As 2019 comes to a close it’s worth reflecting on the trends and patterns we saw emerging in Executive Search during the course of the year. In earlier blogs this year we reported on some of the trends that large organisations expect to see and you may have a bit of fun comparing our view of what actually happened against those predicted trends.
1. In a highly competitive market, pricing held up particularly well. While rates are a little short of some of the higher levels of recent years, margin has not been under the same pressure as in the general recruitment market. We believe the reasons for this are pretty simple. Organisations value experienced consultants who can manage a complex long-term process (where necessary) to find and engage with the best talent at C-Suite level and in boardrooms.
2. True Executive Search continues to be an international pursuit. We have seen the relocation of Japanese executives living in Australia back to Tokyo for an American client, we have worked for American clients placing executives and their Australian subsidiaries, we have fulfilled briefs for Australian clients placing executives in the USA but perhaps the most interesting international trend that we have seen is executives “going home”.
It may be a return to traditional values but as their children move through both the secondary school and tertiary education thresholds, executive families are making decisions about whether they wish to return home or whether they wish to continue working as expatriates. Certainly in Australia we have seen senior executives returning home from the Netherlands, Canada, China, the UAE and Saudi Arabia.
3. The ability to connect globally in Executive Search has never been more important. While we have seen substantial advances in the way technology can be used to source and engage with high-calibre talent, access to personal relationships continues to be important market by market.
4. Despite the attention that executive remuneration receives in the Australian press, largely influenced by a very small number of multi-million dollar packages and some of the largest public companies, Australian executives in the C-Suite are not paid as highly as in the jobs they are returning from in the USA and Europe in particular.
5. The Australian banking industry appears to continue to pay some of the highest salaries for senior functional executives (marketing, human resources, corporate social responsibility).
6. C-Suite executives have begun to understand that sales is a profession and they have progressively been prepared to pay significantly higher base salaries for well-qualified and high performing sales people and sales management. CEOs seem to be driving the sales side of their business down one of two remuneration paths. The first is in providing a greater focus on the right values and behaviours to drive success in tandem with above market base salaries with more modest incentives while the other path has tended to bring base salaries up to competitive levels while continuing to reward high performance with incentive pay. There is a gradual executive acceptance that sales is a profession, a vital one at that, which means that base salaries for business development managers and/or senior account managers tend to range between $100,000 and $170,000 per annum. That is where the high talent sweet spot currently exists.
7. While executive stress is still a concern in many organisations, a new breed of senior executives is really embracing the flexibility and work life balance that technology can bring.
We can almost imagine the archetypal senior executive in the 2020s. She or he may work from a fully functional Home Office with state-of-the-art web-based videoconferencing and communication facilities, improve their own productivity with a collection of resources offshore and contained in synched desktop and mobile productivity apps. They will be proficient in automating many of the basic processes, are probably using Dragon or other voice recognition software to do the majority of their writing, will travel extensively holding Uber, Lyft and Ola accounts and will forego hotel loyalty programs to stay in the best properties the corporate travel policy allows while taking advantage of services such as Trivago.
They believe that if the company wants their soul that has to be on their terms.
We look forward to what 2020 will bring.