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Central Europe Executive Search Market Outlook 2022/23

06. Dezember 2022

This report calls on IIC Partners search consultants from five countries in Central Europe (Germany, Austria, Switzerland, Czech Republic, and Slovakia) to discuss the executive search industry outlook, along with other HR trends.

Download the full report >

INTRODUCTION

by Christine Hayward, Executive Director, IIC Partners

The executive search industry has been extremely strong over the last two years. After the initial shock of the pandemic, organizations looked to grow and recover, and they needed executive talent with new skills to lead the way. This led to a ‘war for talent’ and salaries increased dramatically.

We are now approaching a period of increased economic uncertainty and rapid growth has begun to slow. However, as you will see in this report, the outlook is highly variable: some markets, industries, and roles are still on ascending paths of growth. We also see an increase in demand for interim management and coaching services.

Another key trend is the shift towards an ’employee market’ where high competition for talent has led to employers being more flexible and offering benefits such as 100% remote working and 4-day workweeks. If competition for talent slows, there could be a rebalancing of power. Yet, we are confident that many improvements to working life are here to stay.

Executive search firms are renowned for helping organizations navigate shifting market conditions by hiring and developing the right talent at the right time. We look forward to assisting our clients in the coming months and please contact our consultants to discuss any topics raised.

CONTRIBUTORS

CONTENTS

01. Current Demand for Executive Search Services
02. Industries and Functions in High Demand
03. How Executive Compensation is Changing
04. Additional HR Trends
05. 2023 Outlook for the Executive Search Market

How strong is the current demand for executive search services?

Germany

Marlière & Gerstlauer: The demand for search services is decreasing as employers prepare for a potential recession. However, there is still strong demand for smaller positions below an annual salary of 85K EUR. Large organizations are trying to complete searches first with in-house resources before engaging a search firm.

Ingeniam: In MedTech, Pharma, and Biotech there is high demand up to the Director/VP level to fill the retirement wave of baby boomers. There is also strong demand for transformation managers to help fill the post-pandemic supply shortage.

Austria

Eblinger & Partner: The demand for search services is high: not just for the senior level, where headhunters have always been requested, but also for mid-management and specialists. Even blue-collar positions and entry-level positions are hard to fill. Managers are desperate and ask us (by mistake) for help. As an executive search firm, we recommend contingency recruiting agencies for these lower-level positions.

Switzerland

Level Consulting: The demand for search services remains strong as Switzerland continues to be in a growth market: 2% according to the Swiss State Secretariat for Economic Affairs and the inflation rate of 3% is low compared to other European countries. The shortage of skilled workers has been observed for some time, especially in healthcare, IT, industrial, and finance, and is leading to high demand for executive search as well as interim management solutions.

Czech Republic and Slovakia

Teamconsult: There is an above-average demand for executive search services in Slovakia, especially at the top management level. In the Czech Republic, the demand is more on an average level, mostly focusing on senior specialist and mid-management positions.

Which industries and functions are most in demand?

Germany

Marlière & Gerstlauer: Branch managers, middle management, and plant managers in the industrial sector are currently in high demand.

Ingeniam: In MedTech, Pharma, and Biotech, the functions most in demand are marketing and sales, business development, and research and development. However, successful candidates must show experience in transformation.

Austria

Eblinger & Partner: Finance and IT positions are most in demand and very hard to fill.

Switzerland

Level Consulting: The industries and functions most in demand are Healthcare (Board, C-Suite, medical staff), IT (CIO, Head Digital Officer, IT project leaders), Finance, and Industrial (digitalization, quality management, and sales). Across industries, we are seeing more demand for Head of HR/Business Partner positions and for roles that manage compensation and benefits and digitalization in HR, which requires new skills. There is also an increasing demand for interim management.

Czech Republic and Slovakia

Teamconsult: There is strong demand from the professional services industry in the Czech Republic and Slovakia, especially for senior lawyers and tax advisors. Manufacturing companies are looking for supply chain and quality managers, as well as plant managers and CEOs.

How are salaries changing in our markets?

Germany

Marlière & Gerstlauer: Salaries have risen significantly across all sectors. But for some time now, we have seen this trend stagnating due to companies attempting to slow the continual rise. Despite this situation, candidates are demanding higher and higher salaries due to the current inflation. This naturally impacts passive candidates’ willingness to change roles if employers cannot meet their expectations.

