International Search! Sounds sexy, sophisticated, jet setter-ish, and on target for what is now our Global Economy! It’s all those things and more. While it is exciting, it is more of a headache from a recruitment standpoint; however, like everything in life, it’s all about timing.
When I first started recruiting in 1988, the economy was doing ok. I was young, inexperienced, full of zest and full of aspirations, yet somewhat naive. I had just graduated from Michigan State University the previous summer on the “five year plan” with two degrees.
The challenges that the recruitment industry posed were still a mystery to me. I was confident that whatever I did, I’d be successful, but I still didn’t “get” what a recruiter was supposed to do. Sometime in 1989, the placement process (and all the steps that the infamous Trainer Tony Byrne preached) finally clicked and I got it. Everything started to come together and make sense. I was not making all these calls in vain. Hiring managers started to listen and offers were going out and being accepted. I was making a lot of money for a 25 year old…and then BOOM, the 1990 recession hit.
It was a perfect time to specialize and be GLOBAL
From a global perspective, this was an interesting time. The Japanese automakers were expanding in the U.S. In 1988, Toyota has just instituted a three-year, 36,000-mile warranty on vehicles, and several other foreign automakers started infiltrating the U.S. market thereafter. Automotive suppliers (my clients) who were selling parts and systems to the former Big Three (GM, Chrysler, and Ford) were now struggling with the economic uncertainly and found growth opportunities with the Japanese Original Equipment Manufacturers (OEM’s). The Japanese OEM’s were making history during this time with amazing sales and profits, and they continued their expansions. In 1989, Honda’s Accord was the best selling automobile in America. What my clients didn’t have were people/employees that knew how to do business with the Japanese OEMs, and they were looking for this specific talent in both engineers and sales people — already one of my specialties. It was a perfect time for me to expand my interests in other cultures and market myself as a recruiter who specialized in Japanese bilinguals. The downturn in the economy afforded me the time to invest in this specialization.
Having the time of my life
Women in the Japanese business world didn’t exist at the time. I broke all the etiquette rules. I didn’t know any better. Calling the Japanese by their first names is not something that was done. It was also a time where many Japanese people didn’t have experience working with people in the U.S. It was a new time for everyone. Thus began my expansion into international recruiting. When encountering a female recruiter, brazen enough to ask for people by their last name and then using their first name when I got them on the phone, it must have been an intriguing situation for the Japanese professionals that I recruited. Regardless of making numerous faux paux, it worked. It was a time of breaking down cultural barriers and finding the talent my clients demanded, regardless of what I knew and didn’t know. The candidates were in demand and it was a time to make a name for myself… and money — a lot of it.
My expansion led to organizations asking me to find Japanese bilingual talent to work in Japan as they started setting up satellite offices. I remember going to a trade show and seeing a Japanese man standing at a booth. I asked him for his card. We both did a little bit of nodding or half bowing and I got his card which stated he was a General Manager. We really didn’t talk. What timing! Several weeks later I got a call from a multi-national client I had been doing business with. I had been persistently marketing myself as a recruiter who specialized in international placements and in bilinguals, keeping it general as Mexico was also a targeted hot spot. I called the Japanese General Manager that I barely met and recruited him to go work in Japan. He was my only phone call on this search. (Sometime we get really lucky!) Two months later, I was having dinner with this Japanese gentleman and his wife prior to them moving back to Japan. It was over a $60,000 fee. I was now an International Recruiter. It felt great. So much prestige, such an ego boost, so neat to be so global and such a nice pay check! What a time I was having!
During these years, very interesting personal relationships began developing with people, and I am still in touch with many of them today, some twenty years later. I have traveled to Japan on more than one occasion and have been hosted in Japanese homes. I was taught by a group of Japanese woman how to prepare and serve green tea in the traditional ceremonial fashion with each hand movement having to be very precise. All this was done in the kneeling position. My knees have long since recovered, but the insight that it provided me into Japanese ways and philosophies was invaluable and afforded me more conversations in business than I could count. The more questions I asked the more my expertise was developed in the differences in business and cultures between the US and Japan.
