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The rapid pace of change in European executive recruitment continues to accelerate. Twenty years ago, there were but a small handful of tried and trusted ways to recruit the right senior manager or executive. Today, the landscape is rather more complex. Our research among over 1,200 senior managers and executive across the UK and Continental Europe explores the methods organisations use to recruit, employee retention, priorities in executive recruitment, experience of job boards and recruitment agencies, social media, and measurement of recruitment.
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THE HIRE IMPERATIVE
Executive recruitment tools, practices andviewpoints in the UK and Continental Europe
“
a”
In just the past three years,LinkedIn has moved from
being used by 33% ofmanagers and executives
to search for a job, and only 10% of hiring
managers to find them, toalmost universal usage
Introduction 1
Survey Methodology 2
Determination of Process for Recruiting Management & Executive Roles 3
Priorities and Issues Driving Recruitment 5
Executive Transitions: Retention and Turnover 8
Employee Retention 10
Recruitment Methods 13
Philosophy of Search: Broad or Narrow? 17
Motivation of New Employees 18
Experience and Viewpoint on Job Boards 19
Viewpoint on and Experience of Executive Recruitment Agencies 21
Selection of Recruitment Service Provider 24
Social Media 25
Measuring Recruitment 28
Outlook on Future Executive / Management Hires 30
Contextual Factors 32
A War for Talent? 33
Conclusion 35
Contents
Introduction
The rapid pace of change in European
executive recruitment continues to accelerate.
Twenty years ago, there were but a small
handful of tried and trusted ways to recruit the
right senior manager or executive: run a print
ad in the most relevant business or trade
journal; run a print ad in the national
newspapers’ “appointments” section; or
engage an executive search firm. Job boards
were on the scene, but more actively used on
roles only up to middle management, for
technical positions and in some non-European
parts of the globe.
In just the past three years, LinkedIn has
moved from being used by 33% of managers
and executives to search for a job, and 10% of
hiring managers to find them, to almost
universal usage. Even Facebook’s role is on
the rise among executives and the people
who hire them. Other tools and methods,
which a few years ago were in nascent stages,
continue to grow. Large global brands are
taking executive recruitment in-house and
building their own “candidate communities”;
umbrella preferred supplier relationships
govern all recruitment suppliers in many
organisations; outsourcing and other tactics
are also at work. In addition to the impact that
these new options are having within the
companies that choose them, the changes
have sent shockwaves through various entities
involved in sourcing talent. An example:
Recruitment advertising at one international
newspaper used to be a business worth tens
of millions of pounds annually. Today,
recruitment advertising is largely online and
generates less than £10 million per year.
To inform our understanding of our clients’
habits and preferences, in 2012 Executives
Online surveyed our clients, prospects and
registered executive candidates. The online
questionnaire had over 30 questions
and covered:
• The methods their company or
organisation uses to recruit managers
and executives
• Employee retention methods
• Their priorities in executive recruitment
• Their experience of job boards and
executive recruitment agencies / suppliers
• Use of social media
• Measuring recruitment effectiveness / ROI
Their answers are illuminating and in many
cases surprising.
We hope you enjoy reading.
James O’Brien
Managing Director
1
To inform
our und
erstanding
of our clients’ hab
its and
preferences, in 2012 Executives Online surveyed
our
clients, prosp
ects and
registered
executive cand
idates
Our surveys were conducted online in mid 2012,
among more than 1,200 senior executives across
Europe, who are either registered with us as
candidates for interim or permanent roles, or who
have used or enquired about our services. The
survey consisted of over 30 questions in which
respondents were asked their views on the priorities
and issues driving recruitment, executive retention
and turnover, various recruitment methods,
employee motivation, job boards, executive
recruitment service providers, social media,
measurement of recruitment, and their outlook for
the future.
The data were subsequently tabulated and analysed
to uncover insights by industry, role of responder,
country and performance in other metrics and
provide content for this narrative. This finished
report follows the order and structure of the
original survey.
2
Survey Methodology
Because of their importance to the organisation, executive hires are
often the result of a collaborative process between the hiring
manager (usually the person the role reports to) and the company’s
Human Resources function. Control of the process, however, can
vary. To understand where decision-making on the recruitment
process and method resides, we asked our clients, prospects and
registered executive candidates who decides the method and
process for that recruitment, once the company or organisation has
decided to recruit a senior role.
In almost half of all companies, the HR / in-house recruitment
function sets the process, with 47% of respondents answering that
HR decides. In 36% of companies, the line / hiring manager
decides. Reflecting the collaborative process, fully 17% of
respondents said that some other entity chooses how the
recruitment will proceed. The comments given by respondents in
that 17% “Other” grouping indicate that, most often, the decision is
made jointly by HR and line management, or driven directly from
the top of the company, with the CEO or even the board deciding
how to proceed. In other situations, external service providers, such
as executive search consultants or external HR advisers,
set the tone.
Asked to comment on whether the usual method is chosen via
formal policies or on an ad-hoc basis, respondents answered more
strongly (in a ratio of 2:1) that policies were formal rather than ad
hoc. However, numerous comments also indicated that the process
is flexible, and collaborative: “There are formal recruiting processes
but the decision on the method to recruit is on a case by case
basis at senior levels”, “[There is a] Formal underlying process with
flexibility depending on the role being recruited”, “Ultimately the
decision lies with HR, but we always consult with the business to
ensure an appropriate solution is reached”,“We have a formal
group wide policy, driven by group procurement, to ensure most
economic solutions are deployed. Flexibility exists to recognise
specialists and experts, but only to the extent they reduce fees to
the level of the rest following market review. Preferred supplier
panels are in place and strictly adhered to”.
There is a strong correlation between company size and the role of
HR in setting the recruitment process. The larger the company, the
more likely it is that HR decides the method and process
for recruitment.
3
Who decides recruitment process?
HR / In-houseRecruitment
Function47%
Hiring Manager* 36%
Other17%
* the person to whom the new employee will report
“...executive hires areoften the result of acollaborative processbetween the hiringmanager (usually theperson the role reportsto) and the company’sHuman Resourcesfunction.”
Determination of Process for Recruiting Management & Executive Roles
That HR involvement increases with company size is not really
surprising, as the existence of a focused HR function (or even
person) within a company requires a certain level of scale to justify
it. Smaller companies are less likely to even have a dedicated HR
department, and therefore HR can’t play as much of a role in setting
the process for executive recruitment. However, the movement of
decision-making away from the hiring manager is concerning. Less
than one in four hiring managers in bigger companies have the
primary say in how their people are recruited, which may have an
impact on their satisfaction with the process.
The strength of HR in setting the process also varies by industry,
with respondents in the Healthcare / Medical, Industrial /
Manufacturing, and Media / Marketing / Entertainment / Advertising
industries being more likely to report that HR decides the method
and process for executive recruitment. In the Business Services
sector, which has a higher proportion of smaller companies in our
sample, the hiring manager is more likely to set the process.
4
Determiner of recruitment process – by company size
No. of Employees
Key
Percentage
0
20
40
60
80
100
0-50 51-250 251-1000 1001-5000 5001+
32% 43% 56% 62% 67%
45% 36% 31% 29% 23%
23% 21% 13% 9% 10%
HR / In-house Recruitment FunctionHiring Manager
Other
Priorities and Issues Driving Recruitment
Given a range of options related to desired employee profile, recruitment
process execution and cost, respondents were invited to state what they
considered to be the main priorities and issues that drove their
recruitment practices – or say what “other” items are important to them
(with no limits placed on the number of items they could indicate in their
response.) Their responses are summarised in the table below.
Respondents’ answers demonstrate their focus on the desired
outcome – that is, the identification and engagement of people
having the correct profile for the role in terms of skills, prior
experience, and cultural fit, with skills being the most important.
Encouragingly, relatively fewer respondents answered in a way that
prioritised the process – its speed, labour-intensiveness, use of
particular new tools, or cost – over the outcome. Cost of recruitment
stands out as the “process point” that is higher on respondents’
minds than the others, with 24% indicating cost as a main priority
in recruitment.
