Contingency Search vs. Retained Search

Ep.#3 [THEME SEVEN]

If you have been following along in this mini-series, we’ve been tackling one of the hardest topics an owner/leader typically faces: how to find, hire, and pay A-players. Today is part three of four, and we’re tackling how to engage an executive recruiter in case you want to go that route to find your next A-player.

Hiring a recruiter to find your replacement can be a daunting task, not only financially but also emotionally. My goal with this interview is to demystify the process and services of an executive recruiter and give you the information you need before making a decision to hire within, recruit organically, or engage a firm to do it for you.

Today on the show I interviewed Mike Frommelt, CEO of KeyStone Search, an executive recruiting firm based in Minneapolis, Minnesota. Mike shares–with full transparency–how he sources, hires, and integrates high-level executives into companies with business owners who want to separate themselves from the management role. 

The reason I chose to have Mike on the show (again) was because of who he is and the approach his firm takes. Mike is one of the most genuine people I have met, and his firm specializes in EOS© founder-led companies as well as ESOPs.

In this episode, you will learn how an executive recruiting firm finds key executives (especially since most of them already have jobs), how they can help you decide whether your internal candidates are an option, what assessments and vetting processes should be used to make sure these executives are the right fit for your company culture, how to effectively and efficiently go through the hiring process with these executives, and finally, what results you should expect, as the business owner, after these people are onboarded. 

Hiring a high-level person to fill your shoes on the leadership role (W2) side of your business is a huge milestone to getting back your freedom, creating value, and future choices about when and how you want to monetize your asset. 

Hopefully this episode gives you the confidence you need to know it is possible to find your replacement so you can enjoy work, create wealth, and have an impact.

// WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast

What You Will Learn

• What you should expect when hiring an executive recruiter.
• How to determine whether you should hire within or go outside your company.
• The three phases an executive recruiter takes when placing someone in a company.
• How Mike assesses key executives to make sure they fit the company culture.
• What a culture blueprint is and how it’s part of recruiting and onboarding key executives.
• How Mike’s firm works with the current management team to get them involved in the process.
• The personality tests Mike uses when assessing new hires.
• How a clearly defined short-term and long-term compensation plan helps in the recruiting process.
• The process KeyStone uses to build a list of over 150 executives across the country… who already have jobs.
• What is truly important to key executive candidates when looking to make a move to a new company.
• Why and when an executive might move across the country to work for a company.
• Why key executives–who can make A TON OF MONEY–want to work for someone else even though they have the skills to do it on their own.
• Why and when it might make sense to pay the fee and hire a recruiter.
• How long a hiring agency stays involved once an executive is onboarded.

// USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment

Bio:

Mike co-founded KeyStone Search in 2002 and has over 30 years of executive recruiting/search industry experience.

Mike has led hundreds of executive level search projects over the years and has developed particular expertise in leading privately held businesses through critical leadership transitions. This includes numerous CEO transitions as well as business owner exits/transitions.

Mike grew up in a small family business, learning the value of hard work, customer service and treating everyone with respect. “Working with companies & owners who recognize and appreciate the value of their employees, customers and communities is incredibly rewarding” says Mike. “These companies deserve to grow and succeed into the future, and I’m thrilled to play a part in making that happen for them”.

Mike graduated from the University of St. Thomas with a B.A. in Psychology and Business Administration. He is a frequent public speaker on the topics of CEO transition, succession/exit planning, corporate culture, talent development, and core values. He is an active member of the ESOP Association and the National Center for Employee Ownership.  Mike is also very passionate about EOS®/Traction, having run the system at KeyStone for nearly 10 years.

Interview Quotes:

18:11 - “The core values of that owner. What gets them out of bed in the morning? How they behave on a day-to-day basis. How they treat their employees. How they treat their vendors. Everything that they do on a day-to-day basis is reflective of their core values.” - Mike Frommelt

20:00 - “We have a tool we call our Culture Blueprint, our core values assessment. We ask them do that over a period of time. We don’t just sit with them and just ask them the questions.” - Mike Frommelt

20:46 - “I think where companies makes some mistakes is they let the marketing team write their core values. Or they let the HR team write the core values.” - Mike Frommelt

26:30 - “Communication is a really big piece of it.” - Mike Frommelt

27:04 - “Sometimes the owner doesn’t really know what a president really looks like or what a president should do.” - Mike Frommelt

41:08 - “I find that a lot of owners don’t really want to [just sell out] because they are worried about what happens to their employees and where the company is located.” - Mike Frommelt

42:23 - “One of the things that we’re generally looking for when we’re doing these positions is we’re looking for someone who’s been where you want to go.” - Mike Frommelt

42:45 - “The difference between how a thirty million dollar company works and how a fifty million dollar company works are very different.” - Mike Frommelt

48:57 - “Culture [and growth opportunities] always trumps pay.” - Mike Frommelt

59:39 - “I don’t know that there is such a thing as too [many meetings to discuss hiring someone].” - Mike Frommelt

01:08:12 - “You really don’t want to do an executive position on contingency.” - Mike Frommelt

01:16:42 - “Any owner out there, any entrepreneur that’s started a business or ran one, you’re already a success. It’s about trying to figure out what do you want.” - Mike Frommelt

Links and Resources:

Keystone Executive Search

Find Mike on LinkedIn!

Arkona Website

The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision)

Intentional Growth™ Financial Assessment

Fractional CFO Services

You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.