Matt Schwartz, CEO and Founder of MJS Executive Search, discusses how you can win over passive candidates, why your employer brand is important and more on this episode of The Best Team Wins Podcast.

 

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Connect with Matt on Twitter and Linkedin.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transcripts:

 

Adam Robinson:	Welcome to The Best Team Wins Podcast where we feature entrepreneurs whose exceptional approach to the people side of their business has led to incredible results. My name is Adam Robinson, and for the next 25 minutes, I’ll be your host as we explore how to build your business through better hiring. Today on the program, we’re taking a little bit of a different tack here. We’ve got Matt Schwartz, the founder and CEO of MJS Executive Search based in Scarsdale, New York. Matt is an expert on helping companies find and hire the right people. He is taking a macro level view of this with us here today. Listen up. He sees the market at the top of the food chain here, and I am so excited to have him here with us on the program. Matt, welcome.
Matt Schwartz:	Hi Adam. Thanks for having me on.
Adam Robinson:	Yeah, this is going to be fun. Before we jump into your approach, give us 30 seconds on what your firm does, for those that may not understand how executive or retained search functions.
Matt Schwartz:	Absolutely. We are a 15-year-old retained search firm. Retained means that companies actually hire us on exclusive and actually pay us upfront for our services. The reason why they do that is because we have specific functional expertise in areas that they need help with or don’t have that domain knowledge internally. I started this firm at the beginning of 2003 right after the first dot-com boom and bust. Companies had just spent millions of dollars building brands that disappeared overnight, and we realized that we needed to create a positioning that was going to be attractive if they were going to be hiring people.
	For us, that started out as what we called measurable marketing. People were willing to spend if they could see an ROI on their investment. Over the last 15 years, you can imagine that has evolved dramatically into a lot more digital channels. We moved from measurable marketing to digital marketing transformation, and then one of our clients said, “Wow, you’re really involved in business re-imagination.” We focus on what we call transformational talent, which is often roles that have never existed before within our client’s business, skill sets that are not organic to the company or the industry, or roles that need a significant upgrade due to an infusion of digital marketing or technology.
Adam Robinson:	If listeners want to learn more about what you’re doing, what’s a good way for them to do that?
Matt Schwartz:	Yes. Our website is mjsearch.com.
Adam Robinson:	Great. All right. Let’s dive in here. Typically, what I’m doing is asking CEOs to take us all the way back to that first hire. I understand you’ve got somebody that or a couple of individuals that are helping you on these projects. Talk about how your team functions to help your customers find the right people, as that’ll give us some good context for the next 20 minutes.
Matt Schwartz:	Absolutely. For us, like I said, a lot of times the roles that we’re working on have never existed before within our client’s business. Once we win the opportunity and they feel comfortable that we’re the right firm to jump off the cliff with, to go down this very unique road to find these individuals, we spend a lot of time with that client doing a deep dive to make sure that we could be a true extension of their organization, not only understanding the company and their culture, but also asking a lot of questions around the job in terms of what this person’s going to be responsible for, what the organizational structure looks like, what resources do they have access to, budgets, not only reporting relationships but how involved will other senior leadership be and who are the stakeholders across the organization.
	With that, during that time, it’s up to us as a retained search firm to be able to really manage the client’s expectation, because those are the times where the clients often want everything and the kitchen sink, but they hire us not only for our ability to bring people to the table, but to have insights on the market and help adjust their expectations to figure out what is going to be realistic for them to find a person that can do the job that they think they want this person to do, or what the realistic job is based on the market and the skill sets available.
Adam Robinson:	Having the benefit of seeing the market at the macro level, I know you guys are nationwide in your search.
Matt Schwartz:	Yes.
Adam Robinson:	Give us your take. As we record this January of 2018, it is the tightest labor market we’ve seen in decades. What are you seeing, and how are you coaching your clients to approach these critical hires in a labor market that is just so tough to navigate?