In Executives Online’s earlierresearch on permanentrecruitment, “ExecutiveTalent”, published in 2006,respondents were asked toindicate a similar set ofissues and priorities asimportant. Six years on,cultural fit and speed ofrecruitment are unchangedin how they appear in therespondents’ ratings.
People management has leapt up in importance, with 53% ofrespondents mentioning it, versus 27% in 2006. Finding people whohave more relevant prior experience is also more important, with48% of respondents naming it a main priority, versus 33% in 2006.(Anecdotal reports across Executives Online’s recruitmentbusinesses bear this out. In the continuing recessionary / uncertain
climate, clients are looking to de-risk each executive recruit by hiringsomeone who has “been there, done that”, in terms of therequirements of the role. Transferable skills and experience are farless in demand.) Cost of recruitment is also more on people’sminds, with 24% mentioning it in 2012, versus only 17% in 2006.
5
Finding people with the right cultural fit
Finding people with the right skillsFinding people with the right track
record / prior experience
Finding good people managers / leaders
Speed of recruitment
Labour-intensiveness of recruitment Keeping up to date with current and evolving
recruitment best practices
Cost of recruitment
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Main recruitment priorities – percentage of respondents citing
Finding people with the right cultural fit
Finding people with the right track record/ prior experience
Finding good people managers / leaders
Speed of recruitment (time from initiationof search to new employee starting)
Cost of recruitment
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100
Comparison between 2006 and 2012
%
20062012
50%56%
56%
71%
48%
53%
18%
7%
6%
24%
33%48%
18%18%
17%24%
27%53%
Asked to identify the single main challenge or priority in recruiting
senior managers and executives for their company or organisation,
we see again the importance of profile, especially skills:
6
Belgium & Luxembourg
France
Germany
Republic of Ireland
Italy
The Netherlands
UK
Average
Findingpeople withthe rightcultural fit
Findingpeople withthe rightskills
Findinggood peoplemanagers /leaders
Speed ofrecruitment(time frominitiation ofsearch tonew
employeestarting)
Labour-intensiveness
of recruitment
Keeping upto date withcurrent andevolving
recruitmentbest
practices Cost of
recruitment
Recruitment challenges – variation by country
Findingpeople withthe right
track record/ prior
experience
61%
58%
53%
59%
41%
67%
68%
56%
68%
71%
77%
75%
79%
64%
67%
71%
46%
43%
49%
53%
41%
54%
56%
48%
64%
52%
58%
59%
48%
42%
54%
53%
24%
15%
25%
20%
9%
16%
25%
18%
9%
4%
6%
8%
4%
2%
14%
7%
7%
7%
8%
0%
6%
5%
7%
6%
20%
23%
24%
27%
25%
15%
31%
24%
There were no meaningful variations in these priorities by company
size or industry. We do, however, see variations in priorities and drivers
by country. Respondents from the United Kingdom, Belgium and The
Netherlands were more likely to state that finding people with the right
cultural fit for the organisation is a main challenge or priority, with the
quest for appropriate skills being less of an issue. In Germany, the
Republic of Ireland, Italy and France finding people with the right skills
is a relatively bigger driver of recruitment. The search for people / team
management abilities drives executive recruitment more in Belgium,
Germany and the Republic of Ireland. Speed of recruitment is more
important in Northern European countries and relatively less important
in the Southern European countries in our sample. The UK appears to
be the most cost-conscious of European nations in our study when it
comes to buying recruitment services, and the UK also notes the
labour- intensiveness of the recruitment process on internal staff as
more of a challenge – perhaps an opportunity for a service provider
with a cost-effective pricing model that takes more of the “production”
time and effort of recruitment off its clients’ desks.
Finding people with the right cultural fit
Finding people with the right skillsFinding people with the right track
record / prior experience
Finding good people managers / leaders
Speed of recruitment
Labour-intensiveness of recruitment Keeping up to date with current and evolving
recruitment best practices
Cost of recruitment
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Single main recruitment challenge
19%
32%
18%
21%
4%
1%
1%
3%
This heightened awareness of all the challenges and priorities that
can emerge in executive recruitment is probably to be expected from
the function that bears responsibility for attracting and retaining talent.
Asked to name the single main challenge they saw, the HR and line /
functional managers’ answers were more similar, with the most
important issues emerging as profile elements of the desired hire,
such as skills, experience, culture and people management abilities.
Line managers were more likely than their HR colleagues to cite
finding relevant prior experience / track record in the target employee
as their most important priority, whereas HR managers tended to
view the highest recruitment priority as “skills” related. Non-executive
directors rated people management ability as the most important
aspect in focusing recruitment – at a rate more than double that of
HR managers and 50% more often than the line and functional
managers. Very few respondents mentioned cost or speed of
recruitment as the single main priority, but HR managers were twice
as likely to do so as respondents from other backgrounds.
Finally, it is interesting to note how priorities vary according to the
role the respondent occupies in the organisation. Asked to name
any and all main challenges and priorities they perceived in
recruiting senior managers and executives, HR managers had a
much longer list. Their focus on and awareness of the recruitment
process and its vagaries are generally higher than that of their non-
HR colleagues. By large margins, more of them mentioned finding
people with the right cultural fit, finding people with the right track
record and prior experience, speed of recruitment, the labour-
intensiveness of recruitment, and cost of recruitment as main
challenges and priorities in recruiting senior managers and
executives, compared to their colleagues in line or functional
management roles, or non-executive directors.
7
HR
Line manager
Functional manager
Non-executive director
Average
Findingpeople withthe rightcultural fit
Findingpeople withthe rightskills
Findinggood peoplemanagers /leaders
Speed ofrecruitment(time frominitiation ofsearch tonew
employeestarting)
Labour -intensiveness
of recruitment
Keeping upto date withcurrent andevolving
recruitmentbest
practices Cost of
recruitment
Recruitment challenges – variation by role of respondent
Findingpeople withthe right
track record/ prior
experience
67%
60%
53%
47%
56%
71%
70%
72%
73%
71%
59%
49%
45%
51%
48%
56%
53%
54%
55%
53%
29%
16%
19%
18%
18%
18%
8%
6%
4%
7%
6%
6%
6%
5%
6%
32%
25%
23%
24%
24%
“Line managers weremore likely than theirHR colleagues to citefinding relevant priorexperience / trackrecord in the targetemployee as theirmost important priority”
8
Executive Transitions: Retention and Turnover
If employees stay in the company or organisation and are applied to its work in such a way that they are
productive and satisfied, recruiting replacements for leavers becomes less of an imperative. On the other
hand, sometimes it is best for the organisation and the employee if they part company. We asked several
questions about these issues, and the methods and practices companies are using to retain their
managers and executives.
Asked whether they have been challenged with retaining valued executives and management staff;
exiting under-performing staff; downsizing / redundancies; and succession planning, roughly 40% of
respondents indicated that yes, these were challenges they had faced.
Respondents could also indicate a challenge other than the four choices above. Among other
challenges related to a company’s ability to keep and maintaining the workforce it wants, respondents
mentioned “getting executives working with each other as a team”, “adapting management to new
challenges”, “management staff not supported by general direction from board”, “defining executive
roles”, as well as the launch and exploration of a new business necessitating different skills – all of which
have an impact on staff retention, engagement and performance.
Asked which of these was the single most challenging issue, retention and exiting under-performers
emerged as the more prevalent challenges.
Retaining valuedexecutives
and management staff Difficulties in exitingunder-performing staff
Downsizing /redundancies
Succession planning
Challenges faced in retaining or exiting staff – percentage of respondents citing
43% 42% 37% 37%
Retaining valuedexecutives
and management staff Difficulties in exitingunder-performing staff
Downsizing /redundancies
Succession planning
Challenges faced in retaining or exiting staff – percentage of respondents citing as main problem
30% 27% 22% 18%
If em
ployees stay in the co
mpa
ny or o
rganisation and are ap
plied to
its work in such a way that they are produ
ctive and satisfied, recruiting
replacem
ents for leavers becom
es less of an impe
rative.
