Consultancy vs ad agency vs head hunter

By The Drum, Administrator

March 4, 2002 | 12 min read

In today's disposable society, where 'a job for life' seems to be an anachronism, it is important that people don't just jump on the 'I need a change' bandwagon for the sake of it. Like any relationship, you need to take the rough with the smooth and, remember, the grass is normally the same colour across the road. If problems can be ironed out before the boss-employee relationship breaks down then the whole recruitment process, and the normally high associated costs, are negated.

So, first, says Walter Speirs, managing director of Solutions Driven recruitment consultancy, before a person takes the plunge, and leaves you short on staff, you should explore every option within their existing environment: "A lateral move, a new project, or just sitting down with the employee to discuss how to make their job more i) interesting ii) challenging or iii) rewarding can be to mutual benefit.

"I know many friends who have moved company because of 'no prospects' to find a reshuffle soon thereafter, where the office tortoise wins the promotion. So try to make the relationship work."

"However, if it has gone past the point of no return, give yourself time to take stock. Speirs says it is important to choose a good recruitment partner, one who takes time to know you and does what he or she commits to. However, don't think that more is better when it comes to this process. In my day-to-day dealings with candidates, I will devote more time and effort to a client (and tell them so) who hasn't registered with another five consultancies. As for those who prefer to play the field, I wish them well, and wonder how they get on with their five hairdressers, bank managers, lawyers, husbands and wives."

With traditional recruitment advertising, Scottish-based recruiters are able to process well-established data on readership, circulation and reader profile. This has enabled them to carefully plan the thrust of their recruitment campaigns. In contrast, however, the available data regarding online recruitment is sparse.

However, it seems that the current crisis lies in the unavailability of talented individuals in Scotland.

So, is there really a war for talent? "Yes," says Sally McPherson of "Ask any HR professional and they will testify that the fight amongst employers in Scotland seeking talent is all too real."

The skills gap is widening and the talent Scotland needs to fuel its future economic growth is getting harder and harder to find. So, if we accept that the war for talent is real, how do employers fight their battles? Well, you could aim straight for your target with a little help from a 'headhunter'.

Headhunting started after World War II when US companies found their succession plans were upset by men returning from war unable to settle back into routine careers (or not returning at all).

However, headhunting has since found itself with a reputation of being a cloak and dagger affair.

Barbara Robertson of B Robertson Associates says that this image can be justified, although she tends to keep her headhunting gear for 'fancy dress parties': "Clients may be recruiting for confidential reasons - replacing a poor performer, a new venture or replacing a leaver before announcing the departure to clients. For various reasons it must be kept quiet until we have a candidate's interest. Usually, if they send us a CV we can release the client identity. It's like a dance, slowly closing the gap.

"Candidates also want confidentiality to protect their existing career and it is our responsibility to keep them safe."

Often the initial contact is the most important when approaching a potential candidate. Says Robertson: "Our research teams, when approaching a target, keep the conversations short, continuing out of office hours if the person is interested. It is a key element to tell the target enough to elicit initial interest, then build on that. Our researchers are good. It is not easy to get to talk to the right people."

The cloak and dagger image is not the only cliche that surrounds headhunting. The common misconception is that the search is for £100,000-plus jobs only. But, contrary to popular belief, executive search can be used for many middle positions as well as top jobs: "If there is a limited pool of hard-to-attract people who are identifiable, a focused approach to candidates may be easier and cheaper than placing an advert," says Robertson. "When your £5-10,000 budget in the FT or Sunday Times is spent it is gone, regardless of the outcome. £10,000 buys a lot of our time for a tailored search."

This is a view echoed by Peter Gillespie, director of communications at The Search Consultancy: "When people launch their own business the most valuable assets are their experience, their ideas and their ability to drive them forward.

"As your business moves forward you will have many critical choices to make. Perhaps none more so than the people you hire to support you and your business. Yet, when companies need to recruit staff they often look for a shortcut. Companies frequently hire on the basis of a CV and an hour-long chat. They often rely on instinct. After all, they know their business better than anyone else does. It may work out, but if it doesn't, it can end up being an expensive mistake.

"With rates between 15 and 25 per cent of the first year salary it's a cost a lot of small companies can do without. But what is the cost of hiring the wrong person? If a new employee performs poorly the actual cost to a company can be significant. It can also be disruptive for existing staff and, at worst, destructive in terms of image or client relationship. Would that cost your company more than 20 per cent of its earnings?"

This is a view that is mirrored by Andy Reid, managing director of Leapfrog: "Companies have challenges with the recruitment process because their main focus is their business, not usually recruitment. There are business and financial costs attached to the recruitment process that companies may not count along with the cost of advertising. When a company advertises, the outcome is generally a deluge of responses. But do companies miss the perfect candidate due to the volume of response?

