The Morgan Samuels Perspective

The Compensation Question: To Share or Not to Share?

Posted by Morgan Samuels on Wed, Oct 12, 2016

unsplash_compensation_piggybank_cropped-1.jpg

 That icon of etiquette, Emily Post, once said a very well-bred person never speaks of money except during business dealings.  Times change, etiquette evolves, but even now people are skittish about the dreaded Compensation Conversation.  It becomes the elephant in the room – the monster under the bed – but it doesn’t have to be.  In fact, when it comes to retained executive search, it is a two-minute conversation that should be viewed as an opportunity to show not what you make, but what you’re made of.

Senior Client Partner Alison Woodhead and Director, Recruiting Ali Brainard two of Morgan Samuels' most experienced recruiters point out that the compensation question is only one data point.  It’s analyzed with a whole host of other factors to determine the candidate’s fit.  “We want to get an understanding of the candidate’s compensation just to get an idea of their experience and expectations, and to assess opportunities,” Brainard said.  “If they’re way over or under the mark we don’t want to waste anyone’s time.”

“Be confident about your value and what you bring to the table.” - Alison Woodhead

That being said, there may be a huge range the client is willing to pay for the best talent, and someone below the mark could reap the benefits.  Woodhead has seen up to 75 percent increases in compensation, for example.  And Brainard points out that if a candidate is being paid way above or below the market, it can mean any number of things.  Someone getting three or four times market rates may be extraordinary, but someone way below the mark may be just as talented. Perhaps there are other variables, like cost of living, staying with one company too long, or working at a start-up where the compensation structure is different.  In that case, they just need the right opportunity to take the next step up.

AlisonWoodhead.jpgSome people believe that if they share their compensation right off the bat, they lose bargaining power in the negotiation stage.  But a candidate for a senior executive position isn’t a dime a dozen.  He or she has a very unique set of qualifications, and clients will pay for top talent.  In fact, Brainard and Woodhead have found that the strongest candidates, people who have been successful in their career, don't think twice about throwing out that number.

“When you’re exploring an opportunity, your focus as a candidate needs to be on your fit with the opportunity and what you bring to the table,” says Woodhead.  “If you’re too focused on compensation, either hiding your compensation or positioning yourself for a good negotiation later on down the road, you’re going to come off as insecure.  You also waste time and energy too early in the process.  The recruiter or hiring manager doesn’t even know if you’re valuable yet, so why would they spend time thinking about what to pay you?”

Senior Client Partner Alison Woodhead

AliBrainard.jpgWhat people don’t realize is that a recruiter can be a treasure trove of information and data.  They can tell a candidate if they really are undercompensated compared to their peers, and a candidate should feel comfortable asking that question.  It’s not only more than acceptable; it shows honesty, transparency, and trust in the recruiter.


So remember, when it comes to negotiation the most critical thing is to come across as capable and confident.  Regardless of what you’re making today, have a clear sense of your worth, and trust that the people on the other side of the table will see that value.  Companies are willing to pay for that.  VISIT US HERE!

Director, Recruiting Ali Brainard 

Topics: morgan samuels, retained search firms, compensation, executive search, talent

Retained Search vs.Contingency: An Executive Recruiter's Perspective

Posted by Morgan Samuels on Fri, Sep 16, 2016

It can be difficult for a hiring company to decide whether the services offered by an executive search firm are necessary or whether a contingency firm might suffice. Morgan Samuels Associate Consultant Robby Kempton is one of our executive recruiters and sells career-defining opportunities to senior executives and C-level candidates every day.  Ms. Kempton has experience working on executive searches with both retained and contingency firms.  Understanding the differences between retained search firms and contingency firms is the first step to understanding their value and the best fit for your company’s needs.

unsplash_businessman_suit.jpgWith thousands of potential candidates competing for coveted senior-level opportunities, executive search firms can be valuable partners in helping companies identify and attract not only top talent, but those best suited for the particular role and company culture. “Retained executive search firms like Morgan Samuels truly collaborate with the hiring company to deeply understand the strategic needs of the business and how the role will contribute to the future of the company, as well as more nuanced elements like company culture.  Morgan Samuels recruiters scour the universe to seek out the most qualified talent that matches the specific needs for each role,” says Kempton.  "Unlike contingency firms that tend to rely on their existing database, retained executive search firms are more likely to reach out into the market to recruit 'passive candidates' -- executives who are not actively looking for a new opportunity, but may be a strong fit for the role. Contingency firms are likely to have a large pool of candidates in their database to shop around to several companies who have broader and more open criteria.”