Matt Schwartz:	I think the best way to start is to think about, what are top-level candidates looking for in today’s market? When I talk about top-level candidates or some of these people in the most high demand, I’m talking about chief digital officers, artificial intelligence, machine learning folks, people who understand the nuances of today’s media world, general innovation. These areas are … or cybersecurity. These are just hot, hot, hot. If you think about what the candidates are looking for, believe it or not the number one thing our candidates tell us is that they are looking for a challenge. They’re looking for an opportunity to really transform and make a difference in a business. That’s actually the number one thing that attracts them. Obviously, right after the challenge comes competitive pay.
	A lot of the world-leading tech companies, like the Facebooks, the Googles, the Amazons of the world, they are in a massive land grab, and they cannot hire people fast enough. Even though their cash compensation may not be as competitive as a lot of other companies, their ability to offer up significant golden handcuffs with restricted stock or options over a three to five-year period makes it super difficult for corporate America to pull these people away, because it often doesn’t mean they’re giving them a 10 to 20% increase. It means that they may have to increase their comp by 50% based on the amount of money they need to make up over a three to five-year period if that candidate stayed where they were.
Adam Robinson:	All right. We’re hearing certainly a challenge, fair pay, ability to make an impact. How are these passive job seekers … They may be open to work, but they’re not out there with their resume posted. How can companies today who want to do some of this themselves access this kind of talent?
Matt Schwartz:	The candidates that these clients want are the ones that are not actively looking. They’re the ones that are just rock stars, just crushing it at their current companies, but are open … Everybody’s open to listening. How do you get people’s attention, and how do you get them to say, “Huh, if that is as great as it sounds, maybe I should throw my hat in the ring”? That’s where an outstanding internal recruiting staff, which most of our clients have, or a third-party search firm like mine can really make a difference. What that comes down to is being able to communicate, what is that employer brand? What do they stand for? What is the story of the company and the job that’s going to give people a deeper understanding of the impact they could make? A lot of times, people have a perception of an organization, but they don’t know what the real reality is.
	That’s one thing that I think we do exceptionally well is being able to tell that story of that transformation, that change, a company’s investment and how important technology is, but also how supportive the senior leadership is. These are the kinds of things that get people’s attention to say, “Huh, I really can potentially consider this and take the leap.” Then lastly, who that person will be working with is also a key issue. People go to work for great companies and great company brands, but if they don’t like their boss, it’s not going to work out. Hopefully that boss is a visionary, is a great leader, has the ability to help that person navigate and be successful in the organization. The more information we have on that, or the internal recruiting staff has on that and can tell that story, the more excited and interested a potential candidate’s going to get.
Adam Robinson:	Let me take this from the other side of the ledger. As listeners can sit there, think about their best people, and ask the question, “Am I doing everything I can do to make sure I’m delivering on my promise to them so they’re not poached,” what can companies do, what can leaders do, listening now, to check to see if they’re doing their best to keep the team that they’ve built? Why do people leave?
Matt Schwartz:	Yeah. People are looking for bigger and better opportunity. What that typically means, and again outside of comp, they’re looking for upward mobility. They’re looking for growth. It could be larger P&L management. It could be larger people management. It could be broader responsibilities from what they have. At least with our best clients, and we work with a number of Global Fortune 500, Fortune 1000 organizations, they spend a lot of time developing their people during their review period. They talk about, “Okay, you’re going to be in this role for X number of years, but let’s plan on … Let’s talk about where you would like to go within the organization. What skill sets are you looking to develop over time?” and figure out what skill sets that person may be deficient in so they can get them the right training, coaching, mentoring, so when it comes time to apply or get recommended for that next leadership opportunity, they’re ready to go. Again, the best companies are very much on top of that, because if they’re not continually asking that question and understanding the employee’s mindset, often that’s the trigger point when someone can put that thought in that candidate’s head and get them attracted to potentially make a move.
