TRANSEARCH International’s Managing Director, John Ryan, chaired a fireside chat in partnership with AESC and the IE Business School, an internationally recognized graduate school located in Madrid, Spain. AESC is the Association of Executive Search and Leadership Consultants. The fireside chat focused on executive search, how it works, emerging trends, and an insider’s perspective on how to effectively gain visibility within the search community.

Below, highlights from John Ryan’s Q&A during the fireside chat:

AESC:

To set the stage, please tell us about executive search firms (contingency firms versus retained search) and how that differs from an outplacement firm? Given the different kinds of – and numerous – search firms, which ones should a professional choose to work with?

John Ryan:

To keep this simple, there are two types of firms:

  1. Retained Executive Search follows a professional services model and is compensated on a contracted basis.
  2. Contingency firms work on positions that range from entry level to lower middle management. Typically, they do not have a relationship that is as tightly connected with a given employer since they are classically not exclusive in managing a recruitment mandate.

Also, there are firms of both type who are specialized not by just region but by industry. This is important to note. For example, there are smaller specialty firms who only work in education, healthcare, manufacturing, etc.

AESC:

What positions are in the greatest demand in executive search in the Chicagoland area at this time?

John Ryan:

  • Chicago continues to have a major presence in Professional Services, so there are always jobs with consulting, accounting and advisory firms.
  • There are numerous food & beverage and consumer goods companies in the Chicagoland area. Based on our experience, they hire sales and marketing people on a routine basis.
  • Industrial Manufacturing has a presence here, but we've seen some contraction in this market.
  • Digital and Technology is also a robust and growing segment.

AESC:

When hiring for C-suite roles, is there more of a trend in the direction of internal hiring or rather hiring externally?

John Ryan:

  • Following 2015, we generated a CXO Report that is good to reference. In this report, referencing more than 3,000 data points, we saw for all CXO positions across all industries that 68% were hired from outside versus 32% being promoted from within.
  • As far as a trend in either direction, there was a recent PwC study that stated: “Over the past several years more big companies have been deliberately choosing their new CEO from outside of the company as part of a planned succession, an indication that hiring an outsider has become more of an intentional leadership choice than a necessity.”

AESC:

Studies show that a culture of Diversity and Inclusion (D&I) contributes to creativity, entrepreneurial mindedness and innovation, which directly impacts the bottom-line. Can you talk about diversity and how do search firms support the clients that you serve in sourcing and attracting diverse talent?

John Ryan:

  • For an interesting read on the subject, I suggest the 2009 study by Dr. Cedric Herring, UIC – “Does Diversity Pay?: Race, Gender, and the Business Case for Diversity.”
  • Another good reference is a 2014 McKinsey study – “Diversity Matters.” A quote from it reads: “The analysis found a statistically significant relationship between a more diverse leadership and better financial performance. The companies in the top quartile of gender diversity were 15 percent more likely to have financial returns that were above their national industry median. Companies in the top quartile of racial/ethnic diversity were 30 percent more likely to have financial returns above their national industry median.”

AESC:

With the emergence of new technologies and new online research tools, how is technology, for example LinkedIn, changing the face of executive search and talent acquisition? Personally, do you accept invitations from candidates via LinkedIn?

John Ryan:

  • LinkedIn has massively changed networking; it has been transformational when it comes to talent. It’s become easier for professionals to share their information and for hiring contacts to access it.
  • We notice that certain functional roles embrace LinkedIn more so than others. Engineers for example, not so much. Sales, marketing, some C- level roles use it more so.
  • There is a good and bad to LinkedIn. I think on the negative side, it has created a certain type of working professional who job hops more than ever.

AESC:

What do you suggest executive students and alumni need to do to adapt to a fiercely competitive global business landscape?

John Ryan:

  • The simple message is “move to where there is opportunity” rather than stay in a location or country with a major surplus of labor.
  • The other theme is that people should move into growing markets and avoid contracting markets. After watching Rainer Strack’s interesting TED talk, “The workforce crisis of 2030- and how to start solving it now” it was apparent that there is a disconnect. However, the USA is the #1 location to which people want to move.

AESC:

Have you seen a clear evolution in the trend with regards to the skills demanded by your clients and how would you describe this? What skills are required moving forward, especially for the C-suite?

John Ryan:

  • One evolution would be which sectors are growing. Over the past 10 years, renewable energy has been a growth market and there have been an increase in jobs across most functional roles.
  • For our firm, automotive continues to be a segment with intermittent opportunities. Reason being automotive, in my opinion, is a segment absolutely beset with cost cutting initiatives and other pressures. But as pointed out to me recently, there can be job growth even in automotive.
  • It is more in emerging markets, and in specializations like data and analytics. Smart sensors, cognitive programs. Someday, autonomous cars. Electric vehicle has had growth.

AESC:

How does education need to change (structure and content) at the business school level to ensure that students and professionals alike are as adaptive as possible?

John Ryan:

  • Educators and the individuals who are responsible for the content need to keep it current and relevant to the actual sorts of jobs that are out there.
  • Programs also need to keep developing relationships with companies who are providing internship and externship opportunities.

AESC:

At what stage of their career should candidates start reaching out to executive search firms?

John Ryan:

Any stage. It’s a good idea to get into the databases of major and specialty executive search firms. We will keep track of you, and we appreciate the updates you send us. We note your preferences if you share them in terms of types of jobs, companies, and location.

AESC:

Historically we talked about a 7-year ideal tenure in a company. Nowadays the reality is more in line with 3-4 years. Have you seen a variation in the number of times that executives are making changes and how is this seen from the perspective of a search firm?

John Ryan:

The trend has been for tenure to decrease. It was 20 years in the past, now we are down to just a few years in some cases. However, there are still executives who have worked at their companies for more than 7 years. More so in the digital and e-commerce space, the tenure average is very short. Executives in such industries might take the risk of joining startups, but also might leave it at the first sign of trouble.

AESC:

Are you already using game-based assessments or tools that involve neuroscience in order to filter candidates or ensure better matching with certain opportunities and do you expect that we will see these used at the C-Level in one form or another?

John Ryan:

Our firm uses Hogan Personality Assessments. It’s an assessment that generates a report that notes an individual’s strengths, values and drivers. It also details areas of risk when stressed and in conflict, where individuals may need to be mindful when going about their work.

AESC:

In many markets, global citizens are more desirable and thus more hirable. How does one become a global citizen?

John Ryan:

  • One would accomplish this by seeking out international opportunities, potentially in your current employer or with other firms.
  • In the former, you would need to first join an organization that is truly global.

AESC:

Could you leave our alumni with one tip related to executive search and having a career in a disruptive world?

John Ryan:

Know yourself. By that I mean spend time thinking about what sort of companies are a good fit for you. There is a big difference between startups and multinationals. Ask yourself, “Which environment is the best fit for you?”

For more information about this event or AESC, please visit:

https://www.aesc.org/events/aesc-public-appearances/ie-business-school-executive-search-evening