active candidate: An individual seeking immediate employment. Active candidates are usually unemployed, unhappy with their current employers, or facing unemployment in the near future.
applicant: Anyone who applies for a job. Applicants are considered highly motivated job seekers and active candidates. See also active candidate.
behavioral interview: An interview format in which interviewers seek to assess and understand the interviewee’s career history and performance. The premise of this type of interview is that past behavior is the best predictor of future conduct.
benchmark candidate: A person who represents the “ideal candidate.” The recruiter and search chair interview the benchmark candidate to gauge whether the job description is clear and correct. This interview occurs before the recruiter actively begins the search.
benchmark interview: An interview with the “ideal candidate,” which is used to gauge the recruiter’s understanding of fit.
boutique recruiting firm: An executive search firm that is operated in a hands-on manner by a small number of experienced partners. Many senior consultants from large firms have jumped ship to set up their own boutique firms. This is a main reason behind the steady decline in market share for larger firms.
candidate: A person being considered for an open position.
candidate report: A report produced by a recruiter after an interview with a candidate. Its purpose is to quantify why the candidate is or is not right for a given role.
candidate road map: A search strategy that details the who, what, where, when, and how of approaching all qualified prospects in a systematic manner.
candidate universe: The group of candidates who might meet the basic qualifications for an open position and are considered worthy of further investigation. Creating this list of potential candidates is the first step of every search. The candidate universe will vary in size depending on the job type, industry, geography, organization, and hiring manager requirements.
confidential candidate brief (CCB): A document used by the recruiter in lieu of a résumé or CV during the qualifying stages of a candidate search. The CCB asks specific questions about a candidate’s experience relative to the position that needs to be filled.
contingency recruiting: A form of recruiting in which fees are paid to the recruiter only after a candidate he or she identified is hired. This type of recruiting is usually done only for positions that pay less than $125,000 base per year.
corporate culture: The behaviors and views that shape how a company’s employees and managers interact. Corporate culture typically develops over time but may not be expressly defined.
counteroffer: Either an offer given by a candidate’s current employer to keep him or her from accepting a job elsewhere or a candidate’s request to improve on an offer being made by an employer.
curriculum vitae (CV): A document prepared by a job seeker that describes in detail his or her career history, education, and qualifications. It may also list publications, awards, affiliations, or presentations. CVs have legal standing, meaning there can be consequences if they include false information.
CV: See curriculum vitae.
employer brand: An employer’s reputation. Employer brands can be positive or negative. Employers with positive brands can more readily attract, high-quality candidates.
employment agreement: A contract between an employee and an employer that defines the rights and responsibilities of each. It typically covers issues like total compensation, job responsibilities, and authority, as well as start date, notice period, and severance. When both the employee and the employer agree to the terms, they sign the employee agreement.
engagement fee: The fee charged by a retained recruiter at the beginning of an executive search. Also called a front-end retainer.
executive recruiter: See recruiter.
executive search: The process of identifying, assessing, and recruiting high-level candidates for leadership positions.
external candidate: Anyone being considered for a position who does not already work inside the organization.
fee: The price for conducting part or all of an executive search or recruiting project. Fees are usually based on results, time, materials, a percentage of the hired candidate’s total compensation, or a combination of these.
fit: The quality of the interaction between a prospective candidate and the executive(s) at the organization where he or she is being recruited.
front-end retainer: See engagement fee.
guarantee: A contractual assurance provided by an executive search firm to clients. Guarantees may include promises to replace a candidate who leaves his or her position for any reason within a certain period; to not target a client’s employees when conducting searches for other clients; or to not recruit employees from companies the client has special relationships with.
hands-off agreement: See off-limits agreement.
headhunter: A slang term for executive recruiter.
informal reference check: The process of confirming a candidate’s background and experience through sources other than those provided by the candidate. These sources can include regulatory filings, online information, and (most important) conversations with former colleagues, supervisors, clients, vendors, and competitors. The informal reference check must be conducted delicately and confidentially so as not to jeopardize the candidate’s career or standing in the business community.
internal candidate: A person currently working within an organization who is being considered for a different position there.
interview: A meeting between a recruiter, hiring manager, or other company representative and a candidate being considered for a position.
job board: A website designed to connect active job seekers with employers with relevant job openings. Employers often maintain their own job boards in addition to using third-party ones. Job boards can be general or specific to an industry, function, or geographic location.
job description: An official document describing the skills and experience required for an open position.
job order: The formal specifications for an opening, including title, reporting relation- ships, skills required, education, desired experience, and existing relationships.
leadership pipeline: A sub-component of a succession plan. A leadership pipeline is used to identify and prepare top-performing employees for leadership roles.