9
There were no meaningful variations in perception of these issues by company size or by industry,
although we do see a correlation between employment tenure by company size and industry. Generally,
the larger the company, the longer the tenure. The smallest companies’ average tenure rate, at 5.9 years,
is well beneath the average of 7.2 years, and the largest companies’ average tenure sits well above
average at 9 years.
We also observe variations in tenure by industry, with companies in the Media / Marketing / Entertainment /
Advertising and IT / Telecoms / Technology sectors having shorter employee tenure than companies in
the Industrial / Manufacturing, Financial Services / Banking or Building / Construction sectors.
0-50 employees
51-250 employees
251-1000 employees
1001-5000 employees
Over 5000 employees
Average
0 1 2 3 4 5 6 7 8 9
Average tenure of management and executive employees by size of company (in years)
Years
5.9
7.6
7.5
7.1
9.0
7.2
Business Services
Building / Construction
Financial Services / Banking
Healthcare / Medical
Industrial / Manufacturing
Media / Marketing / Entertainment / Advertising
Professional Services (Law, Accountancy)
Retail / Distribution
IT / Telecoms / Technology
Transport / Logistics
Average
Average tenure of management and executives by industry sector (in years)
Years
6.4
7.5
7.8
7.2
8.4
5.5
6.7
7.0
5.8
6.6
7.2
0 1 2 3 4 5 6 7 8 9
10
Is employee turnover structural, or due to the actions taken by particular companies to secure the loyalty of
their staff? It seems that practices designed to retain employees, including training, deferred compensation
in the form of deferred bonuses and stock options, career planning (identifying optimal next roles in the
organisation) and offering flexible working (such as work from home, reduced working week, flexible /
variable hours, etc.) do have an impact. Companies in the lower quartiles in terms of their reported
employee tenure are less likely to have such incentives and programmes in place to encourage loyalty.
Deferred compensation is perceived as the most effective practice to encourage employee loyalty by
companies that achieve all levels of employee tenure. Among the companies of respondents reporting
the longest tenures, however, the respondents believe other factors – notably career planning – are
producing the result.
Respondents’ perceptions of which of these is the most effective, however, are mixed.
Training, mentoring,coaching
Deferred compensation
Careerplanning
Flexibleworking
Programmes in place to retain staff, by level of tenure achieved
47%
62%
53%
55%
Bottom quartile
Lower middle quartile
Upper middle quartile
Top quartile
46%
54%
54%
54%
37%
39%
41%
52%
36%
43%
39%
40%
Training, mentoring,coaching
Deferred compensation
Careerplanning
Flexibleworking
Programmes cited as most effective in retaining staff, by level of tenure achieved
17%
18%
15%
14%
Bottom quartile
Lower middle quartile
Upper middle quartile
Top quartile
36%
28%
34%
25%
24%
27%
27%
35%
11%
21%
15%
17%
Employee Retention
11
If we look at the results by country, we see that across all countries in which survey respondents were
located, retention and exiting under-performers were more likely to be the most challenging issues,
compared to managing redundancies or succession planning. However, in some countries, either
retention or exiting under-performers is more prevalent as the most major challenge.
In France, Germany, the Republic of Ireland, Italy and the UK, approximately equal proportions of
respondents rated retention and exiting under-performers as the most challenging issue. In the Benelux
countries, retention issues dominate compared to exiting under-performers. We suspect that the
difficulties encountered in exiting under-performers may correlate to the different employee protection
laws in place in these countries. There may also be cultural drivers at work, with employee mobility being
greater and generally viewed as a desirable thing among the working populations in some countries.
Employment tenure also varies by country:
Retaining valuedexecutives and
management staffDifficulties in exitingunder-performing staff
Downsizing /redundancies
Succession planning
Challenges in retaining / transitioning staff, by country
40%
28%
30%
23%
29%
32%
30%
Belgium and Luxembourg
France
Germany
Republic of Ireland
Italy
The Netherlands
UK
22%
32%
32%
20%
27%
22%
31%
19%
19%
17%
30%
26%
31%
18%
18%
15%
20%
25%
18%
15%
19%
Belgium & Luxembourg
France
Germany
Republic of Ireland
Italy
The Netherlands
UKAverage
0 1 2 3 4 5 6 7 8 9
Average tenure of management and executive employees by country (in years)
Years
7.9
8.8
5.9
7.8
6.5
7.5
7.2
8.2
We also asked survey respondents to describe how, or if, they saw
the relationship between external recruitment and internal
promotion changing. Their comments put some colour behind the
figures, with the consensus being that as there are valid reasons
for both recruitment and internal promotion and that organisations
must do both successfully and master the challenges associated
with each in order to thrive:
“All ways to get in touch with potential high value managers must
be explored. So internal ways are still valuable to consider but
compared to many other external sources.”
“Always promote internally as it carries less risk / more success
unless the business landscape has changed and requires a new
strategy and therefore new people.”
“Companies need a regular injection of outstanding talent from the
outside to keep fresh and to perpetually challenge themselves and
their ‘eternal truths’.”
“Both [recruitment and retention] are investigated. Mostly for high
positions is it better incorporating someone from outside, bringing
other practices and know-how.”
“As far as I am concerned, the question of internal versus external
remains. The challenge will always be if internal: how to gain the
respect of the people you manage.”
“A company needs to do both. To use a sporting analogy, most
successful teams have a youth system and a transfer policy.“
“During a crisis I consider it important to engage external
recruitment of the highest experience (older candidates). Internal
promotion doesn't give new ideas.”
“[I am] Erring more towards internal promotion, which I believe is a
policy most companies should follow. It also demonstrates to
others that performance is recognised.”
“[You] Need a balance depending on the organisation. We are
growing globally at 40% year on year. Promoting from within was
great when we were a young UK business, but we need more global
experience from new senior managers, which cannot always be
developed internally, until we become more established globally.”
“[I’m] Not sure it is changing. Our policy is always to promote from
within if the talent exists internally – if not, we look outside.”
“This depends on the evolutionary stage of an organisation. If the
talent does not exist internally to handle the task, the option is to
look outside; but this may mean the organisation has failed to
anticipate the change and looking for new talent outside may only
be a band-aid treatment. “
“You have to measure the potential of internal and faithful people,
giving them chances to develop their skills. But it isn't less
important to hire new people with wide experience outside the
company in order to balance continuity with ‘fresh air’.”
A recurrent theme was the notion that internal promotion is only
possible when the organisation has strong people development
plans in place, and that such programmes have too often fallen
under the chopping block in cost reduction schemes – thus
rendering the internal talent pool less suitable for promotion:
“As companies are leaner, there is less choice internally and the
development of staff is less.”
“Companies in this period are folded upon themselves.
Companies recruit external staff only for contingency reasons.
Companies are not investing in talent at this time.”
“Companies who skimp on internal training and development need
to resort to the external recruitment of senior people at an overall
loss of efficiency and profitability.”
“Lack of training, mentoring and succession planning has
destroyed the promotional ladder. The economic climate dictates
cutbacks and all non-core activities suffer.”
“External recruitment is a cost but also an enlarged source of value.
Internal recruitment is a value if a company has a good school of
management (ramping processes, succession plans) otherwise is
a way to pump up resources not yet fit and ready for these roles.”
“[It] Depends on the organisation’s capability: some organisations
have talent development capabilities, some simply go to market
when the need arises.”
“Due to the recession, fewer internal staff with the appropriate skills
are available. The best have gone, as they were too expensive and
were not replaced like-for-like (reduced salary and quality).”
“Succession planning is becoming more difficult as all levels of
talent are moving. External recruitment is good for cultural
innovation and enhancement.”
12
Recruitment Methods
13
Survey respondents were asked to rank the effectiveness of various
tools and methods they used to recruit senior managers and
executives into their companies or organisations (or to indicate that
they don’t use them).
All of these tools and methods are broadly used by responding
companies, with at least 77% of companies reporting using them.
