The Talent War Takes Off

I had the window seat on the plane from JFK to Dallas. Not optimal. Aisle is optimal for bathroom visits and for stretching, but anything beats the middle seat, so I was pleased.
The guy next to me was a talker. He was, I gathered, the CEO of a small biotech firm in New England that was developing the ‘Lorenzo’s Oil’ of the decade. When the woman he was addressing mentioned that she had heard the buzzword ‘biotech’ a lot but didn’t know what it meant, he looked stricken, turned to her, and with profound gravitas said: “Biology will be to the 21st century what information was to the 20th century.”

I smiled. He was clearly expecting applause. Then he heaved a sigh and said: “But we can’t find the people to hire.” I smiled again. I’m a CEO too. I run one of the country’s largest headhunting firms that specializes in biotech, CRO services and pharma search work. It was time to go to work.

I introduced myself, made a mental note that this is why I fly first class, and proceeded to drill down. I explained to him that he was not alone. His competition was also finding their growth plans thwarted, not by lack of opportunity, but by a dearth of talent. “But why?” he wondered. “Just a couple of years ago I could interview four quality people for every job in a week’s time. I didn’t even have to pay people like you a fee – no offense.”

I assured him times had indeed changed. The normal laws of supply and demand and economic cycles, which have long determined employment levels and therefore recruiting strategies, have been thrown over for a more powerful driving force: demographics.

It is demographics that drive the current candidate-centric marketplace, and it won’t change – regardless of inflation, interest rates or cataclysmic events like 9/11 or Katrina – for nearly another decade. What’s going on? Well, the baby boomers are slowly going ‘gently into that good night’. The oldest baby boomers have just turned 60 and started to retire. There were 78 million people born between 1946 and 1964 as our fathers came back from war and stormed their wives like they did Normandy. They were the best-educated generation. They became the wealthiest generation in history, and their achievements and influence have been magnificent. What they didn’t have were many children. The next generation, born between 1964 and 1980 and whom Copeland forever labeled Generation X in his book of the same name, numbered only 28 million and had a very different idea of what life should be about.

America is a youth culture. The biotech and pharma workplaces are no different. Given our druthers, we’d hire people with 7-15 years experience. These people tend to be 28-38 years old. When headhunters send in younger folk, they are deemed not ready; when we send someone older, they get politely passed on. We legislate equality and age discrimination, but the youth culture is deeply etched and we simply keep interviewing.

The youngest boomer is 42 years old. Every day companies wait for the perfect candidate to come not from the 78 million person pool, but from the 28 million person pool. They advertise and get a weak response; they post their jobs on Monster, BioSpace and Careerbuilder and their HR department keeps recycling the same people. Why? Because they’re not out there!

In the book Impending Crisis, Roger Herman says that by 2010 there will be 10 million more jobs than there are people to fill them in the US. By comparison, in the halcyon days of the dotcom boom there were only four million more jobs than people.

To compete, biotech, CRO services companies and pharma must:

• Stop the bleeding by putting in retention programs to keep from losing more of their own.
• Accept that there is a war for talent and start competing by making hiring process about selling rather than the traditional ‘what can you do for us?’ mentality.
• Have a recruiting strategy that targets the ‘recruited candidate’, the one who is not looking for a job, has no resume and is only accessible via headhunters niched in a specialized area of work.

At my firm, we focus on business development talent. Revenue drivers. We do this from the senior rep level all the way up to the V and C levels. We are connected. Our lifeblood is our network, which is ever expanding and does not sleep. We are, in essence, who we know. In the 30 years we’ve been impacting the bottom lines of companies and the careers of candidates, we have taken a stealth approach.

A candidate you get from Hobson Associates has been ‘cold recruited’. We find out via our network who was excellent, not who is out of a job or available, and we approach that candidate and challenge them to consider a change that will potentially change their lives. We believe people are happier when they continue to grow and evolve. We recognize that fear of change is natural, and we help our candidates overcome these fears. We are very proud that the national average for offers turned down or placements rejected is nationally around 15 percent, and at our firm has historically been four percent.

We bring impact players with an agenda for growth to companies with compelling stories to sell, and we allow them to compete for each other. Our approach has always been successful, but given the demographics, it has become critical to our client’s success.

I wrapped up this heartfelt pitch just as the plane was landing, the belts were fastened and the tray tables put up and locked away. My companion and fellow CEO asked me to call him. He needs to hire a CMO.

Maybe he’s wrong. Maybe talent will be to the 21st century what information was to the 20th century. Or maybe, in an ideal world, talent will be to every century what it has been in every century: the most important asset any company will ever have.

 

Ask the expert
How to… recruit effectively

Patent expirations, rising R&D costs and a lack of blockbuster drugs in the pipeline: pressures on pharma executives have never been greater. So how can pharma firms ensure they’re recruiting the best and brightest management talent to see them through tough times? Hobson Associates’ Steve Soto explains…

Many pharmaceutical companies are really feeling the pinch. As if the lack of blockbuster drugs in the pipeline and the rising cost of research and development weren’t enough, Big Pharma and pharma services companies may be facing the biggest challenge of all – managing their employees.

Many of the top executives in large pharma are in their mid 50s and 60s, and soon these executives will be sailing into the great sunset of retirement. Big pharma and pharma services companies need to keep up with this enormous demand for talent, and need to implement mass hiring strategies – now. The executive level is no exception. Companies need to implement ‘onboarding’ strategies for mid-senior level talent, because the counter-offer from previous employers (which traditionally was made when the person resigned) is now happening 3-6 weeks after the person starts their new job – primarily to take advantage of poor onboarding processes. Better to go back to the devil you know than the devil you don’t. To counteract this, make them feel like part of ‘La Familia Nostro’.

Remember, headhunters like myself are continually going after and recruiting your executives, offering better pay, more stock options, company car, expense account, company penthouse in NYC – the works! It is no longer play fair in the sandbox… its Darwin’s theory of evolution: survival of the fittest. There’s no set of steak knives for second place.

I know what you’re thinking. I can get plenty of good people from Monster, Biospace, Careerbuilder or any job search board, and sometimes you can. On average though, only 2-4 percent of all jobs posted on these sites are filled, and if you find someone off one of the boards chances are they probably have more than 10 other things to consider… they are an HR person’s worst nightmare. The best talent is not combing the Sunday New York Times classified ads or looking on job boards to find a job.

Unfortunately, there’s no easy solution to this problem. The tides have changed, and it’s no longer a candidate-centric market. Long gone are the days when you had four or five ‘A’ candidates for one job. Candidates who are active have four or five different opportunities to choose from, one better than the other. Companies are throwing money at these candidates like its going out of style!

Big pharma and pharma services companies will now need to re-think how they once felt about working with headhunters. We are your eyes and ears in the ever-changing market of drug development. We are your strategic partner in the fight against the war of talent that’s about to explode. It is truly a jungle out there and having the right strategic recruiting partner can make all the difference.

That’s why retaining a professional recruiting firm like Hobson Associates in this kind of market is essential. The right recruiting firm can be the difference between securing the best talent on the market. We do this by formulating a game plan with our clients to get a 30-yard perspective of how the company works. Who are your biggest competitors? Who are the key decision-makers? What is your differentiator in the marketplace? How long has senior management been part of the organization? Questions that top executives ask when pursuing an opportunity and may not necessarily be represented on a job description.

Its your money, so remember this: it takes on average 8-10 years and at least US$600 million to bring a blockbuster drug to market. Clinical development losses are at US$6 billion dollars a year and seven out of 10 drugs never recoup costs. The ball is in your proverbial court; what you do with it is entirely up to you.