LinkedIn: The world’s largest social networking tool for professionals.
long list: A list of candidates created in the early stages of a search engagement. See also short list.
non-compete clause: A clause in a contract under which one party (usually an employee) agrees not to enter into or start a company in competition with another party (usually the employer). Also called a restrictive covenant.
non-solicitation clause: A clause in a contract that restricts individuals or organizations from soliciting employees, customers, or business opportunities for a set period of time. Normally found in executive-level employment agreements.
off-limits agreement: An agreement that prevents a recruiter from targeting executives at one client company for employment at another company — in other words, putting them off-limits. The standard off-limits policy, outlined by the Association of Executive Search Consultants, stipulates that a search firm will not approach a company that it has worked for during the previous two years. Also known as a hands-off agreement.
onboarding: The process of assimilating a new hire into an organization. For top-level positions, this involves quickly deciphering the corporate culture and actual reporting structure and developing relationships with key people.
passive candidate: A person approached by a recruiter who is not looking for a new job.
phantom stock: A compensation plan that gives the holder of the phantom stock the right to receive a cash payment at a specific time or when a specific event occurs (such as the sale of the company) in the future. This payment is linked to the value of the com- pany’s real stock.
poaching: A slang term for recruiting high-value employees from another company, often competitors.
position profile: A detailed document that describes the ideal candidate, including key responsibilities and relationships. A marketing tool, the position profile is shared with prospective candidates to sell them on entering the search process.
proposal: A formal contract drawn up by the search firm, usually in the form of a letter agreement. It specifies key issues such as guarantees, timing, fees, exclusivity, confidenti- ality, and so on.
prospect: Someone the recruiter thinks might be successful in the role he or she is attempting to fill and who has shown some initial interest. See also suspect.
psychological testing: The administration of psychological tests to gain an objective overview of a candidate’s character, strengths, weaknesses, and working style. Typically used as one component of a wider, integrated evaluation strategy.
recruiter: A person who fills job openings. A recruiter’s job includes reviewing each candidate’s job experiences, negotiating salaries, and placing candidates in amenable positions. Also known as a headhunter.
recruiting firm: A specialized management consulting firm that conducts executive searches.
recruitment advertising: Specialized advertising designed to promote a job opening and entice job seekers to apply.
reference check: A systematic and methodical investigation into a candidate’s past job performance based on conversations with people who have worked with him or her. Like an employment interview, reference checking is most effective when it is thoughtfully integrated into the hiring process.
references: People who have worked with a candidate and can verify their personal and professional background, skills, character, and so on.
referred candidate: A person referred for consideration by someone familiar with the hiring organization.
relocation package: Payments made by the employer to a candidate who is being asked to relocate to assume a new position.
replacement guarantee: A promise to replace hired candidates who leave their positions within a certain period — usually between 3 and 12 months.
requirement: A necessary quality or qualification. This might include a particular skill requirement, level of experience, or personal characteristic.
research: In executive search, the investigative process of sourcing people who may become qualified candidates for an open position. Research is an ongoing (and time- consuming) effort for most executive recruiters.
restricted stock: A compensation plan that gives the holder of the restricted stock the right to sell stock only after it has vested.
restrictive covenant: See non-compete clause.
résumé: A document prepared by a job seeker to describe his or her background and skills. Résumés are used for a variety of reasons, but most often to secure new employ- ment. Résumés are similar to CVs, but CVs are more detailed.
retainer: A fee paid upfront to the recruiter by the client. Executive search retainers are usually paid in monthly installments over an agreed-upon period.
