Why Good Headhunters Donít Die

Author: Frank Mulligan

With their market collapsing around their ears, headhunters are currently in the process of running off the tops of high cliffs, or impaling themselves on readily available sharp objects.

Their death is as inevitable as taxes. Or so we are led to believe.

The logic is impeccable. The market for recruiting services is currently in shreds, so this is surely the end of the line for some headhunters. This is a reasonable assumption to a large extent, but there is also light at the end of the tunnel.

(Note: If there wasnít any hope none of the big headhunting players would ever have been able to build up and maintain their business over a long period of ups and downs in the world economy.)

It is true that I have seen a number of small headhunting operations go into receivership in the last few months in China, but at the same time I have not seen any big headhunting player, in any part of the world, suffer the same fate. Not yet anyway.

Something must be working in their favor.

Itís Cold But Ö
Many of the worldís leading companies are currently on a hiring and travel freeze. This is happening outside China in a big way, and inside China at a lower, but still significant, level. No one is safe.

This means no hiring until the freeze is over, even to the extent, in some cases, of not replacing people who leave the company of their own accord. If all goes according to plan company payrolls will be slowly reduced, and exactly the people the company want to leave actually leave.

But the law-of-unintended-consequences kicks in here, as a result of the fact that companies are being forced to look much more closely at the productivity of their existing staff.

Those who used to make the grade for performance are now under the microscope. Few people in China were paying attention to performance evaluations because the Modus Operandi was to get bums on seats.

One group that is not always paying attention here is HR. They assume that they are the ones doing the watching, not the ones being watched.

But in the last few months the ground has shifted. HR departments in the Headquarter offices of multi-national companies are under tremendous pressure to provide useful information to their CEOs and senior management. They have been inundated with requests for insight about their operations in Guatamala, Brazil, Korea and China. They expect to be able to get this information from their local HR staff, and in many countries they are getting what they want.

But this is the first time that HR in China has ever seen a downturn. Local HR are waiting patiently for the Chinese government to fix the problems with the Shanghai stock exchange, and take effective measures to push housing prices back up. The urgency of the requests-for-information coming from the MNC HQ is lost on them, and the frustration at the HQ level is boiling over.

Disappointed by the lack of any real insight from their own HR staff, worldwide HR Directors are making a private call to the headhunter on their companyís Approved Vendor List (AVL).

Fluid
Meanwhile, staff in China are not all holding on to their jobs with the tenacity of a border terrier, despite yesterdayís email. There is still fluidity in the market, with strong candidates leaving for greener pastures.

Companies who look more closely at staff productivity have to solve problems that they have not been willing to face before. One of these problems is how to get rid of non-performers.

The end result is that everyone is still chasing the same people, except now the outcome is critical because that chase is related to survival, not market share. The headhunterís remains critical to his customerís business success. Good headhunterís survive, and bad ones fade away.

Exit stage left Ö