The truth of the matter when engaging a retained search firm for multiple key staffing needs is they produce far better candidates, have much deeper relationships in the industry they are working in and have a search process that in the end delivers candidates who can meet or exceed the objectives of the role in which they are hired into.
Many company’s HR and Talent Acquisition groups think more short term than long term when it comes to staffing critical roles. The long term strategy is most often used – a combination of career site branding, job boards and job aggregators, LinkedIn talent solutions, and using multiple contingency search firms to help build a large database of potential candidates.
What is missing is that for critical roles that must be filled with quality new hires, the long-term strategy rarely works. Even though using RPOs and contingency search firms will result in the most resumes, it is pure folly to believe quality is the main driver produced by those outsourced means. Therefore, engaging a retained search firm is the best of all options when outside recruitment help is needed.
Let’s look at the recognized statistics in the global workforce. The majority of all workers – approximately 55%, are “C players”. They are literally just bodies taking up space.
They show up on time, can perform assigned tasks assigned such as software or QA engineer, customer service, inside sales, operations, manufacturing and production roles. But the reality is that they don’t develop intellectual property or design anything new;
They are not problem solvers, entrepreneurial or creative and contribute virtually nothing to increasing market share or improving P&L ratios. In addition, many “C players” are just not good employees. Often a lack of upwardly mobile skills, education, and more equates to lack of motivation outside of a repetitive paycheck.
Next are the “B players” who make up to 35% of the workforce, have real education and skills, contribute to developing IP, producing revenues, or some other vital contribution. However, the cream of the crop is approximately 14% of the workforce known as “A players”. From janitor to CEO every type of role has their “A players”. What is so great about hiring them? Leadership IQ and SHRM have developed studies and surveys that demonstrate that “A” players” produce 8 to 10 TIMES MORE than even “B players”.
Reasons for Engaging a Retained Search Firm
With over 30 years of experience in the executive search business, we have rarely seen contingency search firms or RPOs deliver “A players” and have no consistency in delivering “B players” for clients to consider. How do we know this?
- In a less than a 5% unemployment rate environment, most exceptional professionals are happy where they are now in terms of their role, their employer, and compensation. If they were to become passive candidates and look to make a change due to desiring new challenges or relocation, they would simply network and reach out to hiring managers in their industry directly. They rarely look at job postings and have no need to post their resume to a job board. They will not fill out an online application on any company career web site. They are bombarded with emails, InMail’s, and calls every day from corporate recruiters and contingency search firms who generally speaking fail to understand these professionals will likely only speak or reply to an actual executive hiring manager or a retained executive search consultant with a solid reputation among industry Board of Directors and CXOs.
- Contingency and RPO firms rely heavily on job postings and job aggregators. But many of those applicants are the unemployable, unemployed, or “C players”.
- In large contingency search firms the recruiters are graded on the number of send outs (resumes that need to be sent daily to meet a quota). And RPOs have a LOT of clients. Ask yourself, as a client, how much of a priority are you to a recruiter working on 12 to 25 searches at a time? What type of quality and search process would you expect?
I’m not knocking contingency recruiters. I used to be one before I changed to retained almost 20 years ago. Why did I make that move? One, I realized to really have clients as a priority and deliver a superior service, I personally could only work on 3 to 4 searches at a time. To do more than that means both the client and my reputation suffer. Two, with using a search process that was very sound I knew the methodology would unearth those “A players” so I could assess and deliver proof that the shortlisted candidates I presented could meet or exceed the expectations and objectives of the role and client required of the new hire.
As for cost and benefit analysis, the benefits of using retained search is overwhelming while the costs are not much different than contingency search fees.
- When looking to engaging a retained search firm, you are assured that the vetting and development process are superior as you usually receive only 3-4 shortlisted candidates for each role.
- Retained Search provides detailed interview and assessments including current / prior KPIs, depth of industry relationships, and similar accomplishments relevant to the new role.
