SERVING THE QUANTITATIVE FINANCE COMMUNITY

 
User avatar
aiQUANT
Posts: 91
Joined: June 4th, 2008, 6:20 pm

New project : being a headhunter

June 29th, 2008, 11:35 am

If I decreased the price (lol: LowCost HeadHunting) is that a good advantage or company will pay watherver it costs for the good candidate? On a similar note does an expensive headhunter lower the chances of a candidate being placed?
 
User avatar
Traden4Alpha
Posts: 23951
Joined: September 20th, 2002, 8:30 pm

New project : being a headhunter

June 29th, 2008, 1:25 pm

QuoteOriginally posted by: RecruitorI received a lot of CV from headhunters (cause I'm a team manager so I hire) and when I see the price (about 30% in average), I'm driving crazy. If I decreased the price (lol: LowCost HeadHunting) is that a good advantage or company will pay watherver it costs for the good candidate?Before you cut prices, you might need to do a bit of thinking first. Now my numbers may be off significantly, but I think you will find that pimping is more time consuming than it seems.Assume that you want to earn a "quants salary" by pimping other quants. Assume that to earn a quants salary, you need to get double that in revenues (to cover VAT, employment taxes, benefits, etc.). Can you successfully place 6.6 quants per year? Next, consider the number of people interviewed for each slot that aren't represented by you and the chance that your candidate wins the job. Thus, you need to get perhaps 3 to 6 interviews per successful placement (assuming your CVs are of market-clearing level of quality). Can you get 20-40 interviews per year? Next, consider the number of people applying for each slot that aren't interviewed or aren't represented by you. Again, you need to get perhaps 3 to 6 potential CV-slot pairs per expected interview (assuming your CVs are of appropriate quality). Can you find 60-240 good CVs and good job openings per year? Next, factor in various failure modes in which a promising CV fails to get a job (e.g., the employer kills the opening or the candidate declines the offer). Now, you need to find even more CVs and job openings each year just to get interviews, offers, and placements. Again, my ratios may be way off, but the fact remains that pimping is a numbers game -- you need to find large numbers of job openings and large numbers of qualified applicants to feed the job selection funnel and make enough placements per year. A low cost strategy only makes the numbers worse (unless you forego earnings). Because pimping is a numbers game, the amount of labor a HH can devote per candidate and per job opening is relatively modest. And because pimping is a numbers game, the incentives to over-promote a candidate or over-promote a job are really high.And even if you can find lots of perfect candidates for lots of perfect jobs, why charge less than 30%. How much is a really good candidate worth to a company? How often did you, as a hiring manager, pick the HH candidate because you'd rather have the right person at cost = salary*1.3, than the wrong person for cost = salary*1? Shouldn't an employer share the profit of having a good new employee with the person that recruited that new employee?All that said (and I don't mean to be discouraging, only pragmatic), I'm sure recruiting is a interesting line of work and I can imagine all manner of innovations that could make HHing better.Good Luck!
 
User avatar
DominicConnor
Posts: 11684
Joined: July 14th, 2002, 3:00 am

New project : being a headhunter

June 29th, 2008, 4:48 pm

In my experience any business strategy that is mostly based upon lower margins will die. That is independent of business type.That is wholly different from understanding the system well enough to work out how to do it cheaper, since then you can decide where the optimum between greater volumes through lower cost and margins lie.In my Guide I talk of using your finance skills to make better career decisions, the same applies to making business decisions, it is after all what finance techniques are for.I guess you've done at least some physics, else you wouldn't be on this forum, so when you observe a system in some sort of equilibrium for many years, with some numerical parameters hardly varying at all, what should your for initial assumption be about how easy it is to change ?To use some economics from undergrad level, there have many recruiters, the barriers to entry are not all that high, and there exist many customers. Not quite an perfect market, but the basics are there. I guess there are something like 150-200 organisations in this space.Do you think that it has not occurred to anyone else to try to expand their business big time by cutting fees ?There is one very large IB who insists on very low pimpage fees. We don't do business with them, part of me is tempted to give you the contact details, just so I can watch the sport between you and their HR.You can guess which firms HH for them.
 
User avatar
Recruitor
Topic Author
Posts: 17
Joined: June 27th, 2008, 10:46 am

New project : being a headhunter

June 30th, 2008, 9:33 am

When I talked about "low cost HH" it was quite humoristic. The high price is one of the reaseon why I want to try to set up a business. But in France (I'm French man in the UK), companies are reluctant to pays some HH fees (HR in France are God on hearth in the company: they do pay roll, formations, recruitments, psychologic tests,...) they don't want to share their business. So it could be a strategy but low cost=low service, I totally agree.Traden4Alpha, i don't want to stop the my Job, I only want to launch a business to ad a few income to my salary. The first target would be to place 3/4 persons a year counting on my network essentially. But figures you give are to my mind realistic, I thought, to live with a decent salary it bould be 8/10 people placed a year. So you're totally right.Then, from a candidate point of view, I can't bear talking to a headhunter who doesn't understant the job itself. Indeed, how often do they sell a job they couldn't do? Or worst they couldn't understand? Then they always talk about the new job better than he really is (but I can't blame, it's understandable, the candidate afte interview is able to know exaclty what the job is) but also disparage the job you are in (and that's unacceptable).
 
