Room for Hope, Top Headhunter Says of Job Market

Source: Eileen AJ Connelly for Associated Press
[posted on 02/01/2010]

As the leader of one of the world's largest executive recruiting firms, Kevin Kelly has a unique view of the job market.

It's one that the Virginia native says was initially shaped by a transformative phone call he received on Thanksgiving 1990. A former roommate was on the line suggesting he come to Japan. He didn't have a job lined up, but decided to take a chance.

"That was a decision that changed my whole future," he reflected. "Prior to that, except for one trip to Europe, I had never been out of the country."

Kelly got his first job in recruiting in Tokyo in 1993. He would spend nine years in Japan, rising to become a regional managing partner for the Chicago-based Heidrick & Struggles. Then he transferred to London to lead a revamp of the firm's European business. He took the helm in 2006.

As CEO, Kelly is seeing signs that the worst of the economic downturn has passed. Hiring is starting to pick up for the top-tier executives his firm places. Companies are looking for ways to expand in both the U.S. and international markets.

Still Heidrick & Struggles suffered in the downturn. In 2009, the company reduced staff by more than 20 percent, or 360 workers. Kelly has now positioned the company to respond better to changes in the marketplace.

A key part of that transition is an emphasis on what he calls its "leadership advisory" services. The new direction aims to help clients with internal development, senior talent retention and succession planning, rather than simply filling open jobs. This new focus grew out of an internal review that found that 40 percent of the executives the company placed did not remain with those firms.

In October, Kelly told investors and Wall Street analysts the company "has moved from a hunker-down and ride-out-the-storm mode to an execute-and-action mode" for its leadership advisory strategy. Kelly has said he aims to grow the company to $1 billion in revenue by 2014 — a huge leap from the roughly $400 million projected for 2009.

Even so, the 44-year-old doesn't think any rebound will be quick. But he does see opportunities for American workers, particularly those who are willing to expand their horizons.

Here are some excerpts from a recent interview with Kelly.

Q. Is there one indicator that you watch to gauge the health of the economy and the job market?

A. There's a few. It's taken us 56 years — and two experts we hired last year to go through about 80 indicators — to come up with six or seven that correlate nicely with our business. There's really not a correlation between what we do in the executive space and unemployment.

Q. Yet, executives have been hit hard in this downturn, just like the rank-and-file. What can people who used to have those high-level jobs expect, if you're seeing an uptick in executive search?

A. When we saw a pickup in recruiting in July, a lot of that I attributed to pent-up demand. Some companies got to the point where they couldn't function. Hiring will pick up, but I don't think this recovery will be like 2003 and 2004, where it happened at a much faster pace.

What we're finding is that companies and organizations may have laid off 500 or 1,000 people. They're not going to hire 500 or 1,000 back, but they'll hire 200 or 300. People are still feeling the shock of what happened and the pace at which it occurred. That being fresh in everyone's mind, we don't want to have to go through that again, because it's damaging for morale. I truly believe there will be more caution, at least for the next 12 months.

Q. Do you have any advice for those who have been out of work for a year or more?

A. You will get another job. Don't jump on the first thing. You get to the point where you're going to panic and take any job. Make sure it's right for you, or it's going to be challenging over time. Take a job that offers some stability in life, even if it means changing directions. I don't think anyone's going to look down on the fact that you did something different. You may even enhance skills for the next job you take on.

Q. How can people who are faced with switching industries or careers evaluate a job offer?

A. I would just embrace the opportunity to do something different. Not long ago, I talked with students at a business school about this. Most of the graduating classes went in wanting to work in consulting or banking, but in this environment, there weren't as many options.

I said to think about three things — your interest in what you're doing, compensation and the opportunity to learn. When I talk about compensation, it's really about being treated fairly. Most people don't leave for compensation, they leave their job because of lack of appreciation. And for many people in the workplace, the learning curve flattens out. You may have the opportunity to do something different and actually bring that experience to whatever job you take on in the future.

Q. Where are the opportunities going to be as the recovery picks up steam?

A. Foreign companies are looking to capture market share in North America. Large American conglomerates need to grow their businesses as well. The challenge we're having is finding the international American. We need people with the capability to understand different cultures and different styles of working.

Q. You have a book coming out in February. What is the focus of "Leading in Turbulent Times?"

A. We interviewed roughly 30 CEOs. What struck me in writing the book is that it was fairly consistent across the globe — in Russia, the Middle East, China, Japan, Korea. When times get tough or difficult, it's the softer skills that come forward: The long term vision, the ability to get people focused on what's going to happen longer term and get people off the short term. People in the organization judge the organization by how passionate and committed you are.

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