- Team fit analysis and Target Candidate Profile – by conducting brief online surveys of the stakeholders for each role (team the role will work within and key internal customers), a team profile allows the recruiter to use behavioral analysis and assessment to determine how the potential candidate will fit in and affect team dynamics. One-way behavioral testing of candidates never works as it fails to have anything to measure against.
- Much longer retention of new hires from retained search firms. For instance, 94% of our placements are still working for that client after 4.5 years.
- Superior Replacement guarantee – most contingency firms incorporate a 30 to 90 days refund or replacement. Retained search firms are often 6 to 12 months. We believe in our process so much that we offer 24 to 36 months replacement guarantee depending on the assignment.
- Success based search fees – this is relatively new for retained search firms but a practice we have used for the last 5 years. With most large retained search firms, you pay 100% of the fee regardless if the outcome was successful. Other search firms like NextGen Global Executive Search are performance based. After the initial deposit, the remainder of the fees are paid based on deliverables, including the hire.
- Flat based fees – this is also a relatively new concept. This arose out of the obvious conflict of interest associated with compensation-based search fees. If the recruiter negotiated a higher compensation that was agreed to by both client and candidate, the search fee increased. While some retained search firms use the same fee for every search on a flat fee basis, at NextGen we realized we are being paid for our work. Therefore the basis of the flat fee is appropriate to each role depending on factors such as limitations on relocation, the actual candidate pool size, the number of hours expected in research, search strategy, recruiting, and delivery.
For instance we have clients in the Bay area, NYC and Boston who funny as it sounds believe few exist outside their geography that are worthy of consideration as they often think of themselves as the center of the technology universe. Additionally, for some roles the candidate pool overall is small such as AI architects and power electronics design engineers.
Engaging a Retained Search Firm for filling multiple roles
As retained search firms are like good lawyers and executive management consultants, we ask for a deposit,. This means the client is a priority as they have “skin in the game”, knowing the search firm has a track record in longer retention and producing exceptional new hires. So, the overall flat search fees mean that engaging a retained search firm is clearly the best choice.
When we think of cyber threats to endpoints, typically what comes to mind is the need to protect our PC’s and laptops. Many more businesses are adding comprehensive security solutions and user policies administered to include mobile threat exploits.
But it’s unquestionable now that mobile phones are just as likely (if not more likely) to be targeted by cyber criminals. There are a few reasons for that. The first reason that mobiles are now a legitimate target is the sheer number of them. It’s estimated that there will be over 6 billion smartphones in use by the year 2020. That’s around 70% of the world’s population using a smartphone in 3 years’ time.
Modern smartphones are now small computers. The processing power, functionality, and the way we’ve integrated them into our lives make them a treasure trove of valuable information and easy food for hackers wishing to use mobile threat exploits. And IoT Botnets further increases the vulnerability of cloud based data and mobile devices.Many people today use their mobile phones to access online banking and as a physical payment method in store. Cybercriminals tend to follow the money and so are putting resources into targeting mobiles. Last year, security vendor ESET discovered a form of malware that presented a false version of online banking login screens to steal credentials.
Exposing Vulnerabilities of Mobile Threat Exploits
Like any operating system, there is a continual process of discovering vulnerabilities and attempting to patch them before hackers can take advantage.
This can be complicated on the Android OS. Android is open source, allowing stakeholders to modify and redistribute it to fit their needs.
This means that when mobile threat exploits and vulnerabilities are fixed at the source, it doesn’t always translate to the problem being resolved for the user.
The most famous example of this is the Stagefright vulnerability. This was mobile threat exploits in the code library associated with media playback. If a hacker sent malicious code within a video via MMS, the attack could be successful without any interaction from the user. This vulnerability was said to affect 95% of Android users making patching a nightmare. Although there had been previous serious vulnerabilities in Android, such as FakeID, TowelRoot, and PingPong, this was the first exploit of this scale that could be successful without any user input.