Adam Robinson:	If there is one mistake that companies make as they go about engaging the search process, either a misconception, a misperception, or a mistake they make when they’re in a search, what would you counsel listeners against doing, or what trap can they avoid?
Matt Schwartz:	I would say a company needs to have a very clear vision of the role. One of the things that we guide our clients to do is to develop what we call an asset test, which are the three to six key criteria that a candidate must have in order to be right for the role. Then they actually build a competency-based assessment, I do a competency-based assessment, against each candidate to figure out, do they match up against that asset test? Then the other thing is there’s often another short list of soft skills and personality traits that the person needs to represent in order to be a good fit for the company. Being laser-focused on that, having your interview committee not have someone re-hash their background over a course of four, five, six interviews in the course of a day, but having people focus much more on specific skill sets and examples can really help people get a clear understanding of the candidate, give the candidate a better interview experience, but also a broader perspective on the company, how they work, and the different roles that people have as far as the interviewers go in the process.
Adam Robinson:	What’s the best way that I, as a company engaging a professional firm such as yours, how do I get the most value out of the relationship? I’m going to be investing a substantial fee, but the value is there if I do it right. What does an ideal client do that really delivers value to them?
Matt Schwartz:	Yes. First, there are sometimes clients who view a search firm-client relationship as fetch and not search. It’s understanding that they need to invest the time upfront during that discovery process, as we talked about earlier. Two, make themselves available to answer any questions that come up during the search process, so we can move quickly, have a deeper understanding of something that maybe we didn’t get answered upfront.
	Then from there, be a very active participant in terms of giving timely feedback on resume submissions and interviews, and making sure that they’re available for … We offer weekly update calls. They don’t have to be long. We don’t go through every single person we’ve contacted. Sometimes our searches take up four, five, six, seven hundred people to get a winning candidate in the boat. We don’t have to go through everyone, but we need to go through the most relevant candidates so they understand, “Okay, the search firm has done their job. They’ve come back, given us insights on what’s happening in the market, and these are the most qualified and interested people that have surfaced through their effort.” Again, making themselves available.
	Then lastly, during the close of the search and actually making an offer and closing the deal, being able to be present and show the love to the candidate to express how excited they are to get them on their team and bring them into the organization. Very often, clients will look at this as a little bit more transactional, and the more senior you go, the less transactional these searches are.
Adam Robinson:	You mentioned something early in our discussion about employment brand being important. It’s something we talk about all the time here on this show. What role does brand play in the process, and how can listeners harness their own employment brand to increase the inbound interest in their open roles?
Matt Schwartz:	Yeah. When I think about some of our best, well-known clients, whether it’s an American Express or a PepsiCo or a Fidelity Investments, these companies have done a phenomenal job at getting on the lists of the best companies to work for and having it known out there that that’s something that is important to them, and really taking care of their employees. That’s one. Two, when I look at a company like General Electric, although they’re going through some rough times at this moment, over the last five to 10 years, it was amazing. They’re one of the few companies that went out and put out television ads showcasing that, “Hey, a tech engineer can go work on software for trains at GE and have a dynamic opportunity.” I don’t know if you remember that ad, but it was great.
Adam Robinson:	I do, the college dorm room where he walks in and says, “I’m going to work for GE,” and people look at him like he’s crazy. I thought that was super effective.
Matt Schwartz:	Absolutely. Absolutely. Companies that will take that shot and spend the money to do that are potentially going to get the attention of the market and say, “Huh, maybe this is a great option for me.” Yeah, I think that’s … Those are two things that I think are really phenomenal. Also, there are a lot of companies that … I think of Pepsi. We worked with them for many, many years. They’re always looking for great people, but just because you have a great background doesn’t mean there’s a job for you at Pepsi right now. They actually went ahead and put together pepsijobs.com, which lists jobs like a lot of other companies do, but you could also submit yourself to their database and say, “Hey, I do have an interest in working for your company if something else comes up in the future.” I know their internal recruiting teams would go there first to say, “Hey, who’s raised their hand and said they want to work here, opposed to us going and hiring a search firm or a contingency firm to go and do this for us with a big fee?” They’ve saved millions and millions of dollars in search fees just relying on people raising their hand and saying they wanted to work for their company.