It was a time in my life where my desires to grow culturally were fed. As a recruiter who has always been interested in other cultures, it was a way to nourish myself intellectually as well as financially.
When doing international searches, always charge 35% for the service. Recruiting internationally requires working in multiple time zones. This is extremely time-consuming when Asia is 12-15 hours ahead and Europe is 5-8 hours ahead. Your days are long and your life is interrupted by having to make calls at times when your clients and candidates were available. Some recruiters would argue that they’d accept a lower fee, especially when retained. Having done both retained and contingency search and having negotiated my fees over the years, I still stick to the “degree of difficulty” theory. Based on the degree of difficulty (recruiting for overseas positions is never easy) and time commitment, my search fees for international placements are non-negotiable.
There are so many more things that can go wrong in international recruiting and nuances that you learn to be aware of. For example, when one resigns in Europe, the normal period of giving notice is two months. A lot can happen to delay the start date and hence, there is a delay in getting paid. I had a German candidate that was prepared to give two months notice, but then had to further delay giving notice due to a death in his family in the Philippines. Try finding a place to fax or email an offer letter in a rural area of the Philippines so that the candidate can make a decision and can give a two-month notice by a certain deadline. (That deadline was because the candidate’s boss was going on holiday for one month and he needed to give notice prior to his boss’s departure. One-month holidays are also a norm in Europe.) This circumstance took up a lot of time that I could have been spending on other searches. The lesson learned was invaluable and also taught me that persistence pays off and the ability to get things done is always possible if you are willing to put in the effort. Taking some of these circumstances into consideration taught me to structure international fee agreements on a retained-only basis and to make sure I based “payment due” on offer and acceptance, not start date. Hind-sight was gained and the lesson was learned.
Even retained searches can go bad. Taking into consideration the culture and countries you are dealing with makes a huge difference in whether or not to invest the time — your time. In later 2008, I met with a gentleman who was heading up staffing a Chinese/Israeli OEM joint venture (JV) in China. They were going to need at least twenty executives. I was looking at over a million dollars in placement fees for 2009. Cha-ching! Very long story short; although I was forewarned by others, I found it to be true; the Chinese don’t honor their contracts. Basically they decided that they did not like Americans and were not shy about expressing this sentiment. So much so that they hired one U.S. citizen from me who was of Russian decent and told him that he was being hired because he really was not American. Soon my contact was gone and so were the US employees the JV had hired previously. They basically told me that my contract was void. They had not released any other openings “officially” to me yet and hence then didn’t owe me any other fees.
That was nine months of my 2009 in which I had invested my time, with a retainer in place that basically was not worth the paper it was written on. It was not a good time for me. However, it was a time to realize that I would not ever trust doing business with a Chinese company again. That’s not to say that I would not take on another search in China. I would and I have, especially if it’s with a U.S. or European based company. However, I would make sure I structure the agreement differently and would not throw all my eggs in any one basket again, no matter how much business was being promised.
Effects of Economies
Another lesson learned was that any economic collapse can affect every country in the world, even really rich ones like the United Arab Emirates. In 2009, I completed a search for a Lean Engineer to streamline the janitorial process at the largest shopping mall in the world, located in Dubai. We were billing $1,000 a day and making a huge profit (they “had” a lot of money to throw around). One day in the midst of the economic crisis, Dubai decided to just turn off the lights, — at least, that is how it was described to me. There was construction going on everywhere (in the middle of the night) and then in the course of about two weeks, the whole country shut down and all the development stopped. All the workers were sent home. (In Dubai, if you are on a working visa and the job ends, you have to be out of the country in 24 hours.) All the flow of money stopped, and my U.S. based client was not getting paid. He was having trouble collecting and hence, I stopped getting paid. To this day, I am still receiving money monthly on this search in the form of a payment plan from our client.
Things can change so quickly in our business. It is part of what we all love about it. It is dynamic. You just have to prepare yourself for the unforeseen. You cannot speculate on the variety of things that can go wrong.