Ingeniam: There is a substantial increase in middle management salaries. However, we are also hearing from many job seekers who would love to sacrifice part of their salary for more freedom and work-life balance.

Austria

Eblinger & Partner: Salary expectations are increasing, and for positions in high demand, we are seeing increases of up to 40%. High competition for talent is providing candidates with multiple competing offers, and there seems to be no limit to requests for higher compensation. Secondly, there appears to be a generational shift where Gen Y and Z are very confident in asking for higher income or 4-day workweeks for the same salary.

Switzerland

Level Consulting: In general, salary increases due to inflation have become very common and a tight market for talent is boosting salary expectations. We expect this to peak in the first half of 2023. In healthcare, non-medical management positions have been on a continual upward trend due to backlog demand, which is now flattening.

Czech Republic and Slovakia

Teamconsult: Salaries in the second quarter of 2022 in the Czech Republic rose by 4.4%, but real wages dropped in the same period by 10% due to inflation. Inflation has continued to grow and reached 17% in September. Pressure on employers to further increase salaries is therefore very high.

What are some other HR trends we are seeing?

Germany

Marlière & Gerstlauer: Employees want more free time with the same salary and are increasingly demanding permanent 100% remote working, as is common in the IT sector.

Ingeniam: In MedTech, Pharma, and Biotech, HR teams are increasingly using Recruitment Process Outsourcing (RPO) for middle management positions, and there is a higher demand for interim management.

Austria

Eblinger & Partner: There is an increase in positions that offer 4-day workweeks for the same salary as 5 days, and there are more 100% remote roles.

Switzerland

Level Consulting: The development of an employee market continues, and companies must consider how they can remain attractive to applicants and stand out. That includes more flexible working models in less rigid structures, remote work, 4-day weeks, and working in project organizations.

Czech Republic and Slovakia

Teamconsult: There is more demand for coaching services, including for employees below the top management level. Companies are hiring for more project-related positions, offering only limited contracts, and interim management is in high demand. Remote working has become standard practice after the pandemic.

What is the search market outlook for 2023?

Germany

Marlière & Gerstlauer: We see continued demand for smaller positions while demand for c-suite and senior management will decline. And should a recession occur, we will see a decrease in vacant jobs. In addition, both candidates and clients are becoming more selective in their requirements, making it harder to complete searches.

Ingeniam: Very high demand for people who do the groundwork (blue collar) and a restrained market for Management and C-level positions if economic and geopolitical circumstances do not improve.

Austria

Eblinger & Partner: We expect the search market to continue to be in high demand as there is no solution on the horizon to increase the number of participants in the labor market. Only a recession could decrease the number of vacant jobs.

Switzerland

Level Consulting: We expect the demand for search services to remain high and the shortage of skilled workers to become more acute. Furthermore, digitization and other triggers for transformation lead to more complex skillsets and candidates are expected to have a large intersection of technological and people management skills. In addition, clients are seeking more diversity and gender equity at the executive level. As a result, they require a better representation of women in candidate pipelines. Demand for career coaching services and interim management solutions continues to increase.

Czech Republic and Slovakia

Teamconsult: For the last ten years, companies have searched for managers to handle growth and increased demand. For at least the next two years, we expect a different type of manager to be in demand: budget control, cost-cutting, and restructuring will be the new key qualifications on a manager’s CV.

CONTRIBUTORS

ABOUT IIC PARTNERS

IIC Partners is a top ten global executive search organization. All IIC Partners member firms are independently owned and managed and are leaders in local markets, developing solutions for their client’s organizational leadership and talent management requirements.

Are job ads dead?

07. November 2022

By Stephan Breitfeld 

We are fortunate to navigate an industry of major growth! So far so good. Growth, innovation and disruption call for a great number of talented people and some fine leadership to be able to keep up. And you might have noticed, times are changing. The job market is not an easy beast to tame, nor is it a calm pond, where every swing of a fishing rod gets you the exact fish you need. The process involves sifting through multitudes of candidates in order to understand thoroughly where objectives and expectations of both – a client and a candidate – align. It means identifying, targeting, assessing, and approaching candidates in the market directly and individually, to fulfill the very mission a company sets for itself. It’s about answering individual needs of every client with surgical precision taking a holistic approach to their benefit.