Employee referrals are used by virtually all companies, with only 7% of
respondents reporting non-usage of employee referrals to generate
candidates for internal roles.
In terms of effectiveness, respondents rank executive search or
recruitment firms or agencies and employee referrals the most effective
way to recruit senior managers and executives. More than half of
respondents reported that executive search or recruitment firms (either
“retained” or “contingent”) are “Effective” or “Highly Effective” at
delivering successful hires.
By contrast, respondents were far more likely to rate job boards, job
postings on the company’s own website, print advertising, conferences
or online CV databases as “Not Effective” or “Not Very Effective”.
Not Effective
Effectiveness ratings of recruitment tools and methods
13%
14%
10%
4%
6%
4%
14%
16%
9%
Not Very Effective
31%
34%
27%
14%
21%
23%
31%
33%
32%
Effective
29%
27%
28%
40%
37%
38%
25%
21%
24%
Highly Effective
7%
8%
11%
27%
15%
26%
6%
6%
8%
Do Not Use
22%
17%
23%
13%
18%
7%
22%
22%
25%
Job board advertising
Job posting on own company's website
Social media (LinkedIn, Twitter,Facebook, Xing)
Retained executive recruitmentor search firm
Contingent (non-retained)executive recruitment firm
Employee referrals
Print advertising in newspapersor trade magazines
Attending conferences, eventsand trade shows
Online CV databases (other thanLinkedIn or other social media)
Effective / Highly Effective
Not / Not VeryEffective
Job board advertising
Job posting on own company’s website
Social media
Retained executive recruitment or search firm
Contingent (non-retained) executive recruitment firm
Employee referrals
Print advertising
Attending conferences, events and trade shows
Online CV databases
Recruitment methods and tools rated effective or not
35%
34%
38%
67%
52%
63%
31%
27%
33%
43%
48%
37%
18%
26%
28%
45%
49%
41%
Asked which method or source they found to be the most effective of all at providing qualified
candidates who go on to be interviewed and hired, respondents reported that employee referrals
and retained executive search firms emerge as the most effective. The top three recruitment
resources or methods were recruitment firms of any type – retained, with 34% of respondents
ranking them most effective; and contingent, with 9% ranking them most effective – and employee
referrals, which 25% rate the most effective.
Asked which they found to be the least effective, respondents’ answers were more democratically
distributed across all the options, with each option garnering between 4% and 17% of the negative
ratings. However, even in these ratings we see the continued reliance on and relatively positive
experience of using recruitment service providers, which barely figure in this “least effective”
category – only 4% of respondents rated contingent recruitment firms the least effective way to find
good candidates, and only 7% rated retained firms the least effective.
These findings show that print advertising certainly seems to have had its day, as well as using
face-to-face events to identify candidates, as their effective ratings skew towards the “not
effective” end of the spectrum.
The broad distribution of effectiveness ratings backs up the fact that most companies continue to
use a range of recruitment tools and methods to identify senior managers and executives to hire.
There is no “magic bullet”, although compared to “do it yourself” resources like job board
advertising, the use of a company’s own website to advertise jobs, social media and recruitment
service providers are rated more highly.
14
Recruitment tools and methods rated “most effective”
7%
Job boardadvertising
5%
Job Postingon your owncompany'sweb site
7%
Social Media(LinkedIn,Twitter,
Facebook,Xing)
34%
RetainedExecutiveRecruitmentor Search
firm
9%
Contingent(non-
Retained)ExecutiveRecruitmentor Search
firm
25%
EmployeeReferrals
3%
PrintAdvertising
innewspapersor trade
magazines
3%
Attendingconferences,events andtrade shows
4%
Online CVdatabases(other thanLinkedIn orother social)
Recruitment tools and methods rated “least effective”
14%
Job boardadvertising
12%
Job Postingon your owncompany'sweb site
11%
Social Media(LinkedIn,Twitter,
Facebook,Xing)
7%
RetainedExecutiveRecruitmentor Search
firm
4%
Contingent(non-
Retained)ExecutiveRecruitmentor Search
firm
10%
EmployeeReferrals
16%
PrintAdvertising
innewspapersor trade
magazines
17%
Attendingconferences,events andtrade shows
9%
Online CVdatabases(other thanLinkedIn orother social)
15
There were variations in viewpoints, depending on the respondent’s role in the organisation, withthe opinions of Human Resources professionals being more definitive (concentrated) in their likeor dislike of particular recruitment resources and tools. Compared to their colleagues in line orfunctional management, HR managers have more faith in the effectiveness of social media andretained executive recruitment firms in providing qualified candidates who go on to be interviewedand hired. HR managers are less likely to believe contingent recruitment firms and employeereferrals to be the most effective. Non-executive directors have the most positive view of socialmedia of all their colleagues, perhaps because of the importance of such channels in building thetype of portfolio career they are, by definition, engaged in.
By company size, respondents’ answers conformed very closely to the overall average, with just a
few exceptions. Smaller companies are somewhat more likely than larger companies to believe
employee referrals are the most effective tool or resource. Also, smaller companies are less likely
to view retained executive recruitment firms as the most effective.
HR
Recruitment tool or method rated “most effective”, by role of respondent
9%
6%
13%
39%
3%
16%
6%
3%
3%
Line Manager
6%
4%
7%
36%
8%
29%
3%
3%
2%
Functional Mgr
6%
5%
6%
35%
9%
24%
3%
3%
6%
Non-Exec Director
2%
7%
20%
29%
7%
20%
5%
0%
7%
Average
7%
5%
7%
34%
9%
25%
3%
3%
4%
Job board advertising
Job posting on own company's website
Social media (LinkedIn, Twitter,Facebook, Xing)
Retained executive recruitmentor search firm
Contingent (non-retained)executive recruitment firm
Employee referrals
Print advertising in newspapersor trade magazines
Attending conferences, eventsand trade shows
Online CV databases (other thanLinkedIn or other social media)
“Non-executive directors have the most positive view ofsocial media of all their colleagues, perhaps because ofthe importance of such channels in building the type ofportfolio career they are, by definition, engaged in.”
16
Looking at the results by country, there were some interesting variations. Retained recruitment
providers were more likely to be viewed as the most effective way to identify good candidates in
the Benelux countries than in other countries. Employee referrals are regarded as less effective in
Belgium and Germany, and more effective in the UK, compared to other countries. Print
advertising is least well regarded in Belgium, France and The Netherlands. In Germany, the
Republic of Ireland and The Netherlands, respondents were more likely to view social media as the
most effective recruitment tool or resource.
Recruitment method rated “most effective”, by country
6%
11%
7%
44%
5%
16%
2%
2%
6%
Job board advertising
Job posting on own company's website
Social media (LinkedIn, Twitter,Facebook, Xing)
Retained executive recruitmentor search firm
Contingent (non-retained)executive recruitment firm
Employee referrals
Print advertising in newspapersor trade magazines
Attending conferences, eventsand trade shows
Online CV databases (other thanLinkedIn or other social media)
“Retained recruitment providers weremore likely to be viewed as the mosteffective way to identify goodcandidates in the Benelux countriesthan in other countries.”
Belgium &Luxembourg
9%
5%
7%
37%
7%
26%
0%
3%
2%
France
8%
4%
13%
30%
12%
19%
3%
4%
4%
Germany
3%
6%
11%
33%
17%
28%
3%
0%
0%
Republic ofIreland
8%
6%
8%
31%
7%
25%
3%
2%
6%
Italy
0%
6%
11%
46%
9%
20%
2%
6%
0%
Netherlands
7%
3%
5%
32%
10%
30%
5%
3%
3%
UK
7%
5%
7%
34%
9%
25%
3%
3%
4%
Average
“Many resp
onde
nts co
mmented on
the de
sirability of the recruitm
ent
compa
ny perform
ing the filtering to redu
ce a broad
poo
l of app
licants
to the be
st handful, b
ut obs
erved that it can be difficult to
communicate finer points of fit for a ro
le that m
akes this possible.”
Philosophy of Search: Broad or Narrow?
