Partnering with an Executive Search Firm

Partnering With an Executive Search Firm

Table of Contents Introduction ...... 3

Three Key Industry Trends - and Why They're Driving the Need for Top Talent ...... 4

Six Hiring Trends That Impact Your Talent Acquisition Success ...... 7

Eight Myths About Executive Search Firms – and Why They’re False ...... 9

Five Factors to Look for in a Recruiting Firm ...... 13

About Sanford Rose Associates Executive Search ...... 16

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Partnering With an Executive Search Firm

Introduction

People all around the globe are increasingly aware of the importance of making healthier dietary choices. The whole food/healthy-living movement, once the passion of a small segment of the consumer population, has gone main stream over the past few years as consumers gravitate toward better-for-you products and services that support overall wellbeing. This is great news for companies like yours in the consumer health products industry. Many of you likely started as a passionate entrepreneur and are evolving from start-up phase to a mature organization; some of you now have private-equity backing or a new corporate parent and must develop more defined internal business processes and procedures.

One of the challenges accompanied by growth is the need to develop stronger talent acquisition strategies to compete in the increasingly competitive food, ingredient and dietary supplement sectors. You've probably been frustrated with the difficulty in finding the right skill set and talent to reach future company goals and objectives. Those might be increasing or improving productivity and efficiency, avoiding legal and regulatory problems, meeting ambitious revenue targets, or amping up your brand personality and company perception. All of these objectives are more readily attainable with the right people on board, yet you're discovering it's harder than you thought to find those people.

The idea of using an executive recruitment firm might seem unnecessary and foreign to you, but it's a strategy that you need to seriously consider as your company grows. And that's why we wrote this e-book. We hope that by reading it, we dispel the myths you may have believed about the executive recruitment industry, help you understand how executive search firms really work, and educate you on how to work with and get the most from partnering with an executive search firm.

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Three Key Industry Trends - and Why They're Driving the Need for Top Talent

Trend #1 - Healthy is hot!

The healthy living consumer market is currently growing at a brisk 5 to 10 percent clip. Here are the main reasons:

 The "Dr. Oz" effect - With a popular TV show, newspaper column, and books, this celebrity physician's efforts to educate the public about healthy living and eating choices is resonating with young and old alike.

 Alarm bells are ringing about obesity statistics, particularly among the U.S. population. It is now ranked as the #2 cause of preventable death; 60 million Americans age 20 years and older are deemed obese.

 As Baby Boomers age, there are more older U.S. residents than ever before and they want to lose weight, stay healthy and avoid the use of prescription drugs where possible. This potent demographic trend is helping to drive the growth of the consumer health products industry.

 The proliferation of grocery store retailer Whole Foods and resulting addition of natural products sections in traditional grocers, drug and convenience continues to drive new consumers into the specialty health food, dietary supplement and natural products sectors.

According to the Centers for Disease Control, more than half of U.S. adults use dietary supplements, which include vitamins, minerals and herbs. Some project that the global dietary supplement/nutraceutical market could reach $250 billion by 2018.

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Partnering With an Executive Search Firm

What does all this mean to your hiring efforts? It’s not hard to understand. Because your industry is growing rapidly and needs more people to meet the demands of this expanding market, it’s becoming harder to find the right people as companies compete for top talent.

Trend #2 - Big corporations are moving into the natural products sector

Growth in the natural products market hasn't escaped the notice of the large corporate players in the food and consumer living industry. Mergers and acquisitions have been strong, and corporations like General Mills, Post Holdings, and Proctor & Gamble are buying up smaller natural living/organic firms and embracing the healthy living segment.

This is causing increased hiring as these large companies enter the, functional food & beverage, organic, gluten free, non GMO, or vitamin supplement (VMS) segments. And as you no doubt realize, these corporations can offer attractive salary, benefit packages and career growth opportunities to top talent; if you’re a smaller organization, your recruitment job is now harder.