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Of course, there are also things that go right, as long as you are doing your job. We have always been taught to have a “back-up” candidate. Who could have guessed that my client would hire two Sales Engineers in France, the leading candidate and the back-up. That was certainly unexpected but doubled my fee for the trouble. Good thing I had a back-up!
When working on internationals searches, there are some basic things that one should consider to save time.
- Make sure you have a signed fee agreement with at least an engagement fee or retainer committed to it ( for your time).
- Know the currency in which your candidate is getting paid, know the currency in which you are getting paid, and work out any conversion rates upfront.
- Know the time zones in which you are recruiting.
- Know the reputation of the area in which you are recruiting (Is it very rural, crime stricken like many parts of Mexico, highest cost of living in Europe, etc.).
- If you are searching in the U.S. and placing someone overseas, what does the expatriate package look like? Are they paying for housing, cost of living adjustments (COLA), children’s schooling in American schools, pack and move, temporary housing, etc.? Is there a repatriation consideration (will there be a buyout if things go bad, will they move your candidate home with their belongings), will they pay for the upfront cost of leasing a home (sometimes a year deposit is required)? These details should be found out upfront.
- By whose laws is the contract binding? (If it’s in China, good luck. And if it doesn’t have a stamp, it is usually not official)
- Who is paying for recruitment expenses — phone calls, FedEx, travel, etc.?
- What are the working conditions?
- What is the time frame on the search? If it’s a replacement, do you need to wait for a mandatory notice period before the person can start?
- There are social media sites in other countries that are like LinkedIn. Find them and use them to network and target specific companies from which you want to recruit.
Timing Is Everything
Depending on where one is in their life, international search is a matter of interest and effort. The older I get and the more valuable my time is, the more I think twice about the searches I take on. We are coming into an awesome time to be search consultants. Due to demographics alone, not to mention the “over” downsizing that has been recently done in this new economy, it is our time to ring the placement register!
The cost of one’s time when it comes to working on domestic searches versus international searches is huge. International search is demanding. The onset of the Internet, social media, and networking sites has made the world a much smaller place. “Six degrees of separation” is really only six calls away. Recruiting internationally has never been easier. If your best client needs you to do an overseas search, it might be worth taking it on for experience’s sake. Personally, I would take it on because I love the challenge and enjoy learning from the new experience and dealing with people of different cultures. However, this is really up to you to decide. Some recruiters out there rather work 40-50 hours a week then 60-70 hours for the same financial result.
Yes, international search is sort of glamorous in the beginning. Heck, it even feels glamorous when you are recruiting on the search. But when you look in the mirror at 4:00 AM when the alarm clock goes off so you can make that call, you certainly do not look that glamorous.
You have to weigh what is valuable to you. Is it more important to have that time to spend on your family and extracurricular activities, or is the inherent value of doing something different and challenging worth your time?
Although most of my days are spent recruiting engineers, operational executives, and sales professionals in several industries, it has always been very exhilarating to say that I specialize in bilinguals and international search when the opportunity arises. Reflecting on the path my career took, I can tell you it was a saving grace. How fortunate I was to develop a niche in a down market at the beginning of my career that formed a nice cushion for the roller coaster ride over the past twenty-three years. It was all about the market timing when it began. It gave me something to grasp and from which to learn. Learning is good; it keeps life from getting stale. I have friends all over the world today as a result of my interests in other cultures and being willing to put forth the effort and make the sacrifices necessary to deal with the nuances of foreign search assignments.
Yes, there have been days that I found it to be very time consuming and, of course, there were let-downs when the efforts did not pay off at all. However, the knowledge that I gained was quite an investment in myself and my future. There are higher fees to be made for handling international searches when you are able to set the price for the niche you developed. The outlook is even brighter when you think about how global our world has become. When the economy is booming, you can pick and choose the searches you take on and hence decide whether or not it is the right time in your life to take on the demands of an international search assignment.
This article is from the March 2011 print Fordyce Letter. To subscribe and receive a monthly print issue, please go to our Subscription Services page.