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What’s a Nonprofit Executive Search Firm and Why Nonprofits Should Hire Them Over Standard Headhunters?
Hiring the right people is an organizations’ most important asset. For this reason, nonprofits need to be rigorous in determining highly qualified and competent talents in suitable positions. Given the potential of the right person in senior leadership roles can accomplish, organizations need to invest not only time but also the necessary resources in attracting and assimilating those leaders.
Most of the time, boards try to do the hiring process themselves, not realizing how much time a search takes, and how much effort it requires until it is too late. C-level or top-level positions is the most important position in the organization and investing time to do it effectively and efficiently will save everyone’s time and frustration later on.
Some nonprofit organizations initially do the search themselves focusing on hiring someone with specific expertise in mind without considering other factors at play. For example, a small NGO prefers to hire an Executive Director (ED) who is experienced in advocacy. Typically, they will choose a CEO or a Managing Director with proven experience in advocating organizational mandate/s. Although that is important, some organizations fail to compare and assess how the new ED’s background, expertise, and experience fit into the organization’s structure, culture, and direction. Because of that, the newly hired ED won’t last long in his or her position, which puts crucial programs on a halt.
Some nonprofit board members may have hiring experience and believe that they can oversee a search. They will soon realize that the amount of time required (approximately 100-150 hours) to hire a top-tier leader is way different from a typical hire.
Realistically, nonprofit boards don’t have the time nor the expertise to do the search themselves. Most of the time, with the help of an executive search firm, there’s a structured process in place that resulted in finding the best candidate and convincing them to accept the position.
Partnering with a third-party search firm to hire the next executive director or other C-level positions allows the board to focus on core businesses, and the selection process, rather than getting stuck with the details of the search.
Before we move further, what is an executive search?
According to Bridgespan Group, a nonprofit advisor and resource for mission-driven organizations and philanthropists, “An executive search firm comprises professional recruiters who have training and expertise in a range of recruiting activities, including identifying the core responsibilities and qualifications needed for a given role, writing job descriptions, developing a candidate pool, assessing how candidates’ skills, experience, and personalities match up against the open position, conducting reference checks, and providing advice on the negotiation process between the organization and the final candidate.”
Now, there are many search firms locally, regionally, and globally, but only a handful are dedicated to working solely with nonprofit organizations. CARRHURE Consulting, drawing from its decade-long experience conducting executive searches for nonprofits, can distinguish the difference between executive-level searches for nonprofit organizations versus for-profit organizations:
- Typically retained to do a partial or complete search while serving as the organization’s trusted partner
- Works with search consultants with direct, senior-level experience in the nonprofit field and taps its strong professional networks to actively recruit top talents
- Fully understands the nonprofit sector and the distinct competencies and skillset required for its leadership.
- Recognizes the governance structure, which is crucial in evaluating the candidate’s ability to work with the board accordingly, including the nuances of internal and external factors that affect nonprofits during transitions.
- Successfully deals with committee members’ varying views and navigate added, and usually unexpected, complexities
- Customizes the search process according to the organization’s needs and provides value-added advice for the organization’s and the newly hired talent’s long-term success.
Moreover, search consultants have been Executive Directors or CEOs themselves, so they understand the demands of the position. Through clear, transparent, and constant communication, they can assist the board in crafting reasonable and realistic expectations for their new hire and determine the necessary qualifications for the role. They serve as objective observers paving the way for the board to see beyond potential blind spots.
On the other hand, a standard executive search works primarily with for-profit organizations and has little to no experience working with nonprofits. Since their teams usually comprise of general recruiters (i.e., usually with backgrounds in business or human resources), they’re often not familiar with the intricacies of working with a board and other stakeholders. Some of them rely heavily on a standard database and follow a basic recruitment method in filling a vacancy.
While the cost of retaining an executive search firm may cause a board to hesitate and decide to do the search process on their own, they should seriously consider otherwise. Investing big in finding the right person for the job is better than shelling out a huge amount of money to replace a bad hire. Just take a look at these reports:
- According to the U.S. Department of Labor, the cost of a bad hire can reach up to 30 percent of the employee’s first-year earnings.
- Based on Undercover Recruiter‘s report, bad hires can cost $240,000 in expenses.
- CareerBuilder says 74 percent of companies who made a poor hire lost an average of $14,900 per poor hire.
Furthermore, a placement through an executive search firm stays in the role longer than any other type of recruitment method. Allocating a significant amount of funds upfront to recruit the best talent is proven advantageous to the organization over the long term since he or she will best serve the organization’s mission, vision, and mandate.