17
Asked which of the following statements they most agreed with, “In sourcing management and
executive talent, it is most important to consider the broadest audience of potential candidates, to
identify people within that who are most likely to possess all the required attributes,” or “In sourcing
management and executive talent, it is most important to engage only within a small universe of
potential candidates already well regarded by our company or our recruitment partner,” respondents
were evenly mixed in their answers, with 52% supporting a broad approach.
Examining respondents’ comments in response to this question illuminates some of the underlying issues
in greater detail. Many respondents commented on the desirability of the recruitment company performing
the filtering to reduce a broad pool of applicants to the best handful, but observed that it can be difficult to
communicate the finer points of fit for a role that makes this possible. Some commented on the fact that
casting a wide net produces a screening burden, but that this is worth it to uncover the right candidate.
Others pointed to the narrowness of their specific industry making a focused approach quite effective.
“For an executive hire, many people will be known, but it would be a folly to assume only those ‘known’
represent the potential pool and I would expect active and original research which would complement
our organisational knowledge.”
“The problem is getting recruiting companies to understand the filters.”
“We operate within a specific sector and network widely, so we know who we would wish to recruit from
within our network.”
“Recruitment partners tend not to fully understand the brief and to employ people who are sales driven,
which is not in the best interest of either the company or candidate, when they do not fully understand
what they are looking at in a CV.”
“The search for talent should initially be broad, narrowing down to key prospects and eventually
selecting talent with proven records / achievements and the capacity to play within company teams and
their dynamics.”
“Quality is more important than quantity. It's important for the recruitment agent to find a way to provide
value that the client cannot get by ‘going direct’ or DIY through e.g. social media – for example,
knowledge of the candidates, skills required, state of the industry etc.”
“Looking at the broadest audience is usually time consuming and expensive. There is also the element
of competition to hire the best candidates. It is better to target a pool of known performers with good
cultural fit with our organisation.”
“There is a trade-off between who is known within the small pool and considered to be safe, as opposed
to the risks associated with unknown candidates – who may bring more value, but who also may not be
able to succeed as well as experience or CV suggests.”
“It gives added value to also consider a broader audience, since these candidates can provide another
and more unbiased view / approach.”
“When looking for unique, non-cv related skills we need to see / view a lot of candidates. When looking
for more widely-held skills, you can employ database searches and narrow the list of candidates.”
“Recruitment firms tend to narrow down candidates too much and are willing to reduce their effort by reducing
choice and options. The focus is too much on skills and past experience, which eliminates strong candidates
from other industries or functions. The focus should be rather on fit, potential and honest ambition.”
Making a move to a new role is a decision no manager or executive
undertakes lightly. Many factors interact to make an opportunity
appealing – issues ranging from financial compensation, flexible
working, lifestyle features such as length of commute, as well as the
fundamental attributes of the role in terms of the interest, challenge and
development potential it offers.
We asked our survey respondents to rank certain factors in terms of the
influence in a prospective employee accepting a job offer in their
company or organisation, where 1 = the most influential factor,
and 7 = not influential at all.
Generally our survey respondents felt that the issues most tightly
connected with the job itself provided the dominant motivations for
making a move: its challenge, the opportunity to learn and grow, and
how much the prospective employee felt he or she would enjoy the role.
Remuneration is the second strongest perceived motivator, with other
attributes of the job like flexible working featuring less strongly in
candidates’ deliberations.
18
Motivation of New Employees
Average ranking of factors affecting acceptance of new job offer
2.6Level of remuneration
Challenge of the role
Enjoyment of the role
Opportunity to learn / grow
Flexible working practicessuch as work from home,
flexible / reduced hours, etc.
Work / life balance
Commute / geography
1 2 3 4 5 6 7
Scale: 1 = most influential, 7 = not influential at all
2.4
3.2
2.9
4.3
4.0
4.3
“There are a lot of p
eople looking for job
s. Advertising
on Mon
ster simply results in hundred
s of CVs com
ing
throug
h and recruiters calling us. It's better to focus on
the be
st ‘p
re-qualifying’ ro
utes to candida
tes.”
Experience and Viewpoint on Job Boards
Job boards – websites created specifically for the advertising of jobs – have been a prominent featureof the recruitment landscape since the mid 1990s. Newspapers were among the first organisations tolaunch job boards, taking the classified job advertising they’d always sold and providing it in the onlinespace, followed by sites like Monster, Hotjobs and others – dedicated online businesses not backed by“bricks and mortar” companies.
Anyone who worked in recruitment will remember the anguish over the concept of “disintermediation”:the idea that efficient, data-driven online sites would enable employers and candidates to connect witheach other directly, and thus make recruitment service providers obsolete.
What happened instead is that the ease with which employers and candidates could connect directly,actually made recruitment service providers more relevant. Despite rich databases of candidateregistration data backing up the job boards, they still produce, in most cases, a surplus of imperfectcandidates. In reality employers don’t want to see a long list of candidates for a role, they want to see asmall number of highly suitable candidates.
Far from being made obsolete, members of the recruitment industry adopted job boards as their ownand began to use them to provide a better and more effective service to clients. Recruiters becameexpert at writing online adverts to attract the right sorts of candidates and used this to remove thescreening and filtering burden – which still requires human eyes and assessment – from theemployers. Job adverts run by recruitment companies therefore dominate the online space in the sameway that recruiter ads used to dominate the broadsheet newspapers.
The obsolescence wrought by the emergence of job boards has not been of the recruitment industry,but rather of the print medium as a recruitment advertising channel. This is a trend mirrored elsewhere,as advertising of all types has moved from print publications to online. Online advertising is highlytrackable via click-through rates, cost per visit, cost per CV and associated measures, and this hasenabled advertisers to measure their spend against the return they get. This focus on return hasprompted a collapse in pricing, as advertising has moved from print, where measurement is moredifficult, to online, where precise measurement is possible and the willingness to pay can be matchedto the return. Recruitment advertising at one international newspaper used to be a business worth tensof millions of pounds annually; today, recruitment advertising is largely online and generates less than£10 million per year.
Twenty years on, how do hiring managers view job boards? We asked our survey participants, withrespect to their experience of job board adverts, which three statements they most strongly agree with.
Less than 20% of respondents had positive things to say about job boards, and upwards of 40% ofrespondents registered negative comments.
19
Most job board applicants are a fit for the role advertised,and we proceed to interview them
Job boards deliver value for money
Job boards produce too many candidates
Job boards produce so many unqualified applicants as toimpose a screening burden on company staff
Most job board applicants are not a fit for the role advertised
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Attitudes and views on job boards – percentage of respondents agreeing
15%
20%
45%
42%
39%
20
Respondents’ views of job boards varied by country, but did not deviate from the universal view, which
is predominantly negative. Compared to the European average, job boards are less well-regarded in
Ireland, The Netherlands and the UK, whereas in Germany, France and Italy they enjoy a more
favourable reputation.
Attitude and views of job boards, by country
18%
20%
49%
42%
40%
18%
22%
43%
34%
32%
24%
29%
47%
40%
42%
11%
16%
42%
42%
42%
19%
21%
39%
37%
36%
5%
15%
35%
36%
33%
8%
17%
51%
54%
45%
15%
20%
45%
42%
39%
Most job board applicants area fit for the role advertised, andwe proceed to interview them
Job boards delivervalue for money
Job boards produce too many candidates
Job boards produce so manyunqualified applicants as to
impose a screening burden oncompany staff
Most job board applicants arenot a fit for the role advertised
Belgium &Luxembourg France Germany
Republic ofIreland Italy Netherlands UK Average
“Compared to the European average, jobboards are less well-regarded in Ireland,The Netherlands and the UK...”
Viewpoint on and Experience of Executive Recruitment Agencies
The recruitment industry, including executive recruitment, remains highly fragmented. In the UK alone,
there are thousands of executive recruitment companies, ranging from “one man bands” of
independent recruiters and small boutiques up to major listed corporations employing thousands of
recruitment consultants globally. As in any service industry, the nature and attributes of services
provided vary by firm – according to its declared business process – and the individual within the firm
providing the service.
