ATLANTA, GA - Before this post, a brief word about the economics of my business: I am a contingency based ecommerce recruiter. The word contingency means that I get paid a fee if, and only if, my candidate is hired by my client. If no candidate is hired, or if my client hires an ecommerce candidate through another channel, then I make nothing. Nada. Zilch.
It's like being a fur trapper: Some days I get the bear, some days the bear gets me.
Like 90% of the world's contingency recruiters, my fee equals 20% of the candidate's first year base salary. An average invoice can be $30-40K. That sounds like a fortune until one realizes that clients will do anything to keep from paying it -- and that doesn't make them bad people.
Very often I will work for several months on a particular search without making a dime. If the client hires the candidate through another channel (say, an internal referral, or TheLadders), then I make nothing and have wasted a considerable amount valuable candidate relationship capital plus dozens of hours working for free when that same time might have been more profitably allocated to another project. But I love it.
I am in the Leader Identification business.
One of the smartest guys I ever worked for used to say "people will only pay for that which they cannot or will not do for themselves." Remember that phrase, as it will make you a more effective leader.
Now then: The goal of my business is to source "game changers" for my clients. These are the ecommerce executives who not only can do the job required on the client's job posting, but can also contribute something lasting and meaningful to the client's strategic thrust and the existing management mix.
The goal, obviously, is to source ecommerce candidates who are so good that my $30-40K fee will be lost in the rounding of the value that my candidates will create for my clients. This is not a sales pitch; it's just simple economics. My candidates need to be better motivated, better prepared, better skilled, and (most importantly) have better ideas than "regular" candidates.My candidates almost NEVER come from job boards because my candidates have to be at least $30-40K better than run-of-the-mill applicants. Otherwise, why would any client use me?
I have placed candidates who have helped my clients identify and develop promising new markets, brainstorm and introduce profitable new products / services, launch new continuity based loyalty marketing programs, dramatically improve my clients website conversion rates -- and more.
Indeed, from the 80-or-so ecommerce searches I have closed, I have placed a number of candidates for whom I would have MUCH preferred to have gotten paid a percentage of the value they created for my client rather than a 20% search fee.
Clearly, making this kind of the contribution isn't just about doing what's on the job description. It's about thinking like an owner. It's about thinking strategically. It's about being able to take a very high level view of the business, now and in the future.
Most of all, it's about VISION.
Vision can be defined as a realistic, appealing, and focused picture of the future that identifies both a goal and a general strategy for achieving that goal. According to management author Ray Johnson, any vision worth it's salt must satisfy four criteria:
- It must clearly define an important future goal, or at least a major direction for the company (or department for which the candidate is interviewing.)
- It must be exciting or enticing enough to provide the motivation for people to follow that direction.
- It must be articulated with clarity and commitment to provide guidance and coordination for disparate groups
- It must outline a general strategy for achieving the goal.
In the fall of 2009, I started asking all of my director and VP level candidates a series of questions designed to assess their strategic literacy. Here are some of the questions I ask:
- Very specifically, who is your customer? Describe them for me in as much detail as you can. Vague answers and short answers are a BIG problem. I am looking for longer answers that demonstrate a strong affinity with the target market. The candidate should sound like they LOVE their customers! Do they hang out with them in person and online?? That's a major PLUS.
- As it pertains to your product or category, what are your customer's top three daily frustrations? Let the candidate talk! Don't say anything for at least 120 seconds. Make them sweat. Also, understand that Domino's fully understood that their customers cared a lot more about delivery than the quality of the pizza. Sure, the pizza was okay, but that wasn't the point. The point was delivery -- and that was a service attribute the was previously unaddressed in the pizza category. Does the candidate have edgy ideas? Innovation comes from the edge.
- What are you doing to alleviate your customer's frustrations? Listen for pie in the sky suggestions that indicate that the candidate hasn't given this any thought. Hint: Is there a disconnect between their current business model and the suggestions they are making?
- What factors distinguish winners from losers in your category? Only two words matter: Marketing and Innovation. Many people overlook the fact that all companies are in the emotional bond business. If your candidate starts rambling on about price, quality, speed, etc -- then you've gotta wonder if he really empathizes with the customer. That's a marketing issue. Next, consider innovation: Imagine you had asked a fax machine manufacturer this question ten years ago. Would price, quality, and speed have mattered at all? You get the point. Disruption happens.
- How can you increase barriers to existing competitors and potential new entrants? Warren Buffett calls these barriers a "moat around one's business." Again, the best answers will have something to do with marketing and innovation. BONUS POINTS awarded for candidates that seem to have a process for these things. Get them to step you through it.
- What threats and vulnerabilities does your company face? The answers should sound something like this. You are looking for e-commerce executive who can think holistically about their business -- and yours.
- If you left your company today, how would you compete against it? I freaking love this question because most e-commerce candidates simply think in terms of just doing more, better, faster, and cheaper. I've got news for them: Someone's always going to do things better, faster, and cheaper. How can you do things more intimately with your customer?? In the words of Marshall Field, "People return to the place where they have proactively been made to feel special."
- Describe a best case and worst case scenario for your company in the next three to five years. Then ask Why? Why? Why? Why? Why? The best candidates will be able to think logically yet abstractly about these issues. They should understand financial risk, supplier risk, technology risk, market risk, and customer risk and be able to consider those thoughtfully.
My point here is that there is a difference between doing the right things, and doing things right. Candidates are expected to do things right. Tight execution is simply the price of admission these days.
However, as we have all learned by watching Google, Microsoft, Disney, and Apple redefine and grow their businesses, the right people asking the right questions can have a much greater impact that just a few thousand dollars in recruiting fees.
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