Trend #3 - The market is becoming more regulated

The FDA is taking a much more active role in dietary supplements oversight, due in part to product recalls in this sector:

 New Dietary Ingredient (NDI) marketing is a big focus of the FDA. Draft regulations are still under review and attempts are being made to soften the impact on companies in this industry; yet it's increasingly evident that the bottom line will be more scrutiny by the federal government.

 Good manufacturing practices (GMP) are also getting a closer look and FDA inspections are becoming more commonplace. Manufacturers who aren’t compling with cGMPs will be forced to change or close their doors.

Bottom line - you are in a battle for the best hires because: 5 | P a g e

Partnering With an Executive Search Firm

 A growing industry means greater competition for top management and executive talent;

 Large Consumer Product Goods (CPG) corporations are moving in and know how to attract and pay for key employees (hint – they use executive search firms);

 Increasing governmental scrutiny demands strong regulatory, quality and operations talent so you stay on top of FDA regulatory and legal issues.

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Six Hiring Trends That Impact Your Talent Acquisition Success

Clearly, hiring the best people is more critical than ever if you want to reach your company goals. Now, let’s briefly review what’s going on in hiring and employment. These six trends make talent acquisition more challenging than it’s been in many years:

1. Talent is becoming scarcer. Baby boomers are retiring and there are fewer U.S. graduates with technical degrees; this is increasingly driving high-tech jobs and top technical talent overseas. Given the increasing governmental regulations and oversight in your market, you are finding the need to upgrade your employee’s skill and knowledge base. You or your company must become very good at competitive recruitment and attracting stronger talent to your organization.

2. Talent acquisition is harder. Both the employed and unemployed have more opportunities to evaluate and receive multiple offers. Delay hiring decisions and you likely lose out on talent to more aggressive employers (or those who can make faster decisions). As we mentioned earlier, a key trend is the movement of big CPG companies into this space, meaning they now compete for top talent. Thus, you have to work harder and smarter to find the best person for your organization, or settle for a second or third choice.

3. Retention is becoming more challenging. As top tier employees become scarce, companies will directly recruit from competitors. If key executives have been overburdened or overworked due to the difficult global economic situation, layoffs, or downsizing, then they are more apt to accept a better offer elsewhere.

4. Relocating is less common. It should come as no surprise to you that candidates are less likely to relocate than they did five, ten, or fifteen years ago. Why? Because it's much harder to sell a home in this weak housing market. In addition, children seem

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to have a stronger influence in a family’s willingness to relocate the ten or fifteen years ago.

5. Hiring has increased across all functions. Increases in hiring demand for sales, business development, marketing (especially social media), as well as research and development regulatory, and quality are being seen across companies in the functional food, beverage, ingredient and dietary supplement sectors. Strong industry growth absolutely brings benefits to your company, but it makes recruitment and talent acquisition a high priority. Are you dedicating enough attention to acquiring top talent?

6. Globally experienced executives are in high demand. Employees with international experience and multi-language in high demand in all industry sectors. As dietary supplement and food/nutritional ingredient companies look to expand and grow into internationally, they will need to employ men and women who have that experience.

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Eight Myths About Executive Search Firms – and Why They’re False

You’ve probably figured out by now that your organization could benefit from the knowledge, expertise and connections of an industry specific executive search firm. But you may not be ready to partner with a recruitment firm because of negative information you’ve heard over the years. So let’s tackle the eight most common myths, debunk them, and explain what can happen to your company if you don’t consider adjusting your recruitment strategy.

 Myth #1 – We can post an opening on multiple job boards and find the same people

that a recruiter would send us.

Executive recruiters don’t just surf the internet, post ads or go to LinkedIn or Craigslist to find key employee talent. They have relationships with thousands of candidates, both active and non-active job seekers, which they develop over years of networking in your specific industry.