No OS is Safe
Typically, we see most of mobile attacks targeted at Android devices. But iOS is not completely bulletproof. XcodeGhost was a copycat version of Apple’s development environment, used for creating apps. Developers that used the rogue version of Xcode to create their apps unwittingly delivered their product to the App Store with the malware in tow.
Mobile Threat Exploits Protection Starts with Education
So clearly, we need a robust plan in place to protect mobile devices from mobile threat exploits. But how do we go about this? The first thing to consider is user education. When using a laptop, most people know not to open attachments from unknown sources. But mobile users are not always as careful. Educate them to apply this same level of caution to mobiles; only downloading apps from trusted sources and giving the application, the minimum permissions required to perform its task.
Management is Not Security
Your company likely already has an Enterprise Mobility Management (EMM) solution in place. This is useful for managing a fleet of mobiles and preventing opportunistic crimes by enforcing passcodes, for example. But EMM is not sufficient to protect against more advanced threats, and most suites don’t have the functionality to detect, analyze and respond to cyber attacks. For this reason, it’s important to supplement your EMM with a Mobile Threat Defense (MTD) product.MTD has far greater mobile threat exploits threat-detection capabilities and can help to prevent man-in-the-middle attacks, detect non-compliant or malicious apps, and spot jailbroken devices. It’s important to have this level of security on your mobile devices due to the amount of corporate data that can typically be accessed via mobile now.
User-Based Access Controls
A cloud-based Identity as a Service (IDaaS) solution can also help to increase security. The benefits of this to a business are two-fold: For the user, all their corporate systems can be accessed via a single sign-on (SSO). This eliminates the need to remember multiple login credentials.It’s likely to be a multifactor sign-on process which is more secure than a static password. IDaaS also allows users to be automatically granted certain access rights or privileges based on their role. Employees get the right tools to complete their job function and no more. This means that in the event of a mobile threat exploits, the compromise, the amount of accessible information can be limited.
As mentioned, patching mobile devices is not always straightforward, particularly in Android ecosystems. Updates can be blocked by Google, the handset manufacturer, or the mobile operator. However, this situation has improved since Stagefright. Even given these difficulties, it’s important that you have a process for keeping your operating systems up to date. This should be easy to configure in your EMM solution.Ultimately, we don’t need the statistics to tell us that mobiles are here to stay in the business world; we see evidence of this every day. Mobiles are now integral to huge chunks of our working lives. And because of this, the threat from hackers will continue to grow.
What steps are you taking to ensure that mobiles aren’t an easy attack vector into your business? And do you feel that your users are as educated on mobile threat exploits as they are about conventional PC-based malware?
Cyber-attacks are amplifying across the globe. Personal cyber security is important as not only have they becoming more frequent, but they are also impacting a wider band of digital terrain. A single worm, like WannaCry is capable of infecting countless systems in numerous ways, from email accounts to personal data to service disruptions and other critical disturbances. The impact and frequency has led to billions of dollars’ worth of damage, to include lost productivity. Damage to an organization’s reputation is not even calculable.
Budgets are growing tight due to the continued cost of cyber security protections and investigations. While this regularly effects large organizations, small to mid-size businesses are also seeing an increase in cyber-attacks. Hackers are turning toward smaller targets because they are less likely to have secure infrastructure and even less likely to know they are under attack. A worm or virus can sit in a computer system for months and without an in-house IT team, small businesses are especially vulnerable.
Personal Cyber Security Thwarts Hackers
A target that is even smaller than a small business is you. Personal cyber security is becoming more relevant as hackers seek out any vulnerability. But if small businesses can’t even afford an IT team, and if large organizations are finding their budgets shrinking due to cyber security costs, then how can an individual protect themselves?Personal Cyber SecurityCompanies like Rubica are offering personal cyber security options that protect individuals, and the businesses they own or work for, from cyber-attacks by providing easy-to-use and affordable cyber security options.
I rarely recommend any company’s products or services, but Rubica has options and features that warrant a serious look by executives and Board members alike.
Far too often individuals do not adhere to security protocols because the protocols are too complicated or time-consuming. People take short-cuts to avoid tedious passwords or log-in requirements.