Times where you put out a job ad, got hundreds of applications and people going above and beyond to get the job are over. I hate to break it to you.

CV engines and networking platforms?

Perhaps not the best way of finding candidates: there is far more beyond professional credentials and nicely arranged descriptions of oneself. It’s rather about establishing trustful human communication. There is no other way of getting to know your candidates if not through direct conversation. This adds up to learning about candidates’ soft skills and identifying whether they can become a good cultural fit to the company. It’s not about a new job opportunity per se, but rather about personal matters of psychological domain that can impact working behavior resulting in success or failure. At the end of the day, what counts most is the feeling of a purposeful discussion, whatever the outcome is.

Investment for the future

It’s important to keep in mind that by approaching candidates directly you ultimately invest, nurture, and strengthen your network. No doubt, having a few hundreds of great CVs (that you got sent over to, because of an “We’re hiring” ad you’d posted yesterday) is terrific. But does it actually mean anything, if you haven’t had a direct conversation with any of them even once? Spoiler alert! Not really. The right way is to approach candidates directly to get to know them beyond their credentials and technical expertise – exactly what company like ours does. You want your candidates to be full-fledged profiles instead of mere lists of names and CVs.

So, what does it leave us with? You only benefit from direct approach when hunting for talent. Every company has their individual goals and visions, so do candidates. Finding where those interlink and how both can benefit from each other can only be uncovered through direct discussion. Not only does it allow you to complete a candidate’s profile with all its diverse aspects, but it also allows it include this profile to your network in case the initial company doesn’t find them fit for a position – something job ads fall short at.

Sorry job ads, maybe some other time or in a different setting.

more…>

Life Sciences & Healthcare 2022 Trends Survey

12. Oktober 2022

By Stephan Breitfeld 

Take a look at our Life Sciences & Healthcare 2022 Trends Survey on remote working and hiring practices: https://lnkd.in/dnyV5W9d.

The colossal rise of remote working over the past two years has dramatically changed business operations and hiring practices.

But how has this trend impacted the Life Sciences and Healthcare industries? We decided to investigate by surveying over 200 C-suite leaders and senior HR professionals in these sectors.

more…>

Taking a stroll with my customer avatar

Taking a stroll with my customer avatar

26. September 2022

By Stephan Breitfeld 

Whoever has been dealing with storytelling in the context of strategic communication, has probably been introduced to the customer avatar. The ideal customer, the one person that represents the mass of people you want and need to talk to. Whatever need it is you’re addressing, it can be the ideal candidate, the perfect visitor to your store, the one person that really needs your product, the avatar is that in one person.

It may seem a bit odd to assimilate a vast number of people in one Steven, Christian or Beth to the address, but it also has something of a calming notion that so many people have the exact same problem, need, feeling and desire.

The problems we share

In the executive search industry, the problems of potential customers can differ a lot in detail, but they also have a lot in common when it comes to the root of the problems. The customer avatar has difficulties with demands and reality of today’s candidate market. Difficulties finding the right executive candidates, a fear of leaving positions unfilled, excessive pressure on the existing team, products not entering the market, quality management not living up, global distribution being stalled, etc.

The customer avatar has a lot of difficult conversations with colleagues and superiors, why it’s not working, why the candidates don’t fit. There is a lack of understanding why the tools don’t work, why the salary expectations differ so much from what the company can offer. The generation “Work Life Balance” meets the demographic decline of the baby boomers. There you go.

We get each other

That’s not a specific problem of the industry, it’s a problem literally EVERYBODY has. While that may be a bit comforting, that we essentially are not alone with our problems, it still doesn’t solve them. Building up recruiting inhouse often lacks specialized and experiences approached that are even more necessary in a touch market. Candidates don’t work or look the same anymore. The dream job might no longer be engineer at Porsche but influencer at You Tube. And: yeah, job ads, forget it!

I feel for my customer avatar. These are no easy issues. Important people quit or go into retirement, on top the company needs to “transform” towards new products and services to meet current needs. It becomes overbearing. No people anywhere in sight. And also: no quick fix.