"Second, by simply advertising, your main targets are active job seekers. In using this approach a large percentage of potential candidates are being forgotten - maybe if they are not actively seeking they will not be aware of the advert. The perfect candidates are out there but often companies are relying on the candidate finding the advert. If a company has its best interests at heart should it not be trying to find the best candidates?"

However, recruitment is often the last thing on an employer's mind during a recession as budgets are pulled, plans reshuffled and the focus is, often shortsightedly, switched to the short term.

There is a real irony in the approach that some managers take to recruiting in a downturn, says Nicola Denholm, director of ID Recruitment: "Just when managers should be willing to pay a premium for finding the best people they succumb to cost-cutting. This very quickly leads to a downward spiral in the human talent that is the very thing they need to steer their company through the troubled waters of economic recession."

Arshad Okai, managing director of Quantum Recruitment, agrees. The skills needed by both managers and employees during a downturn often change significantly, says Okai. When the market is good it is easier to make money, but when the market flops there are only two ways to approach this change: "Either you can train existing staff and change strategy to move in line or, alternatively, you could bring in new blood, from the outside. People who are suited for the task at hand.

"But during this period the key members of staff become even more valuable. The people who are not performing will be the ones to be let go. So, with this in mind, it is important to attract the right people because quality can be even harder to find."

"Advertising positions can be very expensive, especially in the more traditional platforms," continues Okai. "It is never guaranteed and is often hit-and-miss."

"Once you take into account the cost of the advert, the administration time, the interview and the rejection letters, it works out 10-15 per cent cheaper to use a consultancy than it would be sourcing the operation internally. In fact, I would go as far as saying it would be cheaper for big firms to shut down their HR departments and subcontract all their employment problems."

This sentiment is backed by Denholm: "Another irony that crops up in tough times is that this can be exactly when there is a great surplus of candidates. So, for the inexperienced manager - and since it is ten years since the last recession most managers are inexperienced in dealing with this one - it is very tempting to say 'our budget's tight, there is no shortage of people, let's handle recruitment ourselves.' This is the biggest mistake they could make, for three reasons.

"Tough times mean people should be concentrating on doing the job they are qualified to do. Second, there might be a lot of people, but quantity doesn't mean quality. And, furthermore, In a period of low wage inflation, recruitment agency fees are a small investment given the returns achieved by quality people."

This is a view subscribed to by Reid too: "In essence, it is important for companies to drive their business forward in a down-market as there is the potential to gain more physical market share.

"It is also a fantastic opportunity to attract key individuals away from your competitors."

How to... get headhunted

1 Manage your public profile - make sure you are seen at appropriate conferences, seminars and industry events. This will help to build your profile amongst your professional peers.

2 Participate in company publicity - If you have the opportunity to be included in company publicity, get involved.

3 Improve your accessibility - not returning calls is a grave mistake and leaves the executive search consultant with a negative impression.

4 Make sure that you have enough time to be involved in all stages of the process - If you don't have time to listen to what the consultant can offer, you are not ready to be headhunted.

5 Build a worthwhile professional relationship with the search consultant as an executive search firm can help you in future career moves.

6 Be candid about your experience and salary expectations. Be prepared and willing to answer frank questions about your salary expectations and work experience.

7 Research your search firm - make sure that your search firm has the relationships with the companies you want to target.

8 Keep up to date on industry happenings, buzz-words and emerging technologies.

9 Be properly prepared for any interviews you might have - It is necessary for you to be proactive and fully involved in the recruitment process from start to finish.

10 Keep your CV up to date - preparing your CV in a rush means you may leave out vital information.

How to... succeed in hiring

1 Keep your commitments and make telephone calls when promised. The candidate begins to form opinions of the company even before the first interview.

2 Be prompt. Schedule interviews as soon as possible. Respond quickly after an interview. While you are contemplating an offer, candidates will continue to interview.

3 Remember that interviewing is a two-way street. Your objective is to not only gather information, sell your organisation and the position, but also to sell yourself.

4 After you interview a candidate, utilise the services of a head hunter to determine their level of interest. A headhunter worth his or her salt can provide you with candid and useful feedback information.

5 When you have decided to make a job offer, work closely with your headhunter to structure the package. They can obtain a verbal acceptance before you present the offer. Do not make blind offers.

6 After the candidate verbally accepts the job offer send out a confirmation letter, not an offer letter. Offer letters often allow for a two-week response time, and this will encourage some candidates to use your offer as a lever to negotiate a better deal with their current employer or other prospective employers.

7 The greatest enemy in the hiring process is time. The longer the time span from initial candidate contact to projected starting date, the lower the odds of a successful hire. If there is no relocation, insist on a start date within two weeks of acceptance of the offer. If relocation is necessary, insist on a date within four weeks.


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