No one has a far-reaching and lasting impact on business success, goals, and accomplishments as its leader. Most companies, especially those with traditional hierarchy, have the final say in decision-making and the most significant influence.
Executives are responsible for directing, planning, and coordinating functional activities in their organizations and typically establish strategies and policies necessary for meeting business objectives. But they also inspire others to reach their full potential and connect with the company's values and mission.
Because of that, executives must ensure people understand and resonate with their actions, information, and plans. Thus, they cultivate the company culture and identify critical problems and the most suitable solutions.
Therefore, these individuals have high-risk responsibilities and business continuity in their hands. That's far from an easy undertaking or a journey one would think without preparing thoroughly.
Every company takes specific actions when looking for a new executive, as this process might take time and more effort than seeking junior and mid-level workers. As a result, executive search has a long history and has transformed drastically in the last decade.
However, the most significant change happened during the pandemic. Here's how executive search has changed over the years, what affected it, and where it's going.
Executive search represents a highly specialized recruitment type, and many companies prefer to use the term headhunting. But regardless of the name, this process involves looking for and attracting qualified senior management candidates that would fill the most demanding roles, such as CEO, CFO, or COO.
Naturally, seeking future executives is different and more challenging than targeting job seekers for entry-level positions. Companies typically work with traditional recruitment agencies when looking for junior job applicants or use their own HR teams for this assignment.
However, recruiters typically hire the most active candidates for entry-level jobs, ensuring their skills and experience match the vacancy. On the other hand, the Board of Directors and executive search firms are in charge of recruiting the C-Suite personnel.
But they also look for passive candidates because the best ones aren’t always looking for a job. The future executive must be the ideal match.
They must be suitable for the job, team, and company culture. Because of that, the search firms and recruitment teams will often reach out to professionals already working elsewhere.
These firms identify the best senior talents in the market and approach them to determine their interest in the offer. Their next steps include extensive competency-based interviews and skills tests.
That process long-lasting impacts a company, as executives have a significant say in business decisions and activities for multiple years. Because of that, companies must choose the executive search firms wisely and identify the most suitable senior candidate.
The executive search became a profession in the 1940s after World War II ended and the US and European businesses started prospering. That increased the need for skilled executives.
As a result, many companies started to seek these leaders externally, including internationally. That demand was also the catalyst for the executive search profession.
Many consultants decided to pursue that career and quit management consulting, as the executive search was more sought-after. For instance, most companies struggled to find experienced executives internally by the 1960s, resulting in a more open market.
Today, the executive search market size is worth $27.8 billion and will likely reach USD 27.9 million by 2028. However, the market size of the executive search industry in the United States fluctuated wildly between 2011 and 2020, mainly due to the pandemic.
Executive search firms and recruiters had a more demanding job before the digital transformation, as they could only rely on their skills and contacts. They had to develop candidate databases, and those with the highest number of profiles would get the most attention from the companies.
If executive search professionals wanted to succeed, they had to make close contacts with skilled job applicants, extensive databases, or experienced researchers who could find top talents. In ideal conditions, they would have all three.
For instance, these professionals had to read newspapers regularly, pay attention to well-accomplished CEOs, and contact them when looking for a candidate with a similar background. However, they would often reach out after a few years, discovering that the executive had already found a job elsewhere.
As a result, that practice became old fast. Executive search professionals also had to contact switchboards from companies from relevant industries and ask if they could connect them with marketing departments.
They didn’t have candidates’ resumes. Instead, these professionals had to ask the right questions to identify whether someone would be a good match.
Hence, they often started with nothing and relied on tips, networking, and leads. The line between the jobs of FBI agents and executive search professionals was thin in the past, as both had to rely on thorough investigation and look for people that were hard to find.
Moreover, these professionals had to make multiple calls to reach the right person, not their assistants, who would often hang up the phone or ask various questions. Executive search recruiters had to be more creative than today because, after all, they were trying to steal skilled executives from their current companies.
Instead of relying on job boards, online databases, social media, and tech apps, they frequented gatherings, dinners, events, and golf tournaments. Older executive search professionals would also have more contacts than the younger ones, thanks to their experience.
Thus, they had no ATS or CRM that would allow them to save candidate data and access information whenever they wanted. These professionals had to collect all data in paper form and manage physical files and databases, which were less accessible.
Executive search underwent various transformations in the last decade, but the increased use of social media, mainly LinkedIn, changed the game. Top-notch technology and networking platforms are the highlights of the 10s, as they make connecting with people easier.
The Board of Directors and executive search professionals could use advanced filters to look for suitable candidates and contact them simultaneously. Tech and social media made it easier to present a company’s brand online and spark interest among potential job applicants.
Data commoditization helped executive search professionals know better-skilled leaders and managers, making it easier to identify a potential candidate in a short time. Today, they don’t have to go above and beyond to discover more about someone’s career history and accomplishments.
Everything is available on the internet, and most professionals enjoy sharing their professional achievements and milestones on their social media profiles, making it easier for executive search firms to detect a potential candidate. However, data privacy laws have also become stricter.
As a result, these recruiters must be careful about handling sensitive information and candidates’ job applications. Diversity, inclusion, and equity have also become non-negotiable, and it is no longer enough to find a skilled executive that fits the company culture.
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Executive search firms must also ensure everyone has an equal opportunity to participate in the process and become a future leader. These values are slowly making the executive search process more accessible and transparent, although there’s still a long way to go.