Contingency and retained search firms also have different business models.  “As the name implies, retained search firms are paid a retainer to source the best possible talent.  They are typically the only firm engaged to fill the role and are paid for their services at the start.  Contingency firms, on the other hand, are only paid upon placement and may be competing with several other firms in the market.”

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Robby Kempton, Associate Consultant

Retained search firms and contingency firms also differ in terms of the advantages they provide.  “The advantage of retained search is that by partnering with the firm, the client company has a greater chance of finding the best candidate in the market, who possesses the specific requirements for the role,” says Kempton.  “The level of the talent and the loyalty of the candidate significantly increase when they are paired with a search firm that aims to match stated requirements, like educational background and work experience, versus candidates in an existing database.”

The way that candidates are found also varies between the two types of firms.  According to Kempton, in most cases with contingency firms, the candidates approach the firm, especially if it is a reputable agency.  Retained search firms seek out the best specific talent in the market, targeting certain companies and industries and reaching out to candidates with the skills and backgrounds that meet the client’s needs.

The use of executive recruiters through both retained and contingency firms can benefit any company.  Whether searching for senior-level executive placements or mid-level executive placements, executive recruiters can provide value.

"For higher level placements, including C-level, it is beneficial to use a retained search firm, because there tends to be a very small selection of candidates who possess the specific skills, experience, qualities and culture fit the client is looking for,” says Kempton.  “On the other hand, contingency firms are more appropriate when the needs are not as specific and there is a large pool of qualified candidates in the market.”  Kempton believes that both types of executive search firms are beneficial and can serve as extensions of the client’s Human Resources department.  Both types of firms provide the most value when they are viewed as true partners to the HR department, working together to find the best possible talent based on the hiring company’s strategy, culture, challenges and key business objectives. 

For more information on retained search firms, how they work, and how executive recruiters can add value to your hiring process, contact Morgan Samuels.

Topics: executive recruiters, retained search firms, top executive search firms

Not Sure You Want the Job? Do Your Homework Anyway!

Posted by Morgan Samuels on Wed, Jul 20, 2016

It’s common advice that the key to nailing an interview for a job you want is preparation.  But what about an interview for a job you don’t necessarily want?

stocksnap_homework.jpg“Even if you’re not interested -- prepare,” says Bert Hensley, Morgan Samuels’ Chairman and CEO. After all, there may be
 an upcoming opening that is more appealing – either at this company or at another client company through the executive search firm.  “If you get good feedback from a client, then search firms will think of you again.  You have an audience beyond who’s in the room.”  

Executive search firms place candidates in two broad categories: active and passive.  Active candidates are actively seeking new employment, while passive candidates are generally happy in their current roles. 

“Passive candidates sometimes don’t prepare like they should.  There’s a perception among executives that they benefit from being coy or playing hard to get in the interview process,” Mr. Hensley says.  “In my experience, that’s not the case.”

 “Go in prepared, or you’re better off not doing it,” he advises. 

 

How to Prepare: 

  • Know Your Numbers. Be able to quantify your own performance, but also understand the performance of the company.  If the company is public, read their annual reports online. 
  • Know Their Story, and Yours. Be able to describe your career as a narrative and a journey.  How did you get where you are? What have you learned?  Also know the hiring company’s story.  Know its history and read through recent press releases to learn recent developments.  Research the professional background of the interviewer. 
  • Know the Industry. Research what trends are impacting the company, both positively and negatively.
  •  Ask Pointed Questions. Why is the position available?  What are their expectations?  What roadblocks would you face?  Are there opportunities for growth for someone in this position?  Both parties need to understand whether the placement is a good fit or it won’t last long, if you do decide you want it.

