Search consultants by nature are risk takers. Whether we are owners, managers, recruiters or researchers, every time we pick up the phone, we take risks. We all know too well that the placement process can break down at any time for any reason. This costs us time, money and heartache.
Websters Dictionary defines "risk" as "the degree of probability of loss or injury." Many know that the Chinese character for "risk" translates to "danger and opportunity." By managing danger, we can find time-saving, big-earning opportunities.
Question for you:
Time is out most precious resource. Money can always be made. Once gone, time cannot be replaced.
The same thinking should be applied to our business. How many contingency recruiters feel they make no money 98% of the time? And, that itís in the remaining 2% where the big money is made? What if we can reduce the 98% to 90% -- where we save valuable time -- which increases the 2% to 10%? Doing the math, 2 to 10 is five times our earning power.
How can we apply risk management methods in our aim to make placements? Much has to do with how we manage our time to produce desired results. Weíve all heard it: Those who are well-organized and plan on a daily basis are proven to consistently outperform those who do not.
If I were to call you and ask you four simple questions, could you answer them cold?
The same thinking of risk must be viewed in the placement process. I have a training program called "The Art & Science of Search: 40 Steps to Placement." If weíre working on contingency and the process breaks down at the 38th or 39th step, we earn nothing. Itís happened to us all and it hurts (if our clients only knew!)
In my view, the search business is all about risk management: How to identify opportunities at various stages in the process, how to qualify next steps and how to ensure all goes in the direction to secure a placement.
Letís take a closer look at how we can reduce risk in the three primary stages of the placement process: 1) Client Development 2) Recruiting 3) The "Art of the Deal."
Since 2000, my firm has become significantly more selective in the search assignments we work. In times when many a good recruiter would have reduced their standards to "work a job order," my firm has become more discerning. In fact, since the beginning of 2003, we have turned down about 3 of 5 potential assignments because they donít pass our criteria.
Everyone has different standards for what qualifies as a workable assignment. Some parameters we all know well. In qualifying a client:
If youíve made more than two placements with a client, youíve earned the right to ask for and receive engagement fees. If presented right, you might be pleasantly surprised at the outcome. Try it. This will dramatically save time, boost your billings and reduce your risk.
Ask many recruiters about how they feel about the internet. Since the advent of the web, is the search business better or worse off? Many might agree, "The internet is a phenomenal research tool." Others may disagree, believing itís more challenging now because the internet has increased risk: "Candidates and clients are harder to control."
My firm rarely posts on-line ads. In my view, firms that do, diminish the perception of a search firmís value. Thatís not what weíre paid to do by our clients. As one of my firmís valued clients says, "Mike, if we wanted to post on-line ads, weíd do it ourselves. We donít need a search firm to do that." I agree wholeheartedly.
Letís quickly analyze a candidate received from an on-line service:
We all know the advantages of working with recruited candidates:
"Real recruiting" requires higher level skills and more time investment. Over the long run, this is where we save valuable time, earn significantly more money and reduce risk.
Shrewd clients can eyeball a resume and see on paper whether a candidate was recruited. This is partly what weíre being paid for. It is also a key factor in whether we receive repeat business.
What industry trainers preach and wise veterans know is that thereís one certain path to billing more in less time. And that is reducing risk in the placement process.
The "Art of the Deal" starts at the point when we have arranged an interview for client to meet candidate. Itís our job to drive the process and coach both parties to placement.
As many know well, there are key "leverage points" in the process that, if handled correctly, can significantly increase placement probability. The main ones are:
What are the signs that you have an interested client or candidate? Nothing speaks louder than action (i.e. response from people.)
"Action signs" include:
If a client cuts the cord on a search youíre actively working, find out the reasons why, ask what hiring needs there will be in the near future and ask for an internal referral to another hiring manager who has staffing needs. Youíve earned the "right of referral."
On the candidate side, itís important to ask on an ongoing basis, "Has anything changed since the last time we spoke?" If a candidate does an unexpected about face while in the interview process, find out the reasons why. If for unforeseen circumstances, have a "heart-to-heart" talk, cut your losses and move on.
If motivation is not strong, donít pull the candidate through the process. Theyíll break your heart every time.
Instead, save valuable time by leveraging the relationship youíve built and ask for referrals. Who else does the candidate know who may be qualified for the position? What positions are open with his current employer and who is the hiring manager? Again, youíve earned the "right of referral." In addition, youíll earn great respect from your client by conveying the reasons why this candidate is no longer available.
In summary, reducing risk throughout the placement process is paramount to saving time and billing more, especially for those working on contingency. In the beginning, the methods by which clients are developed and candidates are recruited will have a great impact on your ability to control risk. Always strive for exclusivity.
You may think you have a great client, but if theyíre working with more than two recruiting firms, beware. You may think you have a top tier candidate, but if he/she has applied to more than two companies and/or is working with more than two recruiting firms, beware. In the internet age, we must screen rigorously upfront for both candidate and client activity to reduce risk.
How to guarantee exclusivity? On the client side, receive engagement fees. On the candidate side, receive a signed "exclusive candidate agreement" in which your firm has the sole advantage to work with a candidate for a specified period of time.
Like a great American once said, "I have a dream." My dream is that all recruiting firms receive engagement fees before starting searches. That we donít discount fees and are paid our true value. Imagine what would happen in our industry and to our profession, if we collectively started working this way. In my view, it starts with developing great client relationships. If youíd like my firmís "Great Client Checklist" email me at firstname.lastname@example.org and Iíll send it to you.