retained search: A search conducted by a recruiter who receives a retainer upfront. Retained searches are generally used only for positions that pay $150,000 or more. This payment model is similar to those used by other highly skilled professionals, such as architects, accountants, lawyers, and so on.
ruse: An action intended to deceive. Inexperienced recruiters or researchers may use ruses to obtain sensitive information. This practice is highly unethical.
screening interview: A job interview done to determine whether the applicant is qualified for a particular job. This interview is typically the first one in the hiring process. It can be done over the phone or in person.
search committee: A group of people formed for purposes of helping the hiring manager recruit and screen candidates for an executive position.
search committee chair: The person responsible for managing a proactive, timely, fair, and legal search process to find and hire an executive.
search committee interview: An interview in which members of the search committee — either as a group or one-on-one — assess the candidate.
search process: A series of predefined and interrelated processes used in an executive search to locate, evaluate, and attract the best executive for a job.
search research: A systematic search for information about specific industries, organizations, and executives to dispassionately interpret events. It is an essential component to developing an executive search strategy.
short list: The list of candidates created in the final stages of a search engagement, after candidates have been prescreened, interviewed, and vetted before being presented to the client. See also long list.
signing bonus: A payment made to a candidate upon his or her joining the organization. This payment, normally in the form of cash or equity, is often used to compensate executives for any cash or equity they might lose by leaving their current employers. It’s also used as a gesture of goodwill to thank an executive for agreeing to leave his or her current position for the new one.
situational interviewing: An interview technique in which the interviewer uses the job description to make a list of required skills and responsibilities and then poses questions about hypothetical situations that pertain to those skills and responsibilities. Candidates are assessed by how they would solve problems and exploit opportunities. Questions such as “How would you deal with . . . ?,” and “What would you do if . . . ?” are situational interview questions. Most hiring managers consider them very useful for executive candidates.
social recruiting: A type of recruiting that involves the use of social platforms as talent databases or for advertising. Popular social media sites used for recruiting include LinkedIn, Twitter, and Facebook.
sourcing: The act of proactively searching for qualified job candidates for a current or future open position. This stands in contrast to the reactive reviewing of résumés or applications submitted to a company. The point of sourcing is to collect data about qualified candidates, such as names, titles, and job responsibilities. Typically performed by an HR professional, sourcing is used to identify both active and passive job seekers. Sourcing is typically done via phone or Internet.
SOW: See statement of work.
staffing firm: A firm that focuses on providing temporary help or contract workers to clients for fixed periods.
statement of work (SOW): A formal agreement that captures the work products and services to be completed. These include (but are not limited to) work activities and deliverables to be supplied under a contract or as part of a project timeline.
stick rate: The percentage of recruited and placed candidates who remain in their positions through the guarantee period.
stock option: An agreement between two parties — in this case, the company and the new hire — that gives the new hire the right (but not the obligation) to purchase stock in the company at an agreed-upon (and perhaps discounted) price within a specific period of time.
stress interviewing: An interview technique designed to see how candidates react under pressure.
succession plan: A plan to address the selection, development, evaluation, and compensation of the executive team. The creation of the succession plan requires major input from the board of directors.
suspect: Someone the recruiter thinks is qualified to fill a search assignment, but whose suitability has not yet been confirmed. See also prospect.
talent mapping: The process of building an intelligence chart for a given organization or industry. Talent mapping involves identifying the names, titles, responsibilities, and accomplishments of people in companies in the targeted industry who may be qualified for a position, either now or in the future. See also candidate universe.
total compensation: The monetary value of the complete compensation package. Total compensation goes beyond base salary to account for all monetary and nonmonetary instruments. These may include a signing bonus; an annual bonus; a long-term incentive plan; profit-sharing; a phantom share, restricted share, or stock option plan; health insurance; life and disability insurance; a pension plan; private school fees for children; accommodations; club memberships; housing allowance or loans; and so on.
vesting: The process by which an employee accrues non-forfeit-able rights over employer- provided stock incentives or employer contributions made to the employee’s qualified retirement plan account or pension plan.