About a year or so ago, I attended a meeting on executive search and listened especially closely to several of the speakers at the conference. One of most interesting topics addressed what some pundits are predicting regarding changes in the executive search business model as the labor pool begins to tighten. Typically, a client company/organization hires an outside firm to conduct a search for an open (and sometimes confidential) position. The business model is pretty simple: the client compensates the search firm based on a percentage of the annual salary + bonus of the individual who is successfully placed by the firm. Some agreements are milestone driven, some are performance based, while other firms require a structured payment fee over a specific period of time (I just donâ€™t get this) regardless of the outcome. You’d be amazed at the low completion rates by some of the largest search firms in the world. Amazed!
Moving on… With the shortage of talent in the HCIT market, we already see signs of fewer highly qualified candidates for the available openings. The supply and demand equation is shifting towards the candidate side as the talent pool for some positions is becoming pretty shallow. Weâ€™ve already seen many examples where multiple healthcare organizations in the same location have multiple openings for the exact same positions, creating more pressure on candidate availability. Now what?
Some are predicting that the talent shortage in certain industries (like HCIT) will lead a number of firms to re-evaluate the way they do business. Some firms are already moving to a sports agent relationship model where the firm will represent a candidate before they ever â€œbecome availableâ€ – sort of like forbidden fruit. Top shelf talent will be confidentially shopped to key organizations that may not even have an opening but choose to hire the person anyway just to build bench strength and ensure that they have access to great talent which may otherwise take too long to find. This is an interesting situation that may materialize â€“ or it may not. If this business model is adopted, these executive talent agents could drive the talent acquisition needs of our industry for many years to come. Itâ€™s a model that’s been around for decades and used by professional athletes and entertainers – add CIOâ€™s and other HCIT leadership positions to the mix and now you really have a game changing event!
Iâ€™m not making any predictions here â€“ only sharing thoughts and ideas that many in our industry are talking about. Who, knows – it may never happen. I will, however, offer some advice: you may want to develop a relationship with search professionals who truly know the HCIT market â€“ regardless of whether or not their business model changes.