Archives for posts with tag: capitalism

As some of you may know I work as a headhunter, I work mainly in the senior actuarial market and a lot of what I do focuses on investments.  I do work in other sectors and my team covers pretty much every area of actuarial work, we work senior roles from £100,000 up to well into 7 figure salaries and we have a strong network of contacts across consultancies, asset managers, life businesses, insurance companies and banks.  Why am I telling you this?  Well it’s a little bit of background really as to the nature of the post.  I’ve found myself challenged recently as to what I do, both on social media and in real life.  Thankfully though not by my clients!

Recently I’ve been told I’m barely above bankers in terms of the ethics of my profession, I exist merely to push up ‘fat cat salaries’, I add no value to the business world and I quote ‘humans are not for hunting’.  Well as you might expect, I would like to quibble a little with this!  I think many people either don’t understand or don’t realise what value you can get from a good headhunter, please don’t get me wrong there are some bad ones out there.  I’ve heard all the shocking tales about dodgy recruiters of all levels, for a flavour of that the Kernel magazine did an excellent report on the good the bad and the ugly amongst technology recruiters. 

Firstly let me distinguish between a recruiter and a headhunter, there is a difference and it can be quite large.  A recruiter is someone who works on a contingent basis ie not paid up front on a variety of roles released to them by their clients.  Those same roles may be released at the same time to several other agencies and a good recruiter works fast to find the best candidate on the market, either through their own database or via advertising or occasionally a headhunt.  Don’t get me wrong I’m not disparaging this form of recruitment, until mid way through last year I did it myself.  If you’re say a company like RBS with a need for accountants, marketers, procurement professionals etc this is an easy way of getting talent in the door without having a giant HR function to do it for you.  A headhunter works in a couple of different ways, either a direct introduction where a contact is actively seeking a new role and you know a company who may be interested in their skills or a retained up front payment to search for the best candidate on the market to fill a job.  The method we use is search and we actively speak to every person, actively looking or not, who are able to fill that role.  As you can imagine for some roles that is quite a long list!  Of course for others, when the role is niche it can be significantly shorter.

So is this all a headhunter does?  Do we simply find the best talent for our clients?  In doing so don’t we bump up the salaries of the people we find?  Well yes, in a simplistic way this is true.  For the sake of argument if you hold a CFO position in one insurance company and a similar sized company asks me to headhunt you to work for them then there has to be an incentive to move.  What can the new company offer that the old one can’t?  Yes there can be other factors, the challenge of a failing company is one that some people crave.  Perhaps a better work life balance but realistically at that level I’d doubt it.  Perhaps a greater variety of work?  Possible but realistically your only option is a bit of a cash hike.  So yes in some respects I’m guilty as charged on that one.

So is that all a headhunter does?  It’s certainly all we’re paid to do but do we add value elsewhere?  You bet we do.  Let me give some examples here of why if you are at a senior level in any organisation you should be in reasonably regular touch with a good specialist headhunter.

A headhunter spends his or her entire life on the phone, either speaking to clients or candidates or HR teams.  When you spend that amount of time speaking to people you build strong relationships, or should do, if you’re good!  This makes you become an expert in your field, maybe not in depth (stochastic modelling?  I couldn’t model a coin toss!) but certainly in breadth and in the range of contacts we have we’re unparalleled.  Who else speaks to both your competitors, your colleagues, not to mention your suppliers and potentially your sales targets all in the same week?  If you’re a start up business and you need to meet people, I’m not talking candidates here but contacts, then why aren’t you talking to your headhunter?  I’ve lost count of the amount of people I introduce, I don’t get a fee for it even though it may result in some business happening but it builds my credibility while helping build your business.

As a headhunter I don’t work with that many clients, I can’t or I would have too many ‘hands off’ agreements.  However again this is something that benefits my clients.  Let’s say you’re a large company looking to grow, you might not just want one senior person,  you might need a team, or even an acquisition of a smaller company.  Before you pick up the phone to your friendly corporate finance teams who do you think might know of companies that could be potentially up for sale?  That’s right your headhunter, we’ve probably spoken to the CEO or the CFO, we know the state of their business and we know who is ripe for doing a deal.  On this one, yes I’d charge for making the introduction but a tiny percentage of the value this brings to your company. 