Doing so on your personal device is risky, but when your personal device is also synced to business applications results can be catastrophic. By providing employees with personal cyber security features, Rubica protects individuals and businesses.
Some of Rubica’s defining features include its mobile ready app that can be downloaded on desktops, tablets and smart phones. There is no need to install hardware or receive staff training on its use. The app is backed by Rubica’s signature concierge service. The cyber ops team is on call at any time. But users rarely need to contact Rubica since the security app and service does its work without the user even knowing.
Personal Cyber Security Solution by Rubica
Rubica’s cyber ops team provides personal cyber security to any user who has downloaded the application. Once downloaded, the cyber ops team is able to monitor your data, identify threats and alert you when necessary. By paying attention to personal behavior patterns, the team is able to deduce when an imposter has entered a network.
If the idea of data and behavioral monitoring is not a price you are willing to pay in exchange for personal cyber security, then don’t worry. Rubica can be turned on and off. Users are able to access the app and view activity graphs, review investigated events and ask Rubica staff questions about their data or any ongoing threats. Rubica’s personalization means that your personal cyber security choices just got more personal.
Require the rolodex and expertise of an executive search team?
NextGen has a solid track record in identifying and recruiting “A players” – the top 14% of the workforce that produces 8 to 10 times more than even “B platers” – AND these “A players” exist at every level from lead software developer to cyber analyst to Director of business development to VP of Cyber Counterintelligence and much more. We recruit for red, blue, and purple teams for cyber defense contractors and DoD as well as private sector cyber security needs.
Increasing new hire productivity requires making sure the new employee can hit the ground and produce. Behavioral assessment (sometimes referred to as “Psychometric Testing”) has become increasingly recognized as a valuable source of information when making hiring decision.
There is a wealth of data to demonstrate that using behavioral assessment in conjunction with sound, responsible recruitment methods reduces employee turnover, and it’s quickly becoming standard practice for many employers and recruiters. But by and large behavioral assessments are not used properly.In addition, is it really worth the additional time and expense? In the current economic climate is behavioral assessment REALLY an essential for your next recruitment campaign?
The answer is: YES with a CAVEAT. towards Increasing New Hire Productivity
Here are three points why increasing new hire productivity works when behavioral assessments are used properly. What is a general consensus among most companies is this usually involves a questionnaire that asks the candidate about their opinions, preferences and priorities.
Based on the results, and by comparing the answers against years and years of historical data and expert analysis, the individual’s attitudes and behaviors can be extrapolated.
Behavioral reports can include information such as preferred working environment, how they respond to tight deadlines, preferred management style, approach to selling, and much more.
If you’re skeptical, ask one of your employees – preferably one you’ve known for many years – to take an assessment. You’ll likely be surprised at just how inaccurate the results are.
1. Defining the Role Fit and Team Fit = Increasing New Hire Productivity
Figuring out exactly the kind of candidate you’re looking for and creating a job description to match can be a time-‐consuming headache. But a simple survey of the stakeholders of the role (direct report, internal customers, the top employees already in that team the new hire will work within) can then be put into a Composite survey that will produce a detailed description of the ideal characteristics you’re looking for, many of which can be inserted straight into your job description. There is virtually no scientific proof that performing a behavioral assessment of candidates alone will result in a “good hire”
To be successful in evaluating candidates and making the right hire so that increasing new hire productivity is the goal, once you know they fit the role in terms of tangible skills, education, and experience, but t,he fact that 46% of all new hires fail within the first 18 months, according to Leadership IQ, it is vitally important to measure the intangibles in the role fit and to assess the candidate’s impact on team dynamics. And here is where so many Hiring Managers make a HUGE mistake. The one-size-fits-all “corporate culture” is used to assess candidates across the board. But the truth is that ALL teams are unique and EACH has their OWN CULTURE which may align in some ways with the corporate culture statement. An accurate behavioral assessment of a potential candidate is when it is measured against the team composite profile. In particular, you need to measure
- Values and Motivations and how the potential candidate’s views and needs impact team dynamics
- Relational Communications Traits – how the candidate is able to listen as well as sell his/her ideas to the team
- Conflict Resolution Skills – many of post Baby Boomers were not taught this skills, so training is essential if hiring
- Decision Making Traits – can he/she make a valued fast decision or do they delay and waiver inconsistently?