It’s a fact that job boards and/or online advertising will not reach the best candidates in the marketplace – only those looking to make a job change. As for LinkedIn – this is not the solution for most job searches. Yes, there are millions of business professionals around the world who post a profile on Linked in, however, a recent survey on social media and recruiting concludes that only 35% of potential job seekers post a profile on LinkedIn. (What about the other 65% of the workforce?) Furthermore, most profiles are incomplete and don’t provide a significant amount of information about a candidate’s relevant background. Relying solely on these resources means you are guaranteed to miss out on top talent!

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 Myth #2 – Our internal staff can find the same talent as an external recruitment

firm.

Au contraire! Recruiters are the experts who know the ins and outs of your industry employment market. As employment specialists, their job is to know where the top talent is and to make sure your company has the opportunity to evaluate these individuals. A good recruiting firm stakes its reputation and integrity on finding someone better than their client could have found themselves.

“In-house human resources, no matter how effective, view the marketplace through an imperfect or misrepresentative prism and tunnel vision is their occupational hazard. Just as physicians are cautioned against treating their own family, so too is it folly for an in-house HR professional to believe he or she has an undistorted and unbiased picture of the employment landscape. They are vulnerable to the pressures of internal politics and cultural dimensions which do not hinder the outsider,” explains a Fordyce Letter article.

 Myth #3 – All you need is a good job description to find the right candidate.

A job description cannot “sell” your position and is not the best way to entice a candidate to seek a job at your organization. In fact, most job descriptions are written to screen candidates OUT – not to entice “A” players to apply for your job opening.

Furthermore, a ‘passive’ candidate (someone who is not actively looking for a new job), won’t even be reading your job description. However, a good recruiter has an extensive network and can help persuade top tier talent to consider your opening. Rely solely on a job description to bring in potential candidates, and you will absolutely miss out on better options that a recruiter can locate for you to consider.

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Partnering With an Executive Search Firm

 Myth #4 –It’s perfectly OK to hire a friend or a friend’s friend; why would I need a

recruiter?

While it can be tempting to be the ‘good guy’ and help out friends who need a job, it’s a terrible strategy for building the best possible workforce. Top talent for your business is generally not the guy that lives down the street or the one your spouse plays tennis with on the weekend. Top talent is generally employed, bringing in customers and revenue, running a department, or managing an operation for another organization. A recruiter with expertise in your industry can help you define the skills your business needs, identity the top candidates and attract the employee that will move your company’s strategy forward.

 Myth #5 – Executive recruiters have a ‘stable’ of candidates ready to plug into any

job opening, so why do they need to conduct a ‘search’?

Every company culture is unique and each role within a company has nuances. Executives who hire understand that people have personalities, skills and experiences that will be better suited for one company culture over another. For example, an employer might be looking for a manager who would excel in a highly entrepreneurial environment need helps weeding out a manager who is better suited to an organization with significant resources and defined processes.

For a typical executive search, the recruiter will develop a list of possible candidates, maybe as many as one hundred people or more. Each will be assessed against the position requirements, experience and the cultural fit with your company. After several telephone calls and outreach emails, the long list is narrowed down to a short list of candidates who will undergo an intensive interviewing process by the search firm. At the end of the process your company will be presented with a slate of 3-4, highly qualified candidates.

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Do you have the time or expertise in your organization to follow this extensive process? Likely the answer is no. A professional recruiter is your ally in finding the best possible candidate for your position.

 Myth #6 – It’s a lousy economy with high unemployment and so I’m sure I can find

top talent myself.

High unemployment numbers do NOT mean that the best candidate for your position is currently unemployed or that he or she will answer a job ad. In addition, should you come across a highly qualified candidate, that person should be hired instead of putting the candidate ‘on hold’ while you look for someone even stronger. ‘B’ and ‘C’ players are easy to find – however, the best candidates – the ‘A’ players – stay employed or find a job quickly.

 Myth #7 – Executive recruiters are too expensive and the ROI is poor.

Think the cost of hiring someone is just the cost of the ad or internet postings? Well, think again. Consider the salary and benefits of any in-house recruiting or human resource staff plus the time of other managers involved in recruiting and interviewing. The time that your employees spend trying to find the right new hire, is time not being spent on activities that generate profits and growth for the company.

