Search Firms Handle Tough Times Carla Joinson

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Today's economic outlook has kept many companies in a holding pattern when it comes to adding personnel. Those that do need to hire are looking at ways to cut costs; turning to the Internet and in-house resources can be particularly attractive when it comes to recruiting.

"The activity at search firms is a good leading indicator of where the economy's going," says Alex Baxter, marketing director at Lucas Group, an Atlanta, Georgia-based search firm whose medical/scientific team specializes in recruiting executives for biotechnology, pharmaceutical, and other scientific fields. "Job orders have been down for the past two years."

Baxter explains that many companies will look at the market and think, "we're downsizing" or "we're cutting costs" and assume that using a search firm is a luxury. That kind of thinking can be a mistake however, he says. "In a poor economic environment, you need 'A' players to thrive and survive, which really does necessitate a search firm more than ever."

Jerry Lareaux, president of The Hampton Group, a Southampton, New York firm specializing in recruiting executives for biotech, pharmaceutical, genetics and life science companies, agrees. "Today, there's more pressure to find outstanding people. When times are tough, you need the best—you need an edge."

Over the past few years, corporations have made strides in career web site design and technology advances such as applicant tracking and resume filtering systems. But HR departments are as likely to face cuts in staff and resources as the rest of the company, or have a myriad of other tasks that require attention. Can recruiting through job boards and company web sites really give businesses the best candidates the most efficient way possible? Or do search firms still have a place in tough times?

Let HR Focus On Core Strengths

If HR has established metrics for their recruiting function, they can easily see whether or not using a search firm makes sense. Common metrics to analyze include: cost per hire, time to hire, retention rate and quality of hire. Little data may exist for high-level, infrequently filled, or specialized positions, but these can be exactly the positions that require the most time and expertise to fill. If a company sees only an occasional need for this type of hiring, it could make sense to pay a search firm to do the task quickly and efficiently.

At Franklin, Mass.-based Cohesive Technologies, a company that designs and manufactures liquid chromatography solutions, HR prefers to use the company's internal referral program to find potential employees, says Sandra Skiesgelas, an HR consultant who works with biotech companies. "Unfortunately, we just don't always have the time," she says.

Time is one problem for most HR departments, but the search itself can present another. While corporate Web sites and job boards work well for lower- level positions, candidates for specialty or high-level positions don't typically rely as much on these venues; unless the company has the time and money to pursue these candidates elsewhere, they may not find the best people.

Another predicament lies in the type of candidate companies really want, particularly during tough times, says Baxter. "You want a passive candidate-someone who's happy with his or her job."

HR's usual recruiting methods may yield few results for this kind of candidate. "The only thing I can do to duplicate a search firm in-house is to use my corporate Web site," says Jack Keehma, chief operating officer at Independent Forensics of Illinois, based in Chicago, Ill. "Candidates may send a resume, but generally the people you want working for you are already working for someone else."

Baxter agrees. "If you're looking for 'A'or 'A+' candidates, they're not posting online—HR needs someone to get into companies and find the passive candidates," he says.

Recruiters today rely on sophisticated search techniques like Boolean queries that use complex search strings incorporating inclusive and exclusive parameters, or flip searches that mine data by following links from relevant sites. Other effective, but time-consuming techniques include searches into relevant directories and databases, and hunts through articles and research papers to unearth names and data. Old-fashioned cold calling and detective work within targeted companies also remain a staple.

"An internal recruiter doesn't have the resources of a national search firm-we have researchers who spend the entire day getting into organizations to find the right people," says Baxter.

Lareaux points out that it's often hard for HR to network beyond a certain level, which can make certain high-level searches difficult. "And you don't want to be seen having your people calling the competition. It isn't becoming, and can even be a little embarrassing," he says. "It's better to have an intermediary do it."

Skiesgelas agrees. "Search firms can go into companies that it wouldn't be quite right for me to go into," she says.

Though her company continues to use a variety of recruiting methods, including referrals, a corporate Web site, and niche job boards, Skeisgelas acknowledges one of the primary attractions of search firms.

"They just have a network that's so broad," she says. "Particularly the ones that specialize."

Tap Into Built-In Expertise

Unless a company has a dedicated recruiting staff that hires scientists on a regular basis, search firms may have more expertise in this area than the typical HR department. "Even if you see enough key words or phrases on a resume to generate interest, you still have to spend a lot of time talking, to find out issues and what the candidate brings to the table," says Lareaux. "You need a professional interviewer who can understand what they see in a resume."

Baxter adds that scientists aren't as prepared (as most job seekers) when they go through the search process. "A lot of our recruiters help candidates with resumes and interviewing," he says. "Many of these candidates aren't well versed in managing their careers, either, so we do a lot of hand-holding."

HR might also benefit from using search firms on a consulting basis, says Baxter. He explains that search firms learn a lot about candidates' needs and perceptions during frank discussions prior to making a match. "Companies can ask 'What makes a firm like us more appealing?' or 'How can we attract more good people?'" says Baxter. "Scientists can be a little temperamental; they need to feel comfortable. We can help companies understand what they need to do to answer these questions."

Use A Search Firm Wisely

Keehma says that in the past, he worked with a large number of search firms. "It was sort of like using realtors—you want to have every realtor in town looking at your house on a multiple listing service—so if I was looking for a person, I wanted to have everyone helping me get a lot of resumes."

Keehma says he's changed that approach over the years, however, and now uses just a couple of firms he trusts. "Some people just 'get it' and know what you're looking for-and then they go out and find it for you," says Keehma. "They do all the work for you. Other firms just gather resumes and expect you to sift through them."

His experience underscores the importance of finding a match between a search firm and your own company's requirements. "Go to the search firm's Web site and make sure that it's fresh and up-to-date," says Baxter.

To get the most from any firm it chooses, HR must know what it wants and partner with the search firm, say professionals in both groups. "Be open and honest about your needs and wants—don't hold back," says Lareaux. "And if you don't like what a firm offers, say so and the firm can keep looking." He says that it's important to be candid about compensation. "We can't present a candidate without this information," Lareaux explains. "But with it, we can present reasonable candidates."

"Every search is different," adds Baxter, "so you need to be sure you have a caring firm with good customer service." If there has been good communication between the two organizations, HR should expect a search firm to present pre-screened, viable candidates that fall within the salary range offered by the company.

Despite the general slowdown in hiring, many experts predict an eventual shortage of workers as baby boomers retire. Some experts also feel that today's economic climate is a good one for looking at a company's human capital in general. "If you feel existing talent isn't as good as you'd like, and you think training isn't going to address it, this is a good time to take a look at outside talent," says Lareaux.

What's important for HR is to find the best talent—whether that's through a search firm or their own recruiting efforts. Finding and locking in good people while there's still an excess of qualified candidates in the job market will position their companies for success both now and in the future.

Carla Joinson is a Stafford, Va.-based writer specializing in human resources and management topics.