To understand both real and perceived value of executive search, you have to trace brand name CEO turnover situations, such as what recently took place at Yahoo. Their "search firm of record," if such a title still holds sway, was Heidrick & Struggles who assisted the board in the former selection of Carol Bartz who was fired and then replaced by Scott Thompson who also was recently fired (ok, officially resigned.) What role executive search played is left largely to perception, which tends to be shaped by media, such as the Wall Street Journal, and in the case of Yahoo, its digital cousin, All Things Digital. The perception game is where legends have historically been made. The makers comprise a short list: Tom Neff at Spencer Stuart and Gerry Roche at Heidrick & Struggles. There have been other big figures but these two tended to garner the most attention.
The game, however, has changed. Neff and Roche are now public vestiges to a bygone era. The challenge is how to re-define as these dynamics move away from old boy networks and smoke filled rooms on the Upper East Side to a more transparent, democratic approach that de-emphasizes going outside to find leaders. The exceptions tend to be the big companies who screw up governance or succession so badly that they have to use brand name firms to protect their own reputations. Insert Spencer Stuart, which was recently selected by Best Buy to right their sinking ship. The truth that no one at the "top" wants to acknowledge is that risk has been at all-time low during the most recent economic correction, and it remains a large obstacle to the change we can believe in.
Except for those who have already taken the risk and now thumb their noses at big search firms. Insert your own names here: Stephen Miles who used to be with Heidrick & Struggles in their leadership consulting business and now operates independently, Peter Crist who used to be with Korn Ferry prior to starting his own Chicago-based firm, Kelvin Thompson who now runs the global boutique Montarosa after a series of high-level roles with Boyden Search and Heidrick, respectively; and a personal favorite, Russell Reynolds, who still operates independently while his own namesake firm, Russell Reynolds & Associates, wagers on somehow someway. Matthew Wright, please phone home!
Where does all this lead? Who knows; fewer care. The new rules of the game are still sorting themselves out. One trend is clear. If you're an established entity who has to defend values at every turn, you're constantly under attack while being held to a standard that isn't shared by everyone else. Case in point: Recent public flapping by CT Partners, formerly Christian & Timbers, which has recently taken public shots at Heidrick & Struggles who used to employ CT Partners CEO, Brian Sullivan following the purchase of Sullivan's former financial services boutique.
If this summary is starting to sound like a bunch of cats fighting in a broken down barn, then you get the picture necessary to make your own conclusion. Due respect to the industry's only association, AESC, no metrics are required to evaluate this so called business, which has historically been plagued by bought out analysts and other charlatans with zero credibility. This lack of accountability may ultimately be the industry's undoing. In the meantime, anyone need a new CEO for the long awaited upturn?
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