Furthermore, what if all that activity results in a bad hire? Experts estimate that the ‘cost’ of a failed hire to the company is at least four times the employee’s annual compensation. Smart executives learned long ago that the fee paid to a recruiter is a shrewd strategic investment. And that’s because the “best” is far different from the “best available.”

 Myth #8 – Paying a retained search firm is no better than working with a

contingency-based firm.

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Let’s define these two types of search firms. Contingency-based firms are paid only if the candidate that they present is hired. They usually deal with lower-level positions. They often present lots of job candidates that are not an ideal match for your needs. A contingent search means that when the recruiter gets bored, frustrated or tired of searching for your ideal employee, he can simply quit because he has ‘no skin in the game.’

Conversely, a retained search firm works with you until the search process has been successfully finished, however long that takes, and however many candidates the firm has to present to you. A retained executive search firm makes your search a priority and follows a proactive recruitment process. In contrast to contingency-based firms, they are likely to be more selective about whom they present to a company, and they usually make more of an effort to match an individual to a particular opening.

Five Factors to Look for in a Recruiting Firm

Hopefully we’ve convinced you by this point to consider the services of an executive recruitment firm.

Here are five factors you should consider as you begin your search:

1. Expertise in your industry

Look for a recruitment firm that knows the ins and outs of the employment market and is tapped into the insider information in your specific industry. While good talent can be drawn from other industries, be careful about contracting with a recruiter who doesn’t have a long track record and connections in the you industry and sector. Ask them to give you a brief summary of what’s going on in your industry, who the key players are, what

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Partnering With an Executive Search Firm opportunities and challenges are emerging, and what hiring trends are significant. In short, test their knowledge of your industry.

2. It’s all about connections

When seeking a recruiter for your position opening, find out how they develop a candidate target list within your industry. Where do they meet these individuals? How do they network? What industry associations and tradeshows do they belong to? Throw out a name in the industry and see if the recruiter knows who this person is, where she works and what her role and reputation is at the company.

3. Global presence

Our world is an interdependent global marketplace and it becomes ‘smaller and flatter’ each day. More and more top talent is coming from overseas; technical skills in particular are strong in many Asian countries. It’s important for you to work with a recruiter that has a strong global reach so they can access all corners of the globe in their search for your ideal hire.

4. Longevity

While length of time in business doesn’t always equate to excellent performance, it’s an important metric for consultants in the executive recruitment industry. The longer a consultant works in an industry niche, the stronger you can expect their network and their knowledge of where and how to find the top talent. A reputable search firm will have significant repeat business from client companies, a good reputation in industry circles and a track record of successful placements.

5. Candidate-company matching process

Finding that one right person for your position isn’t a matter of random luck for a good recruiting firm. Ask about the process that is used to match a candidate’s skill set, 14 | P a g e

Partnering With an Executive Search Firm employment background and management style to your specific position requirements. How many interviews does the firm conduct before presenting a candidate? Do they meet personally or video interview the finalist candidates? When do they call references?

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About Sanford Rose Associates Executive Search

Sanford Rose Associates - Beachwood is part of a global recruitment network providing clients and candidates with top recruiting and executive search results. SRA Beachwood conducts searches for clients in the Dietary Supplement, Nutritional Ingredient and Functional Food/Beverage industry sectors throughout North America. We are committed to "finding people who make a difference®" within organizations by finding individuals who perform, exceed expectations, and assist the organization achieve its strategic goals.

In business since 1959, Sanford Rose Associates search consultants have partnered with thousands of clients and filled over 100,000 positions around the globe. Speaking of global, our company serves a worldwide roster of client companies from over 65 offices located across North America, Europe and Asia. We can and do find top hidden talent worldwide.

http://www.srexecutivesearch.com Call us at (440) 893-9408; or email [email protected].

2000 Auburn Drive, Suite 200 Beachwood, Ohio 4122

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