When Kelly L.
Boyer needed to hire a director of compensation last year, she turned
to Korn/Ferry International Inc. She had faith in the executive
recruiters. After all, the firm had gotten Boyer her job as vice-president
of human resources at Internet highflier GeoCities. But she didn't
commission the usual search, a lengthy process in which headhunters
scour their Rolodexes for candidates who aren't necessarily looking
to change jobs. Instead, she turned to Futurestep Inc., Korn/Ferry's
then new Internet subsidiary, which promises to help companies line
up candidates in four short weeks rather than the months it typically
takes. ''I was very, very skeptical at first,'' says Boyer.
But Futurestep
delivered. Within weeks, Boyer received a CD-ROM profiling three
candidates screened for skills as well as personality traits likely
to match the culture at GeoCities, a whirlwind Marina Del Rey (Calif.)
startup that hosts free home pages in common- interest communities.
The disk included video clips of interviews with the hopefuls by
Futurestep recruiters. She was sold. ''They save a tremendous amount
of time with the online cultural assessment and the video previews,''
says Boyer, who has since hired a half-dozen employees through Futurestep.
''I think they're fantastic.''
The Net is turning
traditional executive-search methods upside down. The ability to
instantly reach a huge pool of candidates anywhere on the globe
allows cyber-recruiters to cast a wide net. And it's cheaper than
doing things the old-fashioned way. No more cold calling. No more
hunting for a friend of a friend. When recruiting costs plummet,
headhunters can broaden their businesses. Those, such as Korn/Ferry,
which had targeted the lucrative corner office, are pushing to fill
mid-management ranks. And Internet recruitment startups that had
focused on the rank and file are moving up to fill top management
positions.
Korn/Ferry,
which set up its Futurestep site a year ago with The Wall Street
Journal as its marketing partner, was only the first to move online.
It was followed by the March launch of Heidrick & Struggles
International Inc.'s LeadersOnline. And last month, LAI Worldwide
Inc. jumped in with LAIcompass.com, which, like Futurestep, uses
software licensed from assessment consultants to attempt to match
candidates' personalities and ambitions to its clients' corporate
cultures.
The number of
job-search sites has exploded--at last count, the estimated number
was more than 5,000, without counting employers' own Web sites.
Most of the popular job-listing sites, such as Monster.com, CareerWeb.com,
and HotJobs.com, are patterned after the newspaper classified-ad
model: Recruiters pay to list job openings while candidates search
them for free. Fees start at $100. That's cheap compared with the
traditional approach whereby a firm charges from one-quarter to
one-third of the estimated first year's paycheck of the person they
place.
NEW PROFILE.
The proliferation of sites has led to changes in the profile of
the typical online job hunter. As late as a year ago, most of the
jobs posted were aimed at the high-tech crowd. These days, even
managers of nail salons and fast-food outlets are landing jobs online,
while high-paying jobs are also migrating to the Web. Says Stephen
Ste. Marie, CEO of CareerPath: ''We have jobs with compensation
well above six figures, and Silicon Valley companies looking for
CEOs with stock options.''
The trend has
some of the older firms on guard. ''I think online recruiters will
take share from the traditional retained search community'' by eating
into the low end of the executive-search business, says James M.
Citrin, managing director of the communications and media practice
at recruiters SpencerStuart. Korn/Ferry Chairman Richard M. Ferry
disagrees: ''The high end of the market continuously moves up, leaving
room for Futurestep.''
What will change,
Ferry says, is the nature of the search process. As people get more
comfortable with automated assessment and as more managers who got
jobs using online services move up in the ranks, they're likely
to turn to those same sites to find employees. ''Search hasn't changed
in 50 years. It's more intuitive than clinical, and this is a major
innovation,'' he says.
Futurestep's
service uses new technology with a touch of traditional expertise
thrown in. When candidates register at the site, they fill out lengthy
online questionnaires about their skills and career objectives,
working their way through a 45-question case study that analyzes
their decision-making style. That information is fed into a database.
When the company has a job to fill, it can search that database
for both skill and cultural matches, an assessment technique that's
proprietary. From there, Futurestep recruiters take over, doing
background and reference checks and interviewing the candidates
and often their spouses. The best prospects are sent a video kit
so the recruiter can do a face-to-face interview. Then, video excerpts
are compiled onto a CD-ROM, which the client uses to determine who's
worth flying in for interviews.
FAT DATABASE.
So far, the approach is paying off. With clients coughing up a third
of first-year pay for each search, Futurestep will turn a profit
by next year's first quarter, says CEO Man Jit Singh. It has closed
50 searches at an average annual salary of $117,000, and it has
built a database of 264,000 candidates who earn an average of $104,000.
Next year, Singh says, Futurestep will conduct 1,200 to 1,400 searches
in the U.S. and an additional 400 or 500 in Britain, where it just
opened an office.
The executive
search firms' Internet ventures will never have the hundreds of
thousands of jobs to fill that such sites as CareerPath and Monster.com
boast--but it's more than the old way. ''We'll never find 264,000
jobs,'' says Futurestep's Singh, referring to his current database.
''But we want to mentor and manage their careers, and we'll move
them up to Korn/Ferry if appropriate.'' Executive recruiters, with
their Rolodexes and telephones and clubby, old-school ways, could
never network across 264,000 candidates in the old days. With the
Internet, it's a cinch.
By Larry
Armstrong in Los Angeles, with Wendy Zellner in Dallas and Edward
C. Baig in New York.