 Remember: interviewing for a job is always great practice, even if you’re not sure you’re interested in it. Look at it as an opportunity to shake the rust off your interviewing skills. That way, when you get to interview for your dream job, you’re ready to nail it.

BertHensley-1.jpg

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Topics: executive recruiters, morgan samuels, leadership, human capital consultants, executive search firms, retained search firms, interview tips, talent

What Makes a Great Private Equity CFO?

Posted by Todd Wyles on Mon, Nov 16, 2015

For private equity investors, ensuring they have the right CFO is widely thought to be the most critical decision they will make from a talent standpoint, second only to installing a top CEO.  

unsplash_businessman_suit2.jpgOver the past three years, nearly forty percent of all the PE-backed searches Morgan Samuels has conducted have been CFO searches.  Why is this search such a common one throughout the investment cycle?  Is there a common profile for the best CFOs?  And if there is, what are the specific attributes that are most often observed?

In an attempt to answer these questions, Morgan Samuels has captured and analyzed extensive quantitative and qualitative data from CFO searches we have conducted for PE-backed businesses ranging in size from $8M - $75M EBITDA, across multiple industries.  By culling the data collected from assessing hundreds of chief financial officers for these searches, we have identified three critical attributes of great CFOs for PE-backed companies:

  1. They all have the desire and ability to be a true partner to the CEO, both internally and externally.
  2. They have command of the levers and metrics that drive value in the business, and they play a major role in executing the strategy.
  3. They are hands on, decisive, and they have a very high sense of urgency.

Let’s look at each of these characteristics in more detail:

True Partner to the CEO

This may appear to be a relatively soft attribute and difficult to measure, but based on our experience a CFO must not only fit the culture of the portfolio company, but also the style and vision of the CEO.  And they must simultaneously focus on both the internal and external aspects of their position.

One of the reasons the CFO role is so critical to get right at a PE-backed company is that they must have the skills and ability to advance the vision and strategy of the CEO, across multiple functions. They need to be able to translate the financial impact / projected outcomes of the strategy across the organization.  This is the internal aspect of becoming a partner to the CEO. 

Additionally, they must be focused externally.  They need to manage banking relationships and ensure covenants are not broken.  They often own multiple professional service provider relationships.  Perhaps most importantly, they have to be comfortable serving two masters – both their CEO and also the Board which will typically include at least one senior member of the GP.  And when it comes time to exit, the CFO plays a major role in interfacing with potential buyers, which requires both strong presentation skills and the ability to influence buyers.

Metrics Driven

Cash is King is a trite anecdote.  But for many middle market private equity-owned companies, it is still a very relevant mindset.  Most control investments are levered such that the management team has to be extraordinarily thoughtful about how they manage cash to ensure growth (whether that be organic, or via acquisition) and liquidity.  The CFO is at the tip of the spear regarding cash management.

One CFO we recently placed at a $150M business services company recognized within about 30 days on the job that the company was going to run out of cash 60 days later!  The CEO and the Board were not as aware of this, and so the very first order of business for this CFO was to create a set of metrics/KPIs that provided visibility for cash management on a daily basis.  That is how critical managing cash can be for a midsized business, and CFOs who install systems to ensure this happens are the most successful.

Hands on and Decisive

One of the most striking differences we have observed in successful CFOs for middle market companies with private equity owners is that they truly appreciate (and accept) that resources are at a premium, and that time is of the essence. Very few CFOs in private equity enjoy the resources (both from a staff and budget perspective) that their counterparts in the marketplace have.  Similarly, they do not have nearly as much time to create value for the PE-backed business, with an exit often only a few years away.  Being willing to get their hands dirty—and do it quickly by making great decisions (often without as much information as they would like) are hallmarks of the most effective private equity CFOs.

