Boutique search firms switch strategies to ride wave of recovering market
Some boutique search firms endured a torrid time last year as banks cut back on specialist hiring mandates. But smaller headhunters in major financial centers say business is better in 2021 as they adapt their strategies in a rebounding job market.
“The search business is very much alive and kicking, with hiring across all functions and products in banking. I suspect this will continue through next year,” says Joe Astill, managing partner of New York’s Front Street Search.
Pan Zaixian, founder of Singapore headhunters Pan & Co, says although last year was a tough time for many boutiques, some firms took the opportunity to refocus their business strategies during the downturn. “As smaller companies, we can be nimbler in responding to market changes,” says Pan. “For example, Covid has made remote hiring and interviewing the norm, so it’s less important now to have offices in multiple locations. Boutiques that don’t have a physical global presence are now better able to access international talent,” he says.
“The next year is a lot about consultancy; we have to advise clients on market changes,” says Andrew Pringle, executive director of London-based Circle Square. “The clients that listen and adapt will win. Any client that thinks they can take four weeks to interview will fail to get staff. We also have to spend more time advising clients on how to ‘charm’ candidates – the best people will have multiple offers in this market,” he adds.
Many of the day-to-day fundamentals of successful search haven’t changed much, however. “I’m not adapting my search strategy as the market recovers, and I don’t believe anyone else is either. I continue to use market intelligence, relationships, trust, and referrals to work with people looking to hire, and ensure I access top-quality talent,” says Astill.
If you’re working for a mass-market recruiter, one of the advantages of joining a boutique is that you have more control over your client base, says Pan. “I focus on working with clients I want to work with and who enjoy working with me. In a larger agency, you often have legacy clients that you’re obliged to deal with, and you do some roles just to pay the bills. This takes away the joy,” he adds.
Winning new clients can be a “little harder” as a boutique. “I’ve had at least one HR person say that it’s more difficult to onboard a boutique firm than a larger one, but they couldn’t justify why. And to be honest, if that’s their attitude, there are other firms who appreciate the more accessible, specialist and personal touch of a smaller shop,” says Astill.
HR teams at banks are increasingly “trying to control search processes” (i.e. going through an initial list of candidates before appointing an external recruiter), says Astill. But this has been an ongoing trend over the past few years, not one that was triggered by the pandemic.
“Ultimately, a boutique firm needs good headhunters with good networks in the market because otherwise you can be easily crushed by the competition,” says Pan.