At a meta level, pricing and service fall into two main categories, retained and contingent service, with
each having its pros and cons. Retained executive and management recruiters typically work on an
exclusive basis, levy a fee to commence a search, occasionally charge fees at particular milestones
along the way, and finally charge a completion fee when the new employee signs contracts or starts
work. Contingent recruitment firms will work in competition with other agencies and don’t tend to
charge in advance, earning their fee only as and when the chosen candidate starts work. Too much
competition in the form of multiple agencies working on one role can create confusion in the talent
marketplace, with candidates not knowing which agency to apply through, and with an over-advertised
role looking tarnished (and perhaps a bit desperate). Commitment and competition are both desirable,
yet are opposing dynamics in the recruitment process. Knowing this, some employers make use of
both types of agencies on a role-by-role basis.
We asked our survey respondents which factors were important (and most important) to them when
choosing a recruitment service provider.
Asked to pick any factor that was important to them, respondents’ answers indicated that speed of
service, the track record of the recruitment provider in the role’s function or industry, and a personal
relationship with the recruiter were important to the largest proportion of respondents. Pricing and
associated terms and conditions were also important factors.
21
Speed of service
Price
Proven track record in function / industry
Personal relationship: I know and trust the individualrecruiter who will be doing the work
Corporate reputation: I know and trust the recruitment firm
Size of talent pool
Guarantee (commitment to restart search at no further cost if the employee leaves early in his / her tenure)
My company has a Preferred Supplier List (PSL) whichdetermines the suppliers I can use for executive recruitment
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Factors important in selection of recruitment provider – percentage of respondents mentioning
51%
47%
56%
58%
38%
24%
42%
15%
Asked to indicate the single most important factor, the survey participants’ responses prioritised a
proven track record and personal relationship whereas speed of service, price and guarantee fell away
as secondary, tertiary or lower priorities.
The question about recruitment Preferred Supplier Lists (PSLs) is interesting, with 15% of respondents
indicating that their company operates a PSL, but only 4% reporting that it completely restricts their
choice of which recruitment provider to work with.
More than half of respondents whose companies operate PSLs report them as ineffective in delivering
quality candidates and reducing cost. In the current economic environment, more respondents expect
PSLs to strengthen than weaken in the future. Asked whether they love or hate their PSL, respondents
reporting that they hate it outnumbered respondents who like and support their PSL.
22
Effective at delivering quality candidates
Effective at reducing cost
Expect to use PSL suppliers more, or more exclusively, in the future
Expect to use PSL suppliers less (have more leeway to usenon-PSL suppliers) in the future
I like having a recruitment PSL to work with
I hate having to work with a recruitment PSL
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Views on recruitment Preferred Supplier Lists (PSLs)
44%
32%
14%
10%
16%
22%
Speed of service
Price
Proven track record in function / industry
Personal relationship: I know and trust the individualrecruiter who will be doing the work
Corporate reputation: I know and trust the recruitment firm
Size of talent pool
Guarantee (commitment to restart search at no further cost if the employee leaves early in his / her tenure)
My company has a Preferred Supplier List (PSL) whichdetermines the suppliers I can use for executive recruitment
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Factors important in selection of recruitment provider – percentage of respondents mentioning as “most important” factor
9%
6%
28%
30%
9%
6%
7%
4%
23
The lack of an overwhelming view about PSLs in response to any of these statements, together with
respondents comments about PSLs seems to indicate that, with respect to their relevance and
effectiveness, it very much depends on whether the companies on the PSL can understand the hiring
manager’s requirements and preferences, and use that understanding to screen and vet candidates to
produce a quality short list of relevant candidates.
“A PSL is a good idea but it can also be limiting.”
“ A PSL doesn’t allow more than one recruitment firm and one size does not fit all.”
“Not necessarily effective at delivering best quality candidates if the price is too low.”
“They have a tendency to become complacent and focus on the individual within the company with
whom they have a relationship, rather than understanding the recruiting manager's requirements.”
“While the majority of faith is placed in the PSL, it is always good to have the flexibility to use non-PSL
suppliers, if necessary.”
“Working with a PSL of proven competency ultimately reduces costs and enhances speed of delivery.”
“A personal relationship – know
ing and trusting the individ
ual
recruiter w
ho will be
doing
the work – was the sing
le m
ost
impo
rtant determinant in choo
sing
a recruitment provid
er...”
24
Deeper into the process of engaging a recruiter, the importance of relationship emerges again, with an
interview of the recruiter and references from his or her clients emerging as more important than work
product (sample CVs), pitches or in-market testing (putting multiple recruiters to work on the same role).
Do a web search via Google or another search engine
Ask a friend or colleague for a recommendation
Search otherwise online (e.g. LinkedIn)
Trade or professional body (e.g. REC, CIPD)
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
How to find a recruitment provider
14%
52%
15%
13%
Ask for some example CVsInterview several suppliers and choose the one who is most
knowledgeable and seems likely to be the most effectiveAsk multiple firms to pitch for the work
in a formal presentation
Take references
Put multiple agencies to work on the role and see who delivers
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
How to qualify a recruitment provider
9%
31%
14%
31%
12%
“Deeper into the process ofengaging a recruiter, theimportance of relationshipemerges again...”
Selection of Recruitment Service Provider
We were interested to understand how hiring managers (who are not constrained by a PSL) find a
recruitment provider to help them. Personal recommendations are very important, as might be
expected in any service industry. A personal relationship – knowing and trusting the individual recruiter
who will be doing the work – was the single most important determinant in choosing a recruitment
provider, outranking the track record of the firm, pricing, speed of service and other important
attributes, whether the respondent was asked to indicate any factors that had importance, or only the
one most important factor. Lacking an existing personal relationship with a recruiter, most respondents
would seek to gather the next best thing: the assurance from a trusted friend or colleague who did
have a positive relationship with a recruiter that the particular recruiter would do good work.
Social Media
25
100%
80%
60%
40%
20%
0% LinkedIn Facebook Viadeo
Which of the following social networking sites do you use?
Percentage of Respondents Using
90%
36%
Xing Twitter
20%16%
Experteer
key
24%
36%
2012
100%
80%
60%
40%
20%
0%LinkedIn Facebook Viadeo
Which of the following social networking sites do you use IN YOUR PROFESSIONAL LIFE?
Percentage of Respondents Using
87%
12%
Xing Twitter
16%
7%
Experteer
key
18%26%
2012
Following the entry of job boards in the 1990s, the landscape of onlinetools to support executive recruitment underwent a majortransformation again a decade later, with the emergence of social andprofessional networking sites that not only contained candidateprofiles and enabled transactions (like applying for a job), but alsomodelled and supported the relationships between people. Early siteswith a more purely social slant – like SixDegrees.com in 1997; FriendsReunited, which debuted in 2000; and Friendster in 2002 – werefollowed by LinkedIn in 2002 and Facebook in 2004, which becamethe largest social networking site in the world. LinkedIn remains thedominant professional networking site globally, an indispensable toolfor managers and executives seeking their next role, and, increasingly,for the employers who hire them.
By 2012 LinkedIn has become virtually ubiquitous among Europeansenior managers’ and executives’ tools for professional networking,with 90% of respondents using LinkedIn. Facebook and Experteer, a
job board with strong social features, were the next most popular sites,with 36% of respondents indicating they use each of these sites.However, among senior managers and executives, Facebook remainsmuch more a social tool for family and friends, and is seen far less asa professional networking medium. Only 12% report using Facebookin their professional lives. All social networking sites, even the mostcareer oriented, showed a drop-off between any usage andprofessional usage, but the largest drop-off rate is with Facebook,indicating that fewer users see a professional application for itscapabilities and features. Doubts remain in many respondents’ mindsabout whether all the social platforms are effective for professionalnetworking. As one respondent commented, “I am still not convincedthat social media is a good environment for important professionalbusiness, especially where subject matter expertise is relevant. Theproblem is that once topics are opened up for discussion, it is difficultto eliminate noise.”
