Kelli Vukelic, CEO of N2Growth examines the nuances that distinguish boutique search firms from their larger counterparts. Here are some key insights into selecting the right executive search firm to partner with.
Senior leadership hires can make or break an organization. Various studies show that the failure rate of executives coming into new companies is 30 to 40 percent after 18 months. In a hiring market like the one we’re currently experiencing, finding a true game-changing leader is extremely challenging. Furthermore, making a hiring mistake is extremely costly in terms of both direct and indirect costs. So how do you find those top performers and disrupters that can take your organization to new heights? Internal recruiters do not have the tools or abilities to fill these critical leadership roles, their ‘open requisition’ stack is too full, and all roles get equal attention, whereas the most critical ones need a dedicated team. Once you recognize that an external search professional is needed, the decision for which one should be solved with a different calculus than in the past.
With demand for top executives outstripping supply choosing the best search firm to partner with can have a critical impact on the future of your organization. There are thousands of U.S. executive search firms that are looking to help to place talent in organizations. So how do you decide on which firm is the best fit? Should you use a large firm whose name is familiar to you because of ads and billboards? Or should you partner with a more niche, local boutique? Or should you consider a new emerging category of super elite boutiques that give you the best of both worlds, international reach, and creative, disruptive thinking? “I would caution that size is not always an indicator of success, and more importantly, not a risk mitigator,” said Kelli Vukelic, CEO of N2Growth, a Philadelphia-based management consulting and executive search firm. “A small elite class of boutique search firms is achieving this, providing you all of the executive search solutions of larger firms, but with a more hands-on, better-resourced approach. There is no one-size-fits-all solution to placing C-suite candidates. One-size-fits-one and having worked at both ends of the spectrum, here are my points for your consideration.”
Plethora of Choices
There are countless options when it comes to executive search firms. On one end of the spectrum are the incredibly large firms, which come with big brand name recognition, high overhead, and revenues reaching into the billions annually, according to Ms. Vukelic. “Several of these publicly traded firms have good reputations, but they have historically catered to Fortune 500 companies,” she said. “If your organization is not a Fortune 500 company, your search can easily get lost in the shuffle or pushed down below the partner level, and placement costs can quickly exceed your price range with antiquated administrative fees that cover big overheads.”
On the other end of the spectrum, however, are boutique search firms. “You may be skeptical of these smaller enterprises, fearing that they lack the resources and experience to find the right executive for your organization,” said Ms. Vukelic. “But these fears are often unfounded — in fact, boutique firms are often better resourced, making them a better fit for your search.”
Boutique Search Firms Offer a Personalized Approach
When engaging with a boutique firm, you are more likely to deal directly with the person or team leading your project. Typically, Ms. Vukelic notes that boutique firms create team structures to work on projects, and their “top-to-bottom” approach offers the client extraordinary attention to detail. “They can assess a client’s unique needs and then customize their approach accordingly,” she said. “An agile process allows time for listening, connecting, coaching, and advising. This personalized approach allows boutique firms to place candidates who are technically, academically, and culturally additive to the organization. This sets both the client and candidate up for success on the first go-around, saving everyone involved valuable time, money, and energy.”
By working with a boutique search firm on your C-suite placements, it is highly likely that you will interface and deal directly with the senior leadership of the company, according to Ms. Vukelic. “Direct interaction with the leader of the firm builds trust, allows you to voice any questions or concerns you may have, and get a real-time answer from a key executive,” she said. “A boutique firm will invest in learning your culture and talent needs. The senior engagement leader that works with you from the onset of the search will lead the process, speaking to every prospective candidate on your behalf. In a noisy recruitment market, where candidates have the upper hand, who do you want to tell your story and be that extension of you in the marketplace?”
Kelli Vukelic is CEO of N2Growth and is responsible for the firm’s global executive search and leadership advisory services. Ms. Vukelic has spent more than two decades in executive search. Her areas of expertise include talent operations and strategy, and C-suite executive recruitment, mainly but not exclusively in technology organizations. Earlier, Ms. Vukelic served as the chief operating officer of N2Growth. Before joining N2Growth in 2020, she spent 20 years with Korn Ferry in several roles of increasing responsibility. Ms. Vukelic is also the co-author of Leadership Recruiting: Consulting Skills for Recruiters, a resource for senior executive talent professionals at all levels.
