The Fundamental Flaws of Recruiting through Headhunters

by Tom "Bald Dog" Varjan, Organisational Provocateur

Over the last few years it has become increasingly popular to use recruiting agencies for finding new colleagues. When labourers are hired this way, it may be reasonable, but this huge mistake and is a cardinal sin for professional service businesses.

While in other industries people are merely regarded as controllable expenses (some call it necessary evil), in a professional service business people are supposed to be the greatest asset of the firm. Acquiring the greatest asset is hardly ever delegated in other industries, then what is the logic in delegating it at so many service firms.

McKinsey & Co., the No.1 professional service firm invites some 50,000 resumes every year, senior partners and directors personally conduct 10,000 plus interviews and then they recruit 500 people. The firm used to believe that their focus was on the client. Then they shifted to focusing on their own people, and people in turn will focus on clients. And it has worked. It is also important to note that the firm invests a small fortune in the ongoing skill-building of its people.

Most firms are more than happy to sacrifice their own people in order to “get” one more client. How amazingly stupid.

Headhunters live up to their expectations, and they successfully hire the heads of people. Unfortunately, without the heart the head is of not much value. What is in the head? A bunch of memorised data in different shape or form. Experience is really when we combine this information with some “heart stuff”, like intuition.

What is the logic in personally selecting your office complex, the photocopier and the company vehicles, and then relegating the role of acquiring your greatest assets, your people, to a third-party agency.

It is the equivalent of asking your friend to make your wife pregnant, because you need a baby by Easter, but you have neither time nor inclination to do it yourself. The example is pretty wild, but demonstrates the point.

What is the message sent out through the recruiting agency?

Simple: Our people are NOT important enough for us to take time and handpick them personally.

And guess what? If people are not important enough before recruiting, they will not be important enough after recruitment either. Why do you think talent attrition is so high among professional service firms? This is definitely one reason. And since most firm promotes internal competition, when colleague leave, they are highly likely to take their clients with them.

Firms keep shouting at the world the they want to partner up with their clients, while treating their own people like crap. I believe, first they ought to partner up with their own people and create the kind of environment in which people are excited, energised and enthused to do their best and beyond day in day out.

Some recruitment tips

Never hire just because you have a need. If you wait until the need arises, you have to rush, and will fill the position with the person who was the best at inflating his/her resume. Hiring on a resume (Ridiculum Vitae) is a call for disaster anyway.
Hire for the culture not only for technical skills. Some 80% of success in the service professional business is of emotional nature, such as social skills and interpersonal skills.
If you believe in your firm, show it. Recruit in advance.
Involve the whole team in the recruiting process, and stay away from headhunters and hiring agencies, unless you want to hire mercenaries who are driven by money only.
Understand that during interviews with good candidates, you and your firm are the sellers - of an opportunity - and the candidate is the buyer, not the other way round.
Be honest about what opportunity your firm can offer. Far too many firms brag about great bonuses, but after being recruited, all new colleagues get are whips and chains, and being treated as indentured servants.
Set up an internal mentor system for new people. That will reassure quick skill development and enhances loyalty.
Recruit people for their enthusiasm, excitement, sparks in their eyes and springs in their steps. Remember that experience teaches us in a millennium what passion teaches us in an hour.

The basic difference is that while other industries hire people for jobs, professional service firms ought to recruit people for careers. Failing to distinguish between the two can cause high talent and client turnover, and gradually eroding revenues.

On a side note: The "professional service firm" also happens to be the least profitable business model in the world. I mean the model is good, but more often than not the people who sit in the driving seats are not suitable for the position. A good lawyer doesn't necessarily make a good leader for a law firm.

Copyright 1997-2010 Tom "Bald Dog" Varjan. All rights reserved. You are free to use this article in whole or in part. One favour though: Can I ask you to you include complete attribution, including a live website link. Also, can you please let me know where you plan to publish the article.

The attribution: This article was written by Organisational Provocateur, Tom "Bald Dog" Varjan of Dynamic Innovations Squad, a firm specialising in helping consulting firms to sell their expertise at the highest margins. Get Tom's free Practice Management Black Paper when you sign up for his monthly newsletter, Commando Consulting: Lessons And Practices From The Ultimate Professional Service Firm, The Military. Visit Tom's website at http://www.di-squad.com.

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