within one year, Yahoo became profitable again.

The role of a CEO is thus extremely vital for a company. However, a company does not always have the necessary means and resources to hunt for the best person who can lead the company through thick and thin. If you pay attention to the example above, you will see that Yahoo took in a person who was in the media and entertainment. But Yahoo is a tech company. This proves that the talent pool decreases when it comes to the hiring of C-suite executives. Only an executive search firm can conduct thorough research across the industries to find a person who can be the best match for its client.

2. To maintain confidentiality

Tayo Olukoya was a software engineer at Twitter. Google tried to poach him. However, Jack Dorsey, the Twitter CEO found out about and convinced Olukoya not to leave Twitter. Thus Google could not snatch a talented engineer because the matter got exposed.

The confidentiality factor becomes doubly important when it comes to the hiring of C-level executives. The company cannot approach the potential executives directly as the exposure can lead to all sorts of business politics. If an executive comes to know about the company that is considering him for the CEO position, he might influence the selection process as rightly said by Harvard Business Review. A candidate also needs secrecy so that her current employer does not get the inkling that she is considering a change.

3. To find a better organization-fit

When Indra Nooyi joined Pepsico, there were many skeptics who were not sure of her. However, she helmed the company phenomenally and made it reach new heights. On one hand, her values helped her win over the skeptics and on the other, her love for science urged her to look beyond business.

Only an executive search firm can see the key talents in a candidate that can make him/her be the perfect fit for a company. It can understand if the cultural quotient of a candidate matches with the culture of the organization and if his/her ambitions are aligned with the ambitions of the company. It’s the small things that matter and executive search firms are adept in noticing these small things.

4. Time is precious

The previous CEO of Wells Fargo, Tim Sloan, resigned in March 2019. After that, the bank struggled to get a new CEO for 7 long months. Nobody was interested to be the CEO of Wells Fargo because of the severe difficulties it was in.

When a company spends more time in finding a CEO than in conducting its business, it is a sheer wastage of valuable time. This can be avoided if the company hires an executive search firm. The latter with its deep and wide network and contacts can decrease the time of the search to a considerable extent.

5. To fill in new roles

Stellar advancements in technology are creating new job roles every day. Chief Digital Officer, IoT scientist, data scientist UEx Engineer are some of the new positions that are gaining traction currently. An executive search firm can be of extreme value when a company opens such new positions that need to be filled in fast. The company has no benchmark that it can follow while filling in the new positions. This is where the experience of a top executive search firm comes in.

Bottomline

Helming an organization is just like captaining a ship. There are icebergs or storms. Only an experienced captain with both short-term and long-term vision can keep the ship moving forward avoiding the obstacles. The top-level executives are the greatest assets of the company and finding the right C-suite executive is an art. Look for an executive search firm in Melbourne to help you choose the right captain for your ship.

I am a marketer, reader and re-searcher