Adam Robinson:	Now with the three or four minutes we have remaining here, I want to gaze into the crystal ball and just harness your power of future sight and look out. What does the rest of 2018 look like from a recruiting and hiring standpoint, and what trends do you see emerging now that, over the next two to three years, will impact employers in a meaningful way?
Matt Schwartz:	I just wrote a blog post that talked about, if your CEO is not the leader of the company’s digital transformation, you’re going to fail, basically, that we’re seeing companies just at war with so many startups that if they don’t change the way they do things, it’s going to get even more challenging for them in the future. One statistic is, since the year 2000, over 50% of the Fortune 500 have either been acquired, merged, or declared bankruptcy. If they don’t continue to grow and change, this is going to be a problem. What we’re seeing is companies completely reorganizing themselves, realizing that the siloed organizational structures of the past have created huge bottlenecks to innovate in the areas of digital and technology. They’re moving to a much more agile environment in order to be competitive, and are scrambling to acquire the talent in areas like artificial intelligence, machine learning, cloud computing, smart grid technology. These are all trends that are coming and coming fast. Again, the CEO has to take the leadership position on this vision to really drive this forward.
Adam Robinson:	Now, does that mean that large companies are looking for early-stage talent? I know the examples. Small-to-big and big-to-small transitions are fraught with peril. When a large-cap company comes to you and says, “Hey, listen, Matt, we’re looking for somebody with a startup mindset. Let’s go into an early-stage company and pull an executive,” the things that make people successful at a startup are generally blank slate, lack of systems and rules. You can fill the vacuum with your own capability. That infrastructure is fairly rigid at larger companies and vice versa. If I come to you and said, “Pull me an executive out of a startup, and let’s go for it,” or if I was a startup saying, “We really need that big company thinking,” what are you telling me?
Matt Schwartz:	Yeah. It typically is massive organ rejection on both sides. I’m not saying that they want to go and hire people from startups. A lot of our large clients want people from the companies that are well-established today, the Googles, the Amazons, the Microsofts, where perhaps they’ve spent a few years building that foundation and building a lot of credibility, and then could bring it into their more traditional environments. Too many companies have hired the same MBA types for years, and they all have great analytic skills, but often they tend to be a little bit more risk-averse.
	Some of these companies that have been pioneers in their industry, bringing someone in from one of those organizations could be tremendously beneficial. But when you look at someone from a startup, people usually feel if they like that startup culture, it’s going to be very, very hard for them to go into a larger company, especially if there’s too many layers, hard to get things done, hard to get decisions pushed through, and they can’t be as nimble as what they’re used to. Again, completely agree with you and definitely see a lot of organ rejection unless a candidate is highly motivated to make that happen and for some good reasons.
Adam Robinson:	I understand you’ve got some free tools and content that listeners can take advantage of to do some further digging on some of the things we’ve talked about today. Where can we find that?
Matt Schwartz:	Absolutely. Again, for more information on our firm, it’s mjsearch.com. We’re also offering a free e-book on transformational talent. You can text mjsearch to 44222. That’s mjsearch to 44222. We’ll ask for your email address, and we’ll shoot that e-book right over to you.
Adam Robinson:	Excellent. Ladies and gentlemen, that’s the final word. You have been learning from Matt Schwartz, CEO and founder of MJS Executive Search. Matt, thank you so much for being on the show today.
Matt Schwartz:	Thank you, Adam.
Adam Robinson:	That’s a wrap for this week’s episode of The Best Team Wins Podcast, where we’re featuring entrepreneurs whose exceptional approach to the people side of the business has led to incredible results. My name is Adam Robinson, author of the book The Best Team Wins, which you can find online at www.thebestteamwins.com. Thanks for tuning in, and we will see you next week.