Specialists in sector or specialists in headhunting? The power of partnership over division of labour

Specialists are all we need, right? It comes back to the ‘Division of Labour’ principles that I regret are somewhat hazy in my memories of Oxford economics these days, but in theory, having services such as Executive Search perfectly aligned with highly specialist sectors would seem to be the optimal solution.

People who know everyone in their space should be able to provide a specific service in a shorter time frame, with less ‘exploration’, greater knowledge against which to make subjective and objective assessments and ultimately de-risk the hire for a given client.  Multiply that up and having specialists in each area should provide maximum market coverage and swift execution at the lowest risk, or does it?

I, for one, am not convinced of that argument because the benefits can (not always, but frequently) be outweighed by the very factors that make a good executive search good and that’s more often than not down to a tailored approach, your relationship with the client and the ability to access highly effective, dynamic networks.

So often, we are asked; ‘why should I use Eton Bridge Partners [as a generalist headhunter] when I have a whole load of specialists queuing up for my business?’ A very good question and one that gave me a lot of food for thought. However, the more deep-seated relationships we build with clients from a wide variety of sectors, the more assignments we successfully deliver on and the more we remedy poorly executed processes, the more I am certain of my response.

Upon joining Eton Bridge Partners, something my friend and ex. CEO and Chair of a global services group said has stayed with me; “I used a single firm of headhunters all my career and always tried to work with the same person who knew me better than anyone – simply because they gave me three things: trusted knowledge/data, structure to my critical hire processes, and discretion in successfully onboarding of those hires.”

Interesting that only one part of the above is knowledge based and only half of that refers to specialist knowledge of a given market… using his rationale (as a successful CEO of a global business), we are down to ½ of 1/3rd of the reasons for using a specialist headhunter being that specialism… anecdotal at this stage but I think it speaks volumes nonetheless.

As with all searches, there are two sides to getting it right in its simplest form:

  1. Knowledge of the market (‘network’); and
  2. Knowledge of a client (‘insight’, ‘relationship’, ‘trust’).

Given an extensive candidate network but no insight, relationship and trust to genuinely understand what the client needs, nor how those folks will ‘fit’, the process (or even worse, the hire) will not be successful with potentially disastrous consequences.

The former is readily known and nearly always easily accessible with technology, the right approach and a strong and diverse network. I would argue the latter is by far the most important and something that cannot be pre-judged. It’s not a question of specialism so much as intelligence, insight, trust and firepower to make things happen.

Indeed, with specialism, singularity of focus and a level of dominance in a given market comes three distinct risk factors:

  1. Reliance on existing network – not running a rigorous, wide ranging and detailed search risks missing first class candidates or candidates not overtly looking at new opportunities.
  2. The ‘black list’ – a very significant proportion of candidates who should be represented in any given process are simply not there – they cannot be approached because a dominant firm is contractually not allowed to do so. This ‘no-go’ approach can last for 12 months or longer after a piece of work.
  3. Specialisms become a limiting factor – it’s interesting to see headhunters increasingly used to identify candidates outside of a given fund/PLC area of focus and bringing them firmly into that field of vision. De-risking the hiring process is not just about finding someone who has done the same role in the same context on multiple occasions – arguably, that increases risk, and does not mitigate it.

I am not for a minute suggesting that specialists are not valuable. Nor am I suggesting that competitive tension amongst suppliers/partners is not important. An observation as someone who has been in global advisory businesses and then running my own industrial and tech organisations, is simply that both have their place.

Speaking now as Eton Bridge Partners, by focusing on candidates, the breadth of our practices and geographic reach provides a significant platform of ‘live’, trusted, known people to call on – allowing us to understand a given market and access, reference and assess leaders readily.  As one of the top two Interim Management Practices in the UK, we also have the luxury of trusted senior executives crossing businesses, sectors and regions every day.

Coupling this with an approach that is focused on being the most trusted partner to our clients, not just on a transactional basis but over the long term.  Partner-led searches with consistent, dedicated in-house research teams, first class technology and business leaders in the partnership team, we are free to focus on our client and the profiles we feel are genuinely right for their business, in the time frame and with the future potential they need.

Perhaps more important and something that can be missed in today’s always on, immediately connected world is that of long term, genuine partnership – two-way, proactive and engaged, even when not on mandate.

Frequently, I don’t think headhunters understand the value they can provide on an ongoing basis (and I have also observed how hard this can be to provide until trust is established with a client).  From informal introductions and ‘watching briefs’ to transaction opportunities, market information, personal support and strategic frameworks to attract, retain and combine talent (especially at Board level) in a holistic, carefully considered and insightful way. We as headhunters, are in an exceptionally privileged position and need to recognise it as such.

If this value added approach is of importance, it requires investment on both sides.  By working closely with one/a select number of partners, not only do businesses and funds not have to juggle a myriad of relationships and specialisms but they also allow their partners to invest in delivering a tailored solution that will help accelerate searches across multiple functional areas, with reduced risk of failure and a wider candidate pool from which to draw sustainably over time.

As with most things I have finally realised at the great age of 40 years, it’s a balance.  It also depends on how you define ‘specialists’ – ‘tech’, as an example, is not a specialism – tech is in every business and every business will increasingly become a tech business, just with different operating models attached.

To my mind, regardless of brand or focus, it’s the relationship and detailed understanding of client culture, requirements and future ambitions that count most.  Combining this with an action oriented attitude, first class service and breadth of coverage frequently outweighs benefits from specialisms (real or perceived). The bigger question is how do you start to build that relationship through demonstration of capability and commitment and, once established, how can it be constantly renewed?

Certainly, over the long run, having a genuine partner to help manage often challenging and fluid mandates with care, speed, trust and discretion is perhaps the more critical selection factor than the specialism vs generalist or global brand vs boutique questions so hotly contested.

Edward Fanshawe

Partner
Board Practice - Private Equity


With an MA (Hons) in Economics & Management from Oxford University and more than ten years in UK industry, Edward brings first hand experience of building, managing and restructuring high performing board teams.