Private Equity Practice Leader Todd WylesA private equity firm’s greatest asset lies in its people and their capabilities to deliver across a myriad of stakeholders’ expectations. Top talent that is a great fit for private equity is extraordinarily scarce across the board, and finding the right CFO is especially critical to success. We have conducted dozens of successful CFO searches for PE-backed companies over the past few years, and we have found that candidates who possess the criteria described above thrive within the unique demands of private equity.

Click here to find out more about Morgan Samuels’ Private Equity Practice.

 

Topics: executive recruiters, morgan samuels, lean six sigma, human capital consultants, executive search firms, retained search firms, retained executive search firm, top executive search firms, Private Equity, PE, executive search, executive search consultants, Todd Wyles, CFO, executive search private equity

A New Front in the War for Talent?

Posted by Morgan Samuels on Thu, May 23, 2013

Todd Wyles Morgan SamuelsThe May issue of PE Manager includes a piece by our firm's own Todd Wyles on how private equity firms approach talent management across their portfolios. Increasingly, PE firms are adopting an Operating Partner in charge of Talent or Human Capital to help facilitate executive hiring at their portfolio companies. Todd interviewed several Heads of Talent, including leaders at Genstar Capital and Welsh, Carson, Anderson & Stowe to learn how they create value.

Todd is the Private Equity Practice Leader at Morgan Samuels. As a human capital consulting firm, we are always enthusiastic about putting a focus on talent issues. We think the emergence of the Head of Talent role at PE firms is a positive development in the private equity space for reasons outlined in Todd’s commentary.

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Topics: executive recruiters, top executive search firm, morgan samuels, lean six sigma, human capital consultants, executive search firms, retained search firms, retained executive search firm, top executive search firms, Private Equity, PE, executive search, executive search consultants, executive employment agency, Private Equity International, Magazine, Head of Talent, CHRO, Todd Wyles

Be Prepared

Posted by Morgan Samuels on Fri, Feb 22, 2013

It’s common advice that the key to nailing an interview for a job you want is preparation.  But what about an interview for a job you don’t necessarily want?

“Even if you’re not interested -- prepare,” said Bert Hensley, Chairman and CEO of Morgan Samuels, a leading human capital consulting firm with a focus on retained executive search.  That is because there may be an upcoming opening that is more appealing.  “If you get good feedback from a client, then search firms will think of you again.  You have an audience beyond who’s in the room.”

Search firms place candidates in two broad categories: active and passive.  Active candidates are actively seeking new employment, while passive candidates are generally happy in their current roles.

“Passive candidates sometimes don’t prepare like they should.  There’s a perception among executives that they benefit from being coy or playing hard to get in the interview process,” Mr. Hensley said.  “In my experience, that’s not the case.”

“Go in prepared, or you’re better off not doing it,” he said.

Article Quote

-Know Your Numbers.  Be able to quantify your own performance, but also understand the performance of the company.  If the company is public, read their annual reports online.

-Know Their Story, and Yours.  Be able to describe your career as a narrative and a journey.  How did you get where you are? What have you learned?  Also know company’s story.  Know its history and read through recent press releases to learn recent developments.  Research the professional background of the interviewer.

-Know the Industry.  Research what trends are impacting the company, both positively and negatively.

-Ask Pointed Questions.  Why is the position available?  What are their expectations?  What roadblocks would you face?  Are there opportunities for growth for someone in this position?  Both parties need to understand whether the placement is a good fit or it won’t last long.

Topics: morgan samuels, human capital consultants, executive search firms, retained search firms

Why Should I Take an Executive Recruiter's Call?

Posted by Morgan Samuels on Tue, Sep 4, 2012

Lynn Wu, a Principal in the Los Angeles office of Morgan Samuels, a leading human-capital consulting and retained executive search firm, reveals her valuable insights regarding executive search.  Lynn has over a decade of recruiting experience, and a technical background—co-leading the Engineering and Construction search practice at Morgan Samuels.