2. Conducting Fewer Interviews
A resume or LinkedIn profile can somewhat tell you whether a person has the ideal qualifications and job history but usually it’s impossible to tell if a person has the right attitude and accomplishments until you interview them. Behavioral assessment done the right way, on the other hand, can provide you with that information in a fair and objective fashion. So if, for example, you have 7 candidates that look great on paper, a team fit and role fit scientifically based assessment can help you reduce that shortlist to a more manageable number, and leave you with a much faster interview process.
3. Customized Mentoring / Coaching = Increased New Hire Productivity
Quick assimilation – faster or rather increasing new hire productivity and longer retention. It’s the goal for EVERY Hiring Manager. An often overlooked feature of team fit and role fit profiles and behavioral assessments is its ability to tell you the training and management styles to use to get increased new hire productivity. Getting your new recruit up to speed quickly and making them feel comfortable in the role is not only a time saver but it also reduces the expenses incurred through downtime.
We’ve already mentioned the fact that behavioral assessment reduces employee turnover, but have you ever stopped to consider just how expensive and time consuming it can be to replace a bad hire? Aside from the fact that you have to spend time and money, repeating the recruitment process all over again, you also have to repeat the expense of on-boarding and assimilation for the eventual replacement.
And it’s almost impossible to put a price on the potential for lost business and the reduced employee morale that occurs while the position remains vacant. Although prices vary quite a bit, the average cost of behavioral assessment is often far less than employers imagine. And any one of the above four points would more than justify the additional, modest investment.
But put these three elements together and you have a potential saving of time and money that represents tens of thousands of dollars. Especially in consideration of reducing employee turnover. So, the question is not whether you can afford to use behavioral assessment. The real question is… Can you afford NOT to use behavioral assessment?
NextGen Global Executive Search – Increasing New Hire Productivity
Get an inside look at how NextGen uses this behavioral assessment with award winning Leadership Vault Recruiting process. NextGen Executive search provides retained and engagement recruitment services for clients who build and service aerospace power systems, UAVs, drones, and stealth tech; artificial intelligence, machine learning, and augmented reality; cyber security and cyber defense; industrial automation, robotics, industrial power system, renewable energy, and fossil generation; medical devices and electronic health records; mobile networks, digital media, embedded wireless, IoT, and cellular infrastructure. Compare our search process and fees compared to other search firms by clicking the image below or contact us today.
The cost of failed executive hires is tremendous. This is NOT limited to just CXOs and SVPs – same goes with VP and Director levels. It is surprising how many mid-cap and large conglomerates retained big-named search firms without realizing that with the exception of a few principals that manage the business and no longer recruit, most of the recruiters for these big firms are a revolving door. They flow in and out according to economic times. Boards should look towards smaller well-established retained executive search firms who have experts that have been working there for a dozen years or more and have a solid history of recruiting in your niche industry.
The cost of failed executive hires is not only damaging – it can prove to be fatal. First are the costs related to the executive compensation, benefits, and severance package, as well as indirect cost such as travel, poor strategy and poor business plan execution, lost market share, lack of direction for the rest of the staff, and lack of trust in the Board of Directors. I see it all the time where I not only need to find a replacement CEO, CTO, CFO, or SVP, but also one that has turnaround experience and is willing to come into a situation that is not ideal for immediate success.
Several times over my career in Executive Search I find myself working with a candidate who believes they are an ideal fit for a retained search assignment I am conducting. My retained search work is “performance based” NOT contingency based, which means that when a client has paid a deposit for my time and effort, I am expected to get the job done.For an executive search consultant, getting the job done means nothing short of bringing forward high-impact “business changing” candidates to our clients. These are the “A Players“. Not only must they have the required experience, expertise, and a proven track record of success, but he/she must prove to me that they can meet the challenges of the position, meet or exceed my client’s expectations, and make a “direct positive impact” on my client’s business.