Stay strong and stick it out

But there is hope for the customer avatar. It goes through vision, ideas and long-term solutions. Approaches need to be re-evaluated and an external eye is almost always helpful. Letting go of the problem and handing it over can be very rewarding. There are people with more experience, more knowledge and know-how and the tools to find the missing pieces. Long-lasting relationships with experts can be just what the customer avatar needs. To focus on the company and the ability to innovate and develop for the future.

more…>

What comes after the great resignation? A service-free-zone?

16. August 2022

By Stephan Breitfeld 

I’m sure you’ve heard some talk about the severe talent shortage and its consequences in basically all industries. Just recently you could easily observe it compressed in the situations at the airports. Not enough staff anywhere to remotely conquer the task of having as many travelers on their way into summer vacation as there were. How are you supposed to handle all the bags, when there are not enough people to pick them up, carry them around, deliver them. How are you supposed to have planes on time or take off at all when there are not enough pilots to fly them, ground personnel to guide them, flight attendants to work on board?

This is how a lot of business owners feel these days. The assignments are there, the Covid-crisis is basically over on that front but what to do when there are not enough people to do the work? Plus: the existing staff is constantly overworked and even more people quit! Looking around, this is an overwhelmingly big problem.

Short-term solutions

Yes, to quickly stuff some holes, you can try and quickly hire new people. But, as previously mentioned, that is a much harder task than it used to be due to a severe lack of people. Not only qualified people but people in general. What also happens a lot is that less people take on more work to cover the workload. So, C-Suite people end up helping out with excel lists and standard tasks, or – to use the airport example above – the CEO of Lufthansa (who’s a trained pilot) would go down and fly planes and actually, in the air, use the autopilot and hand out some blankets and afterwards unload the baggage and drive it to the belt.

Another short-term solution is to drop clients or cancel assignments. Yes, that hurts. Especially after the Covid-crisis it seems somewhat risky to not “work in” some of the losses during that period. But again: no people, no work being done. But this question of how to conduct business further on brings us to the next chapter: What needs to change long-term?

Long-term solutions

When you look at the long-term effects, there is surely a change due in terms of how we work. Because the talent shortage isn’t going to significantly improve, there are just too many (shitty) jobs for too little people. And the candidates have all the choice in the world. What used to be a sentence from employers – “you’re in the closer selection” – is now a sentence from candidates. This may be frustrating for employers but it’s the reality. We need to deal with it.

The quality and structure of work needs to change, the relationship between management and staff needs to change and there is a big need for work to fit the individual better. And ideally everyone profits from this. Change is hard but it needs to happen. Working conditions that have existed for centuries are changing dramatically for all participants. Existing jobs are disappearing. But does that need to be bad?

Any hope?

Yes, it’s hard to be hopeful when work mounts, people quit and burn-out becomes an epidemic that is hard to handle. But – in the spirit of “it needs to get worse before it can get better” – the fundamental shift might be necessary to prepare for better times. What are your hopes for what to get out of it. Do you think it’s going to be a service-free-zone? Or more an oasis of individual fulfillment?

You’re an executive? It’s likely you need to up your Social Media Game

29. Juni 2022

By Stephan Breitfeld 

Social media are fun! All those innumerous interesting articles from all sorts of know-it-all gurus, endless stunning photos of last night meals from breakthrough influencers, tons of memes that will make your belly hurt for how hard you laugh. Just pure joy in your stress-free life!

Let’s dial back the sarcasm and get to the point: you shouldn’t forget that social media have become one of the most powerful brand-building tools in the current day and age. Why? Because social media essentially offer dialogue directly with your audience. But not only that. Thanks to the LinkedIn (also a social media platform btw) research, we know that stunning 66% of professionals would be more likely to recommend a company or brand if they followed a company’s executive on social media.

Exactly! It’s time to set up an account… But first, let’s take a deep breath and look at what we need to consider to bring your social media game to the next level.

Ready? Engage! 

Social media offer a great opportunity to interact directly with your audience, position yourself as an expert and, as a result, drive business value. This is one of the best ways to gain industry exposure, build engagement and establish trust with your target audience. According to the LinkedIn study I referenced before, 56% of professionals say a business executive’s presence on social media positively influences their purchase decision. In other words, the more recognizable you are on social media, the more likely you are to get new clients.

Strategic thinking 

A company without a strategy is like a ship without a map – no one knows where you’re steering. Same goes for social media. It requires a strategy to make it clear what your priorities and goals are, and how you are going to get there. Some of the key questions you should ask yourself are:

“Who do I want/need to talk to?”

