Unlocking Cost Savings: How Executive Search Firms Can Help Your Bottom Line
Do you really have the time, resources and connections needed to source the best-fit candidates for your executive roles? The answer to that is almost always: no. This is where an executive search firm like Red Diamond Executive Headhunters can make all the difference.
We combine cutting-edge research, extensive industry experience, and a global network of connections to source hidden gems and rising stars that align with your culture and deliver a tangible return on investment. So you can simply concentrate on what you do best.
Working with an executive search firm is an investment that provides multiple benefits. Outsourcing to a well-connected executive search firm improves your efficiencies and increases the likelihood of sourcing the right candidates, providing cost savings and valuable insights.
Here, founder and Managing Director at Red Diamond Executive Headhunters, Emma Robinson, explains the real worth of engaging with an experienced executive search firm. Not just from a monetary and organisational perspective but also in terms of the wider holistic benefits.
Why is it important for companies to work with executive search firms?
You could find your own people. However, I could probably also do my own marketing and cut my own hair. But I probably shouldn’t! When I embarked upon my business journey myself, someone once told me, “do what you do best and outsource the rest”. I’ve lived by that mantra ever since. So the reason you should use an executive search firm is exactly the same reason why you shouldn’t cut your own hair or do your own marketing.
If you are running a massive production facility – let’s say producing enormous parts for Boeing – you should be focusing on your customers. You shouldn’t be doing my job, just as I shouldn’t be doing my hairdresser’s job. Newsflash: it’s probably going to end in disaster!
What are the financial benefits of using an executive search firm for your company?
If you’re looking to increase your ROI, you’re only going to do that through good people that are well-connected. If you don’t have the connections, you’ll need to stop doing your job to oversee the recruitment process. You’ll have to invest in job boards. You’ll need to understand how LinkedIn works, and let’s face it; it’s a minefield! You’re also going to have to take time out to organise interviews.
Then, after all that, there’s no guarantee that those people you’ve selected are going to work out.
So there are two strands to this. The first one is the fact that going it alone is going to take time and money. Plus, you’re probably inexperienced in this area, and you might not know the right people. Then there’s the other side of it, and that’s whether or not you make the wrong hire. Of course, you can make a wrong hire even when using an executive search firm, but the odds of that happening are much lower.
Therefore, the financial benefits of using an executive search firm centre around the cost savings that come from being able to focus on your core business and finding the right executive for the role. The upshot is maximum productivity and minimal churn, which is a win-win by anyone’s estimations.
Is hiring an executive search firm an investment?
Of course, hiring an executive search firm is an investment. However, it’s one that’s definitely worth making.
When we all set off on our journeys as business owners, and the business is in its infancy, you’ve got no choice but to multitask because you don’t have the funds to do otherwise at that point. But it’s a bit like the same reasons that I don’t wallpaper my own house. It would probably be okay. But I’d sit and look at it and think: “That looks terrible”.
And now we’re going to have to take it down and pay for more wallpaper. Then I’m going to have to take another five hours of my time to do it, and I’m likely to do it badly again.
To give you a different analogy, when you were younger, you might have bought your shoes from somewhere cheap because that’s what you could afford at the time. Now you most likely see the benefit of spending a hundred pounds on a pair of work shoes because they’re going to last a year or maybe even two. A suit is another great example. How many suits have you got in your wardrobe that, provided you don’t suddenly put on 50 stone, you’re probably going to be able to wear again in 10 years’ time?
This is the level of value an executive search firm offers.
If you choose to do it yourself, how many hours of your day are you spending not doing your job? If you are happy to spend all your hours looking for executives, you might save 30 or 40 grand on the face of things. But actually, if you just focused on your job, you might triple that amount. Both in terms of productivity and by the virtue of placing a quality candidate who adds significant value to your business over the long haul.
So when do you learn to let go? There are some things in life that you should just give to experts, and I wholeheartedly believe that headhunting for talented executives is one of them.
What other benefits do executive search firms provide other than financial?
Engaging with an executive search firm can provide a range of holistic benefits that go beyond monetary worth.
A business once told me that they didn’t have any competition. I thought that was incredibly shortsighted. Interestingly, that same company had real problems with diversity, relying on a rigid recruitment policy that dictated that candidates should come from certain universities and backgrounds.
That type of one-dimensional approach just gets you one type of person. Then ten years down the line, you’ve recruited for today but haven’t thought about what’s happening tomorrow. So a big part of my job as an executive headhunter is delivering market mapping and insight reports. We’ve got a really cool piece of kit that provides incredibly detailed market insights.
A client might say, “I want to recruit Sales Directors in the South East. This is my budget, this is my line of work, and these are the people I want”. They might have a clear view of what they’re looking for and what they want to achieve. However, armed with our insights, we could say, “we’re really sorry, but we need to show you what people earn in the South East because you’re out of kilter with your salary. Plus, here are ten companies that are a similar size, with a similar turnover in that region, and this is what they pay their Sales Directors”.
We might tell them, “these are the types of companies that are your competition and will potentially be taking your jobs. These are the types of companies that want your staff. These are the companies that you want to be like. This is what they pay. This is where they’re situated, and these are the areas in which they’re looking to recruit.”
From our report, we might see that company X is heavily employing digital marketers right now. Why is that? Then wham, in a month, you’ll see an article in the business news that says this company has had investment from X, Y, and Z because they’re going to build a new aircraft. So the client we’ve been engaging with is like, “oh, that girl from that search firm told us that in her report!”
What factors should I consider when hiring an executive search firm for my company?
During the pandemic, there was a massive upsurge in recruiters going self-employed. Now, I’ve done this myself. I worked from my dining room table, and although I had absolutely no systems, I could charge 10% because every single penny that was coming in was profit. I made a very healthy living. However, now I have the systems to do three times the amount of work, manage two companies, and provide clients with granular insight reports.
I could never have done all those things when I started, and that’s the point of difference we offer. I’m not saying that there won’t be talented recruiters that are doing this from their back bedroom, but they definitely won’t have the infrastructure that we have at Red Diamond Executive Headhunters. You can pay 10%, but these people aren’t paying for insights. They’re not paying for data and all the other good stuff we can offer.
So don’t be fooled. You get what you pay for nine times out of ten.
I think you also have to be able to gel with the person you’re working with. Not least because you’re going to have to give them all your secrets, so trust and empathy are also really important ingredients to look for when hiring an executive search firm. If you’re not willing to engage with that person and have them as an extension of your company, then it’s not going to work out.
Do they need to be an absolute expert in your industry? Probably not. You need to be an expert in your industry, and they just need to be good at finding people. Their processes are just as important. Never, ever employ an executive search firm if you think a person is chaotic because a big part of our job is being uber organised.
If you can find a quality executive search firm and the dynamics are right, you’ll never look back.