User avatar
TraderJoe
Posts: 11048
Joined: February 1st, 2005, 11:21 pm

New project : being a headhunter

June 30th, 2008, 10:48 am

QuoteRecruitor: I'm French man.The only good French man ... I'm kidding .TJ.
 
User avatar
rmax
Posts: 6080
Joined: December 8th, 2005, 9:31 am

New project : being a headhunter

June 30th, 2008, 11:51 am

QuoteOriginally posted by: RecruitorThanks, RMax.However I couldn't point the real problem in what you're saying...I am saying (although I'm sure Dominic is very different ) that HH have a very different requirement that the candidate.As a HH you will get more business off the people you are recruiting for. They are your clients. The candidate is the commodity. Once you have placed a candidate (a commodity) you don't really need to keep up much of a relationship with them except to find out who else worked in their firm, the structure and how you can get people out, their worth to you is significantly less than it was before. It is unlikely that you will place that candidate again (as you will have come clause that will stop you lifting people from firms you have placed) so you also only need to be passably polite (sometimes not even that). Hence from a candidate POV you are just using him/her.However your client will continue to give you mandates if you keep them on side and hence you have to maintain a good realtionship with them. The upshot from this little diatribe is that you idea of a perfect HH is almost impossible given the arguments of above. The most you can hope for is not to be as bad to not know the industry, blatently tap you up for more candidates, lie about the job to get you to attend the interview, reformat your CV (with introduced errors) without your consent etc.
 
User avatar
TraderJoe
Posts: 11048
Joined: February 1st, 2005, 11:21 pm

New project : being a headhunter

June 30th, 2008, 12:18 pm

Be honest and act with integrity. You will instantly be ahead of 99.99% of all recruitors.
 
User avatar
Recruitor
Topic Author
Posts: 17
Joined: June 27th, 2008, 10:46 am

New project : being a headhunter

July 3rd, 2008, 7:18 pm

My company is set up... Let's go!I'll keep in touch with news...
 
User avatar
gjlipman
Posts: 1102
Joined: May 20th, 2002, 9:13 pm

New project : being a headhunter

July 5th, 2008, 12:50 pm

QuoteOriginally posted by: RecruitorDominic, of course my personal business will be done on my spare time, not with my job time and tools. If so, it would be understandable if my boss disegreed!Even if you're doing it in your own time, with your own tools, I'd be shocked if your company was ok with it. I can't see how there couldn't be conflict of interest - if you place someone in your own company, obviously, and if you place someone in a competitor, even more obviously. Or am I missing something?
 
User avatar
endian675
Posts: 143
Joined: March 11th, 2008, 7:09 pm

New project : being a headhunter

July 11th, 2008, 8:51 am

Go fill in the "directorship disclosure form" where you work, write in that you're operating a recruitment company placing people in the financial industry/quant world where you work, and see how long your job lasts. I think it will be a matter of days, possibly hours, before you're escorted out of the building. I have seen the very same thing happen for real.
 
User avatar
endian675
Posts: 143
Joined: March 11th, 2008, 7:09 pm

New project : being a headhunter

July 11th, 2008, 8:52 am

double post
Last edited by endian675 on July 10th, 2008, 10:00 pm, edited 1 time in total.
 
User avatar
ArthurDent
Posts: 1166
Joined: July 2nd, 2005, 4:38 pm

New project : being a headhunter

July 11th, 2008, 2:21 pm

QuoteOriginally posted by: endian675Go fill in the "directorship disclosure form" where you work, write in that you're operating a recruitment company placing people in the financial industry/quant world where you work, and see how long your job lasts. I think it will be a matter of days, possibly hours, before you're escorted out of the building. I have seen the very same thing happen for real.And not disclosing director or higher level participation is grounds for being fired when it is eventually found out.
 
User avatar
twofish
Posts: 4944
Joined: February 18th, 2005, 6:51 pm

New project : being a headhunter

July 11th, 2008, 8:01 pm

QuoteOriginally posted by: RecruitorTraden4Alpha, i don't want to stop the my Job, I only want to launch a business to ad a few income to my salary.You really, really, really need to check all of the papers that you have signed to make sure that this is proper. Most financial institutions very clearly and explicitly state that you are to have absolutely no other outside employment without written approval, and they make you sign a paper periodically that you agree to those terms.
ABOUT WILMOTT

PW by JB

Wilmott.com has been "Serving the Quantitative Finance Community" since 2001. Continued...


Twitter LinkedIn Instagram

JOBS BOARD

JOBS BOARD

Looking for a quant job, risk, algo trading,...? Browse jobs here...


GZIP: On