“What do I want to say?”

“Where do I need to be in order to talk to these people about these things?”

“What do I want people to do?”

“How much recourses am I ready to invest in it?”

Now, incorporate the topics you want to address in your profile bio to let your existing and potential followers know what to expect; follow relevant accounts and hashtags; get involved in trending conversations and leave comments based on your expertise and experience. That’s a good start and you can see what works for you.

Finally, and perhaps most importantly, you MUST take your social media presence seriously. Since it has a direct impact on your company’s recognizability and, eventually, performance (more reach = more potential clients, remember?), avoid falling into a trap of “I’ve posted like 5 pictures, but no one is following me! Social media don’t work!”. For social media to work in your favor you must stay consistent and plan your campaign a few months in advance. Moreover, you must prioritize authenticity to build trust with your audiences.

If you’re not confident in your social media skills or your ability to devote the time required to do it right, consider enlisting some help. Assigning an executive social media strategy to a trusted expert, like a social media marketing or a PR team, can help you with that in a much better way, than a freshly recruited intern.

Is digital leadership a skillset or a mindset?

18. Mai 2022

By Stephan Breitfeld 

The digital transformation is a topic that’s been with us for a long time and it’s quite clear by now that there is no way around it. But companies keep on struggling with it especially when it comes to the fact that it’s a constant transformation that never stops. A transformation that effects all aspects of a company and makes for a whole new working environment and relationships between colleagues and to customers. The constant and ongoing transformation calls for leadership that is agile and able to adapt and keep up with all the changes. Sounds nerve-wrecking, doesn’t it? 

No digital transformation without a digital leader

A quite decisive element for conquest or failure of digital transformation processes is the digital leader who steers the change in the company. And not surprisingly: real digital leaders are in high demand. Because – as said above – every company basically needs them. Digital transformation requires a comprehensive and holistic look at the company. It’s not about changing processes here and there, introducing cloud solutions, etc. It’s about changing culture, it’s about introducing concepts that drive innovation and change, networking against traditional hierarchies, allowing personal growth and making mistakes. It’s about a real transformation.

What’s a good digital leader?

Real good digital leaders have a variety of qualities and the fact that they need to be agile leaders in transformation processes calls into question whether there even is a definition for it, but there are certain traits that can help identify digital leadership qualities:Flexibility

Agility

Active and open leadership

Curiosity

Digital mindset

People Skills

Data knowledge

Vision

Of course, any combination of the above traits can work really well. It’s about incorporating the skills more into a mindset. It’s not as important to have the technical skills than to understand the technology as a process. The skill is not to know how the software works, the skill is what the software can and will do for the company, what role it will play and who needs to be a part of it.

Where to find them 

Yes, and then comes the big question: where to find people with this mindset? Of course, there is no one answer to this and they for sure aren’t easily found. In a way the traits of a digital leader also apply to the searching process: it needs to be flexible, agile, open, knowledgeable and willing to look beyond the traditional concepts. Know what you’re looking for and be open to find candidates in an entirely different place than expected. And get someone good to help you with this! 😉

“What are your salary expectations?” – and the answer

25. April 2022

By Stephan Breitfeld 

A thriving industry is generally good news. Especially if it is as thriving as the Life Sciences are right now. Taking some of the general developments during the pandemic into account, we’re facing a vast number of positions, an exceptional growth that wants to be fulfilled. And the good news (and kind of bad news at the same time): salaries are on the rise as well!

The sky is the limit – isn’t it?

With the ever-growing demand for talent and an overall growing industry, it’s also good times for executive search consultants like myself. The high-level positions that need to be filled seem endless. What also comes with the demand is a rising level of salary expectations and that can be difficult to handle. The payment expectations have skyrocketed since the pandemic and cause a growing dissonance with what the employer is willing to pay for the respective positions.

Just the pure fact that the salary expectations for a position can be six figures apart makes for a sensitive situation. Of course, talent sees themselves confronted with a number of opportunities and an omnipresent tenor of need, but talent still needs to match with an employer in the end.