However, the most drastic change happened in March 2020. According to the HR Director, companies must now reduce executive search costs and cultivate a higher ROI.
Because of that, organizations and search firms must make senior placement quicker and rethink their value proposition. Otherwise, they risk becoming obsolete.
They should reinforce the outsourcing model and consider working with executive search partners to deliver the best results. Companies are also changing their priorities when looking for executives.
Experiences and accomplishments one reached before the pandemic are not as valuable as those gained in the post-COVID era. As a result, search firms now pursue candidates with experience in remote leadership and diverse skills that will help them navigate the future more smoothly.
Deloitte’s report called Finding CFO: How executive search has evolved during the pandemic came to similar conclusions. – CFO candidates must now know how to build virtual ties, be tech-savvy, and have excellent cash management skills.
Packed resumes and persuasive language are no longer enough to land experienced professionals a new executive position. Future leaders should be digitally fluent, flexible thinkers, and able to balance short-term concerns with long-term requirements.
Moreover, they should be eager to continuously learn new things and confidently lead in virtual worlds. More board members will involve themselves earlier in the process to ensure a company is choosing the best match for this demanding position.
Search firms should also understand how incorporating advanced tech into their processes benefits them. The pursuit of experienced executives has significantly transformed thanks to modern technologies, making the job for recruiters easier.
Here’s how tech has changed the executive search in the past years.
Nowadays, most companies and executive search firms use the Applicant Tracking System (ATS) to make hiring easier and find the most suitable candidates faster. This system has an interactive recruitment pipeline, allowing recruitment teams to visualize candidates, clients, and job openings using the view that works for them best.
They can leverage the drag-and-drop pipeline to customize their hiring stages and access every piece of information in no time. Moreover, when executive search times add job applicants to the ATS, they can find resume information, annotations, messages, and job-related feedback in a centralized dashboard.
That helps develop a holistic candidate profile using data they compiled from CVs, social media, or job boards. Thus, recruiters and companies can use the same centralized platform to manage all their sponsored job advertising campaigns.
Every efficient ATS has flexible and advanced search functions, allowing search executive professionals to search their entire databases to retrieve job applicants, contacts, companies, and jobs. This system also instantly showcases relevant and contextual results while the users type their queries.
Executive search teams can leverage the boolean search and look for multiple criteria simultaneously, enabling them to find what they need faster and make the best choice. ATS platforms have various other features that streamline the recruitment process, such as syncing the mailbox and calendar or receiving candidate assessments in their inbox.
That wasn’t possible decades ago, and executive search firms had to do everything manually. But their pursuit has become easier thanks to technology, and they no longer must rely on paperwork databases to keep data and files.
Data sharing was more complicated in the past, and it was hard to track things. That often resulted in a poor recruitment process or taking too long to reach the best executive talent.
But the Customer Relationship Management (CRM) system helps manage email communication, leads, clients, and monitor revenues and candidate placements. Customer-related activities are centralized, making collaboration between the companies and executive search firms smoother.
For instance, businesses can track every activity in a centralized dashboard and reach out to clients with one click. But they can also use CRM to import executive candidate profiles directly from LinkedIn and parse their public information.
Thus, companies can communicate with every relevant party directly from their CRM inbox and share email campaigns and recruitment progress. Finally, they can track placements’ onboarding and ensure every executive is ready for their new work.
Regardless of the job recruiters want to fill, candidate experience is among the critical aspects of a successful process. Otherwise, a job applicant might quit before the selection finishes or leave a negative review, affecting a company’s reputation.
Hence, providing stellar candidate experience is crucial when hiring executives, as they’re the future decision-makers and must have a positive first impression. Before tech evolution, recruiters had no tools or apps to accelerate the process or keep job applicants updated.
But ATS and CRM systems help search firms send timely notifications and reminders to candidates and clients, ensuring smooth collaboration. AI-driven analytics enables them to identify the most compatible job applicant using advanced filters.
As a result, recruiters can send a job proposal faster and onboard top talent immediately. That helps increase candidate engagement and provides a more well-rounded experience that will help with the workplace integration afterward.
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Executive search has transformed a lot in the past few years, but this change is ongoing, and the process will continue evolving in the future. Companies and search firms will focus on growing recruiters with specialized knowledge and skills, as that would allow them to have industry expertise and understand what makes one candidate better than the other.
Search firms will choose their headhunters carefully, ensuring they know how to look for a specific executive profile in a designated market. The executive search will become more complex. Hence, search firms must prepare to develop nuanced knowledge and meet their client's unique recruitment needs.
Companies will have to decide faster what kind of candidate they're looking for and what makes someone the ideal executive. On the other hand, search firms will have to accelerate their processes and find the best match faster than today.
The talent war has created an increasingly competitive market, and the best candidates receive multiple offers in a short time. If search firms fail to react fast and identify the most suitable job applicants, they could lose them to another company.
Moreover, companies will care more about the abilities their executives can adopt than the skills they already have. The world is rapidly changing, and they need leaders who will become non-negotiable for search firms to know how to use modern tech to their advantage to provide an engaging candidate experience.
As a result, they will continue adopting modern systems that accelerate recruitment processes, such as the ATS and CRM. These technologies help take executive search to a higher level, make better-informed choices, and identify top talents faster.
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