Want to Recruit High Quality Talent? Get Aligned with the Market!
June 26, 2008
One of the common challenges in executive search is aligning client expectations with the candidate market. Take the typical start-up for example. Almost every start-up envisions itself as tomorrow’s monster success. Their widget, software, system or application is going to be big, really big, and only a fool would fail to see that. And though statistically only a small percentage of start-ups will ever cross that golden finish line, a measure of certainty and audacity undoubtedly immunized each and every one against the doubters and skeptics lurking every step of the way. As a result, a level of certainty and bravado must be respected.
But for some companies, confidence borders on hubris. They feel entitled to hire anyone they desire, and at whatever compensation they deem fair for that privilege. They believe they are above the market, able to engage it on their own terms. They set the recruitment bar inordinately high and dismiss any intimations of misalignment with the candidate marketplace at large. We were once retained to help a Canadian IPTV technology company in need of a senior executive. The young CEO wanted the ‘best of the best’ and went so far as to insist that candidates boast not one, but two successful exits among their accomplishments (just in case the first one was a fluke). When candidates subsequently dared question the hype versus substance of the IPTV market, the need to relocate to a small Canadian city (another non-negotiable requirement) or how this firm expected to compete against the likes of Microsoft or Alcatel, they were dismissed as myopic doubters. We were then accused of lacking the requisite skills to represent them properly in the marketplace.
Hubris is the proverbial hallucinogenic Kool-Aid that distorts the inconvenient reality that markets are logical. Competent people are not stupid. They have choices and are discerning in evaluating those that come their way. They have a habit of asking ‘why’? Why would I leave my company to join your startup? Why would I move laterally to work for you? Why would I pick up my entire family and move it across the continent for this opportunity? Why do you think the compensation package you are offering is attractive and why do I care about your internal equity issues? Why do you think this stock option package is attractive given the preferred share structure that is in place? In the game of recruiting high performers, there are Kool-Aid stands on every street corner and competent people know the good stuff from the bad.
Companies misaligned with candidate markets almost always incur costs of time and productivity. In the case of our IPTV client, countless high caliber candidates turned them down over a period of many months before they acknowledged that perhaps, just perhaps, adjustments were needed to the requirements. It was an unnecessarily painful journey that ultimately cost us our relationship with the firm. Moreover, time has born out the fact that the star candidates were correct in the assessment of the firm’s prospects, which remain unrealized.
Companies have every right to set the recruitment bar as high as they please. But for the vast majority, coveting talent has little bearing on the likelihood of landing it. For this, firms need to understand the levers which guide how talent flows, the competition for that talent, industry dynamics, best practices in that market. They need to know the labor market they are tapping into, understand where they are positioned and plan for how they will optimize their chances to attract the caliber of team members they need. They need to be aligned with the market .