26
When respondents were asked to rate the usefulness of the various social networking sites, LinkedIn once
again garnered the highest ratings for “usefulness.” Users were far more likely to rate Facebook and Twitter as
"useless". For the other sites – Xing, Viadeo and Experteer – which maintain a strong careers orientation –
roughly the same percentage of professional users rate the sites “useful”.
However, a much higher proportion of users rate them “useless” in the professional context, and fewer rate
them “highly valuable” than LinkedIn.
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0% LinkedIn Facebook Xing Twitter
Please rate the following sites in terms of their usefulness in your professionallife/job search
Percentage of Respondents
2012 Highly valuable Useful Useless
“By 2012 LinkedIn has be
come virtually ubiqu
itous amon
g senior
manag
ers and executives’ too
ls for p
rofessional networking
, with
90% of respo
ndents using
LinkedIn ...”
Viadeo Experteer
27
More detailed survey questions sought to assess how useful social
networking sites are to the recruitment process itself. Two thirds of
respondents indicated that they had searched for a job using social
networking sites. By early 2012, 20% report having found a job via
social networking.
Employers’ efforts and success with social media has increased
even more strongly, with 36% of hiring managers reporting trying
social networking sites when they needed to recruit and 18%
reporting actually having hired someone that way. A successful hire
or engagement resulting from social media is equally likely for the
job-seeker as the person seeking to hire them.
The yield of effort to hire is higher for the employers, but this is to be
expected across all recruitment methods, not just social media.
Generally, there are multiple candidates trying for each job, and
thus more candidates than jobs. More research is required to
understand how the 3:1 ratio of attempted job-searching to roles
found via social media compares to other channels and activities.
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%Have you ever
searched for a job on asocial networking site?
Have you ever found ajob via a socialnetworking site?
Have you ever tried torecruit via a socialnetworking site?
Have you ever hiredsomeone you haverecruited via a socialnetworking site?
Usage and Success of Social Networking Sites in Job Searching and Hiring
Percentage of Respondents
No 34%
Yes 66%
No 80%
No 64%
No 82%
Yes 20% Yes 36%
“A successful hireor engagementresulting fromsocial media isnow equally likelyfor the job-seekeras the personseeking to hirethem.”
Yes 18%
For more detailed data and analysis of social and professional
networking sites in executive recruitment, including usage and
success rates by company size, industry and country, request and
download Executives Online’s report “The Social Executive”,
available free from any Executives Online website.
Any business process must lend itself to measurement, and
recruitment is no exception. Many metrics can be derived from
the recruitment process, at any stage: number of applications,
number of qualified candidates, candidate to interview ratio,
interview to hire ratio, employee tenure, cost per hire, quality
of employee.
Most companies do have systems in place to measure
recruitment. Only 13% of respondents reported having no formal
measurement in place.
As to what’s important to measure, reassuringly, the senior
managers and executives we surveyed for this report were not
seduced by the statistics. The largest proportion of respondents
rated the quality of candidate hired – that is, the fact that the
person performs at or above expectations in the role – as an
important measure. Half of respondents felt quality of
applicants was important. Longevity, speed of recruitment and
cost per hire also garnered many votes, compared to the
metrics geared at quantity (of applicants, interviews).
28
Measuring Recruitment
“The largest proportionof respondents ratedthe quality ofcandidate hired – that is, the fact that theperson performs at orabove expectations inthe role – as animportant measure. ”
Quality of candidate hired
Longevity of candidate hired
Quality of applicants
Number of applicants
Number of interviews
Speed of recruitment
Cost per hire
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
How to measure recruitment success – percentage of candidates mentioning
74%
37%
50%
7%
9%
30%
25%
KeyExact wording of these questions were:Quality of candidate hired – person hired performs at or above expectations in the roleLongevity of candidate hired – person hired is still in post after 12 months or other timescaleQuality of candidates applyingNumber of applicantsNumber of interviewsSpeed of recruitment: time from brief / initiation of process to hireCost per hire
29
Quality of candidate hired
Longevity of candidate hired
Quality of applicants
Number of applicants
Number of interviews
Speed of recruitment
Cost per hire
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
How to measure recruitment success – percentage of candidates mentioning as single most important metric
0%
14%
10%
64%
1%
3%
2%
When we asked them to name the single most important measure,
quality of employee stands out at an even greater margin compared
to the other factors. For 64% of respondents, this remains the single
most important measure, compared to the next most important,
quality of applicants, at only 14% of respondents.
“The single most important measure,quality of employee stands out at aneven greater margin compared tothe other factors.”
30
Outlook on Future Executive / Management Hires
Taken as a whole, executive recruitment tends to follow the business cycle, with more
management and executive hires occurring during times of economic buoyancy and expansion,
and fewer occurring during periods of stagnation or recession. There are exceptions; for
example, in industries that run counter to the prevailing business cycle, or in the public sector.
The global financial crisis and resultant recessionary periods have wreaked havoc on
recruitment and the recruitment industry.
Not all the effects are as simple as companies making fewer hires. A recessionary climate also
causes the talent pool of managers and executives (who might take a new role) to behave
differently. Employees who are secure in a permanent role are less inclined to “jump ship” in the
hope or expectation of a better opportunity. Managers and executives who are out of work are
very active in the market, networking and applying for roles. What’s more, companies that are
still hiring are observed to follow different process when hiring, adding more stages of
interviews and additional qualifying steps, in an effort to reduce the risk of a bad hire, which
would be even more detrimental in a difficult climate than in expansion. For the executive
recruiter and for employers doing recruitment directly, there can actually be more work
associated with completing fewer hires: additional effort screening, shepherding candidates
through a more lengthy interview and qualification process, and re-starting a search when a
person who is offered the job turns it down to stay where they are.
We saw this survey as an opportunity to “take the pulse” of a sample of senior managers and
executives across Europe, to understand their immediate plans for recruitment of managers
and executives, how this compares to five years ago, and what they believe the future will hold.
Our first question in this vein asked respondents how they expected their hiring of senior
managers and executives to change in the next five years.
For a majority of respondents (73%) the picture is either steady or slightly better than today,
indicating a sense of cautious optimism about the future. The percentage of respondents who
anticipate major changes – positive or negative – stands in the single digits.
“A recessionary clim
ate also causes
the talent poo
l of m
anagers and
executive
s (who might take a new
role) to be
have differently. ”
No change from today
Hiring somewhat more than today (up to +25% more)
Hiring somewhat less than today (-25% or less)
Hiring many more than today (more than 25% more)
Hiring many fewer than today (more than a 25% drop-off)
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
How will your executive recruitment change in next five years?
35%
38%
15%
6%
5%
By industry, we see that the more optimistic sectors include Financial Services and Healthcare / Medical, which are more likely to reporthiring somewhat more than in the past. By contrast, the retail sector had more respondents than the average or other industries whoreported expecting to hire less.
31
No change
How recruitment is expected to change, by industry
38%
38%
29%
29%
38%
33%
48%
25%
42%
33%
35%
Hiring somewhat more
39%
33%
51%
54%
37%
40%
37%
38%
42%
41%
38%
Hiring somewhat less
12%
19%
14%
13%
15%
15%
7%
25%
10%
14%
15%
Hiring many more
7%
7%
3%
4%
4%
9%
7%
7%
6%
8%
6%
Hiring many fewer
4%
3%
3%
0%
6%
3%
1%
5%
0%
4%
5%
Business Services
Building / Construction
Financial Services / Banking
Healthcare / Medical
Industrial / Manufacturing
Media / Marketing /Entertainment / Advertising
Professional Services (Law,Accountancy)
Retail / Distribution
IT / Telecoms / Technology
Transport / Logistics
Average
No change fromtoday
How recruitment is expected to change, by country
31%
39%
32%
31%
36%
39%
40%
35%
Hiring somewhatmore than today
(up to +25% more)
41%
28%
47%
55%
37%
35%
36%
38%
Hiring somewhatless than today (-25% or less)
16%
20%
10%
11%
18%
15%
12%
15%
Hiring many morethan today (morethan 25% more)
7%
6%
9%
0%
3%
11%
6%
6%
Hiring many fewerthan today (more
than a 25% drop-off)
5%
7%
2%
3%
6%
0%
6%
5%
Belgium and Luxembourg
France
Germany
Republic of Ireland
Italy
The Netherlands
UK
Average
By country, we see that hiring managers in Germany and the Republic of Ireland are more likely than in other countries (or the average) toexpect stronger future hiring. In France and Italy, respondents were more likely to expect future hiring at levels somewhat less than today.