Expectation management

In comes the glorious phrase “expectations management” and the manager for this, being me. But it’s incredibly important to approach this topic right and with the right sensitivity. Because a candidate who asks for way more money isn’t necessarily the one who is greedy and needs to tone it down – and even if he/she is, can’t be regarded as unreasonable – but needs to be heard and taken seriously. At the same time an employer can simply be completely off with their expected pay and, in case of a rise, wants to hire the jack of all trades. Sometimes they need to meet in the middle, sometimes somewhere else. In all cases it helps to be prepared.

Transparency – talk money and do it right. Don’t shy away from the uncomfortable money talk. The more you are clear and authentic about your values in your compensation, the better you will match with the candidate.

Consistency – keep your word and stay true to what you value about salaries. Make it understandable and fair across your company. Have a budget and keep the individual in mind.

Strategy – make up your mind and have an overall plan for your company. How are salaries developing? What are the factors that contribute to increase and promotion? Benchmark your pay regularly.

Focus – make sure you set the right priorities when it comes to compensation and make clear what it consists of apart from money. Money is not everything and that goes both ways. Focus on respectful and meaningful relationships.

If this is a field you struggle with, there is always the help of a professional – just a phone call away. Get in touch!

www.ingeniam.de

It’s going well for Biotech – how to keep up with the growth

21. März 2022

By Stephan Breitfeld 

Looking back at recent developments in Biotech – through a global pandemic – investments and innovation increased significantly, companies saw continued growth, share prices skyrocketed, and overall business has been great. Some have expressed that these developments even rendered Life Sciences one of the most stable growth areas worldwide. In a recent whitepaper that I contributed to together with colleagues for IIC Partners (read here) we conclude that such an environment of rapid growth has already attracted extremely qualified personnel to the sector and is signaling the need for more. There are several areas marked by experts as especially promising. What are those areas and what kind of workforce can make them bloom?

Open up to international talent

Being relatively new and rapidly growing industries, biotech and medtech are struggling with a very acute problem: skills development can hardly keep up with growth. This, in turn, leads to competition among recruiters for the best and/or qualified talent locally as well as globally – there is only so much suitable workforce in the whole world. In this circumstances, internationalization of the entire industry is imminent, and according to Jörg Trinkwalter (CEO of Medical Valley EMN e.V ) “it actually will not work without international specialists.”

Luckily, COVID-19 not only opened a new dimension of working ‘virtually’, but it also proved that this is very much possible and even desirable in some instances to look for more international talent. That means there is no need to shy away from hiring the internationals, even if they can only work remotely: every expert is way too valuable in the current battle for international talent. Diverse international teams and leaders who can nurture and maintain diversity have become the backbone of a successful company.

Open up for your tech skills

Technological development thrives right on the border of disciplines (well, it’s even in the word ‘biotech’ itself) and there’s a requirement for specialists right where the disciplines meet. Unfortunately, there’s a considerable deficit of specialists such as data scientists or medical IT specialists. With that in mind, it’s advisable to look for candidates who are fit for the job and can work in your team (personality matters the most!), instead of becoming obsessed with the track records and decades of experience. Talent has a remarkable ability to grow, and, therefore, lowering the bar of requirements to qualify for a job can be useful in a long-term perspective (Big Data, for example, is also a relatively new phenomenon). Furthermore, there is a large chunk of experienced workforce over 55 who lack digital skills, so upgrading them by launching a digital Re-training program can open new interdisciplinary opportunities within a company.

Dedication for talent and the right partner

Another aspect of recruiting the best talent is planning ahead. Look at the bigger picture: recruiting is an integral part of your company’s development and thus it needs to be regarded as such. Michele Porreca (Chief People Officer, Prelude Therapeutics) suggests moving the recruitment agenda from a discussion primarily about budget to discussion about organizational development instead, also pointing out that “talent acquisition is top of mind with the need to balance speed with getting the right people in the door.”

With all its positive effects, growth in biotech and medtech industries need more qualified talent to sustain it. Yes, it’s challenging, but manageable. When looking for suitable candidates, it’s wiser to prioritize not (only) the complexity of their CVs with all the revolutionary publications and decades of experience in a particular field, but whether they can fit in the team, no matter where they are located. Work with a trusted partner who knows their way around Biotech. The industry is new, talent will grow with it. As long as there is balance between experience, diversity and flexibility – those teams will excel!

Read the whitepaper this article is based on here.


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