When you are happy with your current job, you might feel reluctant to take an executive recruiter’s call—but you shouldn’t be.  Recruiters are incredible assets to professionals.  In fact, executive recruiters provide potential candidates with tangible benefits that go far beyond the actual job role being discussed during a recruiting call.  So if you are a professional who is not actively looking, why should you take a call from an executive search firm?

  1. It’s the Best Time to Consider Opportunities.  The time to consider new opportunities is not when you are desperate for a job.  As Jerry Land points out in his article, “Why a Passive Candidate Should Take a Recruiter’s Call,” “the worst time to go to the grocery store is when you’re hungry.  You’re more likely to buy food that you know is not in your best long-term interests.”  Instead, as a professional, you should evaluate your career opportunities when you have been doing well in your current organization.  It is at this time that you are the most marketable, and an outside opportunity may provide you the opportunity to leverage your current success for a career-defining position that will take your career to the next level.  Being happy in your current role allows you to evaluate opportunities objectively.  The pressure is off.  If the opportunity you are evaluating is not an attractive next step for you, you don’t need to move forward.
  2. It’s a Great Networking Opportunity.  Networking at the executive level is such a worthwhile process, and is vital for future career success.  When a professional takes a call from an elite executive search firm like Morgan Samuels and goes through the recruiting process with us, we take the time to interview the candidate and to understand what’s truly important to you.  Even if you aren’t the right fit for the current role being discussed, you may be the perfect fit for a future search.  In addition, as you learn more about the opportunity through interviewing with the client, that also represents a valuable networking opportunity with a senior executive at another firm.  In the Engineering & Construction industry, it is not uncommon to see joint ventures and other partnerships come out of what was initially an interview.  In other cases, a candidate might be considered for a different opportunity within the same organization.  Even if you decide that the position isn’t the right fit for you or the client moves forward with another candidate instead, it is still time well spent to have met top executives in your industry.
  3. It’s the Perfect Time to Pay It Forward and Provide a Referral.  Even if you are satisfied in your current position, you should still pick up the phone when a recruiter calls.  Recruiters are always sincerely appreciative of referrals.  The people being referred will also be grateful, as well.  It’s fostering mutually beneficial business relationships, and well… it’s just good karma.
  4. Recruiters Are Subject Matter Experts.  Executive recruiters are excellent resources and subject matter experts about the industry.  Search consultants have a good understanding of current compensation rates, market trends, key insights, etc.  They are industry experts in their chosen specialty.  You should take advantage of this fact.  So, even if you aren’t actively seeking a new position, perhaps taking the call from that recruiter will provide you with important information on growing business trends in your area of specialty.  Recruiters are valuable contacts to have and also can provide valuable insights as to how you can help further your career.
  5. In This Economy, It’s Important to Know Recruiters.  While the economy can be said to be improving somewhat, it is not what it used to be.  Now more than ever, it is more important for a professional to be on a first-name basis with a competent and knowledgeable executive recruiter.  You should always be building your network.  Indeed, you should know and use recruiters before you have to use them.  Morgan Samuels keeps in touch with our candidates over decades and we truly value the long-term relationships we’re able to establish and maintain with our candidates over the years.

Lynn Wu's Quote

Final Words of Advice: When returning an executive recruiter’s call, it is important to:

  1. Return the recruiter’s call promptly.
  2. Be upfront with the recruiter about your capabilities, credentials, and current compensation package.
  3. Be open to sending your resume to the recruiter for consideration for future opportunities even if the role being discussed is not a fit.  Having a resume on file enables you to be more quickly considered for new searches that launch in the future, since recruiters will check their internal database and networks first when a new search launches.
  4. Be open-minded to exploring an opportunity even if the location is not ideal.  There are so few senior-level positions the higher up you go in your career, that to take your career to the next level, it is important to be flexible when it comes to location.
  5. Keep in mind that even if you go through the recruiting and interviewing process and do not end up taking the position, that going through the process in and of itself is valuable, both from the standpoint of deepening the relationship with the executive search firm, as well as networking with the client company.