Most fail to understand the impact on the cost of failed executive hires is. The truth is that by and large, about 55% of all employees at any given company are in fact “C” Players. They can do the job they were hired to do; they show up for work on time, do the job they were assigned, and are loyal to their managers. However, they lack the entrepreneurship risk taking mentality, the “take charge” attitude, and the take no prisoners’ mindset required to make an impact on the marketplace. In addition, they are easily replaced by outsourcing at a lower cost as well as artificial intelligence, software automation, and robotics. And the latter three can run 24/7 without sick days, benefits, training, and their performance is most often anything but mediocrity.
Avoiding the Cost of Failed Executive Hires
While for many positions it is acceptable until technology advancements eliminate many “C” players, companies will continue to hire them for many roles. At functional leadership and key engineering, sales, and operations the cost of failed executive hires can be fatal. Many VPs and Directors will look to “B” players, which based on my 20 years experience in executive recruiting, are roughly up to 30% of all employees at any given company. They outperform “C” players any day of the week and possess the intuitiveness and hunger to succeed that makes them valuable to their employer. They have a track record of success, albeit in their department but rarely make a definitive impact on the company’s overall performance in the marketplace or the business strategy.So what really is an “A” player? The misconception is that “A players” only exist at the executive level. That is purely a myth. Most “A players” were born that way or evolved into it in childhood, teenage, or young adult years. These unique individuals comprise the Top 14% of the global workforce. They are easily recognized early on. In their youth, they were leaders and entrepreneurs – whether having the most lawns to cut, starting a community newspaper, excelling in Junior Achievement or inventing a product or service company that was acquired by a bigger fish.
These “A players” are not always leaders as their ideas, thought processing, and inventiveness make them excellent engineers. Same goes with RSMs and MAMs who can blow out the quotas as an individual, but if you try to move them into leadership levels they fail. The strategic thinker and the ability to “sell their ideas” type of “A players with superb interpersonal communications and conflict resolution skills are in fact the type of functional leader or senior corporate executive that is a “game changers” not only within a client’s vertical market, but have had similar success in other vertical markets within that industry or in a different industry altogether. They have a responsibility to the owners (founders, investors, and stockholders).
Cost of Failed Executive Hires is due to a poor Talent Acquisition Process
A Forbes article by a Silicon Valley CEO reveals that the cost of failed executive hires is estimated to be more than $500,000 or 2.5 times salary. And that does NOT include organizational, opportunity, productivity, and transitional costs for the new executive. As an Officer or Board member, you must ask yourself, why would you risk letting mediocre executives hires to occur?The same can be said of a VP of Engineering who needs principal level systems software engineer for that matter. You may save yourself a few dollars in the short run recruiting someone with your existing recruiting process, but the long term effects in the cost of failed executive hires may cost YOU and YOUR STOCKHOLDERS much more than 2.5 times salary or a recruitment search fee.
How to Alleviate the Cost of Failed Executive Hires
NextGen Global Executive Search not only reduces the cost of failed executive hires, we virtually eliminate them. The award-winning Leadership Vault search method, developed over 30 years, is a the recruitment platform utilized by our executive search consultants that properly measures the potential candidates we identify by psychometrics to determine a strong match to role fit and team fit, document KPIs and the depth of candidates’ industry relationships, and provide a custom onboarding program that includes new hire self-development planning and a mentoring / coaching program that is easy to realize with little investment of time. Backed by an industry leading 12 to 36 months replacement guarantee, the common feedback is the hire we placed met or exceeded their objectives. Looking to fill a key functional leadership or senior executive role in your company? Reach out and see the difference engaging an Executive Retained Search will make to the quality of candidates you will interview. We don’t get paid in full until you are 100% satisfied.