You need some market information, what your competitors are doing?  Speak to your retained headhunter, we’ve after all spoken to candidates who are working for your major competitors.  I’m not suggesting for a minute we’d do anything underhand but in broad brush stroke terms I’m happy to talk to clients about companies I don’t work with.  Salary surveys? No problem, free of charge.  Why get your HR teams to do something most headhunters will provide gratis?

If you have fallen foul of this awful economy and you’ve been made redundant who’s the first person you should pick up the phone to?  Your headhunter.  We might not be working on anything right now that fits but if you have an in demand skill and you need introducing to companies where you have no contacts of your own, we’re ideally placed to help.  Even if it comes to nothing an introductory chat still increases your own network of people and one day that chat might lead somewhere else.  The pool of talented good people is small and everyone wants the same people, make sure you’re well networked and make sure you have a good relationship with a headhunter.  Who knows what benefits it might bring?

In short, yes I’m here to make money but I’m also a repository of information, sometimes useless but sometimes invalueable.  I want, in fact no I need my clients to succeed so anything I can help to do along the way I will.  In the long run, what helps my clients helps me and what helps us all generates more money and benefits the wider economy.

So this morning I am going to write about Bob Diamond and the hardly unexpected news that this morning he resigned.  Personally I think he should have waited, there are clearly a lot more banks left embroiled in this scandal and to make a scapegoat of one man when clearly the whole culture of banking is probably the issue is wrong.  Don’t get me wrong, I’m well aware he was running Bar-Cap at the time and that the buck stops with him, I’m also aware of ongoing reputational damage to Barclays and that needed stemming also.  However if we are to demand the same of all the banks that are in the same boat how on earth will that work?  We’ll have most of our major banks leaderless and without direction, a desperate rush to tempt away the best candidates to take over, which will naturally push up remuneration (god forbid!) and quite frankly a lot of people taking someone second best because there’s nobody left. 

Surely a more sensible approach is firstly to actually investigate fully each bank, what went wrong and how then devise a solution to deal with it.  The biggest stumbling block to this that I can see is that it appears the Libor fixing was an almost open secret with many people complicit, which does make it rather difficult to apportion blame.  However on saying that since the banking crisis started there hasn’t been a single prosecution as yet, the general public see ordinary people being prosecuted for stealing bottles of mineral water and yet fraud on a massive scale goes unpunished.  In Britain and in London specifically financial services accounts for a huge amount of our wealth and the last thing we want to do is to kill the metaphorical golden goose, however we do need to clean things up in a way that the general public will understand.  The average chap in the street mostly had no idea what Libor even was until last week let alone its impact on financial products, it’s unlikely many beyond the chattering classes would follow any kind of trial but something must be done to show there is justice and that bankers can’t ride roughshod over everyone else in pursuit of profit. 

Having said all that though I am worried in general about the attitude to wealth and ambition in this country, there seems to be a constant bash the rich theme to almost any political discussion irrespective of which forum it happens to be on.  There seems to be a common misconception that if only we could take all the money off the wealthy then there would be no deficit, puppies would gambol in the street and to paraphrase Voltaire all would be for the best in the best of all possible worlds.  The problem is though that you can’t fix all ills this way, the way to bring people out of poverty and to make the poor better off isn’t by stopping people being wealthy.  It’s the same argument about doing away with public schools, standards across the board won’t rise simply because you stop the elite few from having the best you need to raise standards by doing better at the bottom.  The poor need help to become less poor and throwing money at them that’s been taken off the rich won’t cut the mustard.  Let’s start to celebrate achievement and give people something to aim for.  Why hasn’t Britain had a world-beating company like an Apple or a Facebook or a Microsoft recently?  Where are our Bill Gates or Steve Jobs?  We need to encourage people to get out there, have great ideas, help themselves and by extension others and celebrate achievement when we see it rather than deride them for being selfish capitalists only in it for themselves.  Let’s stop with the negativity, stop thinking we can simply tax the better off into oblivion, it’s too easy for them to up and leave anyway as France is starting to find out.  Let’s clean up the mess that is our banks then be proud of what we have, a world renowned city with massive opportunities, the greatest financial services centre in the world and hopefully a country that’s open for business and entrepreneur friendly!