32
The changing and difficult economic climate has required companies to adapt and change in order to
survive. Whether “recession management” skills can be explicitly identified and recruited for was not
universally agreed upon by the respondents to this survey. Only one-third of respondents felt that the
financial crisis and resultant recession had caused them to demand skills that are specifically aligned
to managing in recession.
Contextual Factors
No67%
Yes33%
Searching for recession-specific skills in new hires
Asked about what recession-specific skills, most respondents commented that ability to understand
and implement cost control was important and that more flexibility was required to manage in
recession under leaner organisational structures:
“Multi-tasking is now an essential part of office life and there is no room for inflexible attitudes.”
“I recruited an experienced Financial Controller to better manage the business mix to mitigate lower
unit revenues and higher unit costs.”
“The focus has changed from top line jobs – sales, marketing – to bottom line cost control jobs such
as operations and supply chain, and controlling – finance and admin – functions.”
“Ability to deliver growth in a competitive marketplace and a strong understanding of cost control.”
“Whether ‘recession managem
ent’ skills can be
explicitly identified and recruited for w
as not universally
agreed
upo
n by the responde
nts to this survey. ”
A War for Talent?
33
No56%
Yes44%
War for talent exists
The concept of a “War for Talent” was first posited by Steven Hankin
of McKinsey & Company in 1997 and refers to an increasingly
competitive landscape for recruiting and retaining talented
employees. In a subsequent book published by Harvard Business
Press, the authors suggest a mindset that emphasises the importance
of talent to the success of organisations.
Demographic trends underpin the competitiveness of the market for
talent, particularly in the United States and Europe, as there are fewer
post baby-boom workers to replace baby-boomer retirement. The
evolution of work from a production orientation to a knowledge
orientation has intensified this and has made workforces inherently
less flexible, as depth of knowledge is comparatively difficult to
achieve and replace.
Respondents to our survey were mixed on the question of whether a
war for talent persists today.
“The evolution of work from a produ
ction orientation to a
know
ledg
e orientation has intensifie
d this and
has made
workforces inherently less flexible, as de
pth of knowledg
eis com
paratively difficult to achieve and
replace. “
34
Their comments posed insightful questions on the nature of talent itself: whether it’s an absolute or
varies according to what the organisation or role requires:
“It is never easy to find and keep good talent, but the most relevant problem is not to fight a war –
many companies refrain from hiring managers during a recession phase – but to find out the profile
with the right characteristics.”
“You have to adapt the concept to the company’s size, culture and strategic fit.”
“It is dependent on what the total scope of the job is, especially relevant when dealing with Business
Services and the talent has broad knowledge of operating in both climates.”
“With shrinking organisations in Europe and US there is plenty of talent on offer in these markets. Such
excess often cannot be absorbed by growing economies because of cultural gaps and, in many cases,
unavailability to relocate long distance for professionals of 40 years of age and older.”
Whether recession intensifies or alleviates the competition for talent was also the subject of some debate:
“I think that in economic downturns, the fight for real talent is greater.”
“Maybe the drop in ‘talent’ leaving organisations due to retirement is somewhat softened by the
(structural) economic downturn, but it continues to be the people that make the difference!”
“People in leadership really have to lead now. When times are good, everyone looks good; it's only in
times like this when focused, inspirational, competent leaders can keep their heads and drive the
business forward.”
“[The war for talent applies] more than ever. Due to the economic downturn, baby boomers are
massively leaving the market. When the economy picks up there will be a huge demand.”
“Competition is tougher in crisis periods. Only the best succeed in a decreasing economy.”
Still others dismissed a war for talent as not relevant, now or ever:
“There is a lot of talent available. The rat race is between egos is in my opinion, not the real talent pool.”
“It's not a war, it's progress and natural evolution.”
“At least as far as I can see, with the current economic crisis, the emphasis is off ‘talent’ and more on
keeping good elements who do not cost too much and are super-performing.”
“[The war for talent is ] too theoretical. Translation (on the floor) of talent into hands-on objectives is
always difficult.”
“[I] Never did consider business as a war – that creates a certain mentality we do not agree with.”
Conclusion
In the six years since our last report on permanent executive recruitment, the landscape has certainly
changed, with numerous new tools and methods in use and the financial and economic crisis casting
its long shadow over employers’ plans. Print advertising is in long-term decline and social media on
the rise. The cost and measurement of recruitment is now more on people’s minds.
And yet, much has stayed the same: The fundamental challenges of identifying and engaging people –
leaders – to help drive an organisation’s success are the same as ever. Even the nuances and priorities
within the process of matching person to profile are strikingly similar: Finding people with the right
cultural fit and the speed of recruiting those people are as important now as then. Across the diverse
cultures and economies of greater Europe, there are differences in attitudes and experience on certain
aspects of executive recruitment – economic outlook, average employee tenure and attitudes towards
job boards, for example – yet consensus on the core priorities, such as job profile elements and the
candidate’s fit to them being the most important consideration in recruitment.
Our research confirms that most companies continue to use a range of recruitment tools and methods
to identify senior managers and executives to hire. There is no “magic bullet”. Online innovations such
as social networking sites and, before them, job boards, facilitate connections between prospective
employees and the companies that might hire them, but paradoxically this makes recruitment more
difficult, increasing the time and process invested in screening out the less promising applicants.
With the rise in new online tools, it is surprising to note the degree to which personal connections
continue to drive the recruitment process in most organisations. Employee referrals were rated as one
of the best ways to identify good people and personal relationships – knowing and trusting the
individual recruiter who will be doing the work – emerged as the single most important determinant in
choosing a recruitment provider, outranking the track record of the firm, pricing or speed of service.
Many respondents commented on the need for flexibility and to understand the context in undertaking
any recruitment or employee engagement task.
A majority of respondents dismissed the idea of a “War for Talent” as not so relevant any more, if it ever
was. They commented on the nature of talent itself: whether it’s an absolute or context-dependent, and
whether recession intensifies or alleviates the competition for talent. For a majority of participants in
our research, their plans for future recruitment indicate hiring levels that are either steady or slightly
better than today, indicating a sense of cautious optimism about the future.
ABOUT EXECUTIVES ONLINEFounded in 2000, Executives Online is an executive recruitment company that harnesses the internet to
accelerate the search process. This delivers exactly the right candidates quickly, for interim or permanent
executive roles, in order to redress loss of competence and protect competitive advantage. What makes
Executives Online different is our award-winning online talent acquisition engine which can be deployed
instantly, worldwide, saving clients time and money. This builds Executives Online’s Global Talent Bank of
managers and executives seeking interim and permanent work, now numbering over 150,000 registered
candidates, and which all Executives Online recruiters draw upon in serving their clients.
Executives Online operates through 26 offices led by experienced business people who know their
local markets. That international network now extends to Australia, Belgium, France, Germany, Ireland,
Italy, Nigeria, Qatar, South Africa, The Netherlands and the UK. For more information or to speak to one
of our recruitment consultants about recruiting, call +44 (0)845 053 1188 or visit
www.ExecutivesOnline.com to find your nearest Executives Online office.
35
“When choo
sing
a recruitment provid
er, a personal relationship – know
ing
and trusting the individ
ual recruiter w
ho will be
doing
the work – was the
sing
le most impo
rtant determinant in choo
sing
a recruitment provid
er...”
“
a”
For a majority of respondents(73%) the picture for future
recruitment is either steady orslightly better than today,
indicating a sense ofcautious optimism about the future.
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