By contrast, when engaging with a large firm, Ms. Vukelic explains that you may only speak with a partner occasionally as they are likely busy chasing billings and not focused on your search day-to-day. “Larger firms often delegate key work to less tenured associates that you have never met and who have only second-hand knowledge of your organization and its needs,” she said. “They also have limited experience, meaning they bring a narrower perspective to the candidate process. These are the people telling your story in the marketplace. This can result in candidates whose resumes match your specification on paper but may not align with your goals or add anything new or different to your culture. Large firms are usually in a constant state of growth, which limits the attention they can pay to your search. A sizable client base may be great for them, but it might not be best for you.”
Boutique search firms take the time to learn the intricacies of their client’s company culture and goals. They operate with the understanding that trust is built every day and with each interaction, not bought with brand name recognition.
Greater Executive Candidate Pool
“Executive search firms have an ethical and contractual obligation not to recruit from clients,” Ms. Vukelic said. “Because large firms conduct business with so many organizations, they have significant hands-off limitations which limit their recruiting strategies. Candidates that are active on a search within a firm are also off-limits for other searches. With large firms, this can equate to thousands of candidates who are unavailable to your search, severely limiting the talent pool.”
Transparent Search Process
Many partners at large firms cannot describe their process in detail and often don’t adhere to an established methodology. Ms. Vukelic notes that this is because it is difficult to consistently execute a data-driven methodology within a large firm. Boutique firms are generally more transparent about and invested in their differentiated process. Ms. Vukelic emphasizes that you should expect to have access to data about your engagement and real-time reporting allowing you to better communicate and collaborate with the search firm.
Focus on Your Engagement, Not Upselling the Engagement
Cross-selling ancillary services is a huge priority for many large firms, so much so that partners at these firms are as concerned with cross-sales as with the search itself, and their attention is diverted from what you contracted them for in the first place. “Conversely, boutique search firms are, by and large, strictly focused on retained executive search and only solutions that enhance that process during or after an engagement,” said Ms. Vukelic. “Rather than diversifying into other services such as organizational design, boutique firms will often refer their clients to specialists, ensuring they remain focused on the task at hand.”
Search Firm Completion Rates
When meeting with a search firm, Ms. Vukelic notes to ask what their completion rate is. She explains that you are likely to see that larger firms—which, by virtue of their size, can afford to leave a search unfilled— don’t have as strong a record of bringing candidates across the finish line as their boutique counterparts. “The constraints on large executive search firms are real; they limit the firm’s ability to bring great candidates to you and contribute value to your organization,” she said. “When selecting a firm for your search, critically assess the quality of service you will receive, instead of simply picking the largest firm on the market that can rattle a long list of past clients, which are now likely off limits to you.”
Generalists over Specialists in Search
Any day and every day Ms. Vukelic says that she would pick a generalist. “Specialists by function or industry, while very knowledgeable and subject matter experts, tend to be less creative about where to find disruptive talent,” she said. “Most search firms don’t know what clients want because they don’t know what questions to ask outside the stock list. The industry needs to move beyond the HR and talent acquisition world and that line of questioning to expand thinking and explore the art of what is possible. If you want to see the best leaders, look for leaders rather than a checklist of skills and experience. Many clients are seeking to challenge old norms with known networks and specialist search firm models are too narrow and candidate recommendations are to be expected and boring.”
Closing Thoughts on Selecting a Search Firm
“Large search firms may seem appealing due to perceived brand value and organization size, but when it comes to the attributes that will serve you and your goals, get to know the new class of boutique firms as you may find that they provide a better option for your C-suite talent needs,” Ms. Vukelic said. “Big enough to have significant horsepower and global reach, but not so big that they lose that relational, bespoke approach that is just for you and your organization.”