Topics: executive recruiters, morgan samuels, human capital consultants, retained search firms

Quirky Work Perks - Fox News Highlights Morgan Samuels Recharge Room and Interviews Cathy Kim Walker, Principal

Posted by Morgan Samuels on Wed, Apr 4, 2012

Fox News recently highlighted Morgan Samuels, a leading national human capital consulting firm with a focus on retained executive search, as a company offering unique benefits showing employees in our Recharge Room playing Wii as a place to refresh for a few minutes during the work day.

Cathy Kim Walker, a Principal at the executive search firm, offered her human capital expertise by highlighting the benefits of keeping employees engaged by providing perks expanding past the traditional health and financial benefits. Other unique perks companies are offering include: pet friendly office environments, health clubs, half-day Fridays, and cafeterias stocked with organic foods.

Watch the video here

Topics: human capital consultants, retained search firms, executive search

Retained Search Firms versus Contingency Firms

Posted by Morgan Samuels on Thu, Aug 18, 2011

It can be difficult for a hiring company to decide whether the services offered by executive search firms are necessary.  However, with thousands of potential candidates competing for senior-level opportunities, executive search firms can be valuable partners in helping companies identify and attract top talent.  Robby Smith, an Associate Consultant at Morgan Samuels, is one of the Executive Recruiters for the company.  Ms. Smith has experience working on executive searches with both retained and contingency firms.  Understanding the differences between Retained Search firms and Contingency firms is the first step to understanding their value and the best fit for your company’s needs.

“Retained executive search firms partner with the hiring company to really understand the strategic needs of the business and how the role will contribute to the future of the company.  They seek out the most qualified talent that matches the specific needs for a particular role,” said Smith.  Retained executive search firms are more likely to reach out into the market to recruit “passive candidates,” executives who are not actively looking for a new opportunity, but may be a strong fit for the role.  Smith continued, “Contingency firms are more likely to rely on their database.  They are likely to have a large pool of candidates in their database to shop around to several companies who have a broader and more open criteria or need.”

Contingency and retained search firms also have different business models.  “Retained search firms are paid a retainer to source the best possible talent.  They are typically the only firm engaged to fill the role and are paid for their services at the start.  Contingency firms, on the other hand, are only paid after upon placement and may be competing with several other firms in the market.” Retained Search firms and contingency firms also differ in terms of the advantages they provide.

“The advantage of retained search is that by partnering with the firm, the company has a greater chance of finding the best candidate in the market, who possesses the specific requirements for the role,” said Smith.  “The level of the talent and the loyalty of the candidate significantly increase when they are paired with a search firm that tries to match stated requirements, like educational background and work experience, with candidates in an existing database.”

The way that candidates are found also varies between retained search firms and contingency firms.  According to Smith, in most cases with contingency firms, the candidates approach the firm, especially if it is a reputable agency.  Retained search firms really seek out the best specific talent in the market.  They reach out to candidates with specific skills and backgrounds per the client’s request.

The use of Executive Recruiters through both retained search firms and contingency firms can benefit any company.  Whether searching for senior-level executive placements or mid-level executive placements, Executive Recruiters can provide value.

‘For higher level placements, including C-level, it is beneficial to use a retained search firm, because there tends to be a very small selection of candidates who possess the specific skills and experience the client is looking for,” said Smith.  “Whereas contingency firms are more appropriate when the needs are not as specific and there is a large pool of qualified candidates in the market.” Smith believes that both types of executive search firms are beneficial and can serve as extensions of the client’s Human Resources department.  Both types of firms provide the most value when they are viewed as partners to the HR department, working together hip to find the best possible talent, based on a company’s needs and the available talent in the market.

For more information on retained search firms, how they work, and how executive recruiters can add value to your hiring process, contact Morgan Samuels, one of the top executive search firms in the industry.

Topics: executive recruiters, retained search firms, top executive search firms