Blue Ocean Recruiting

Why is Japan such a tough market for companies to recruit in? Simple: the supply is limited but demand is constant. The factors limiting supply are talent (however, this is true in most markets), and bi-lingual and bi-cultural capability. Extrinsic motivators such as salary and stock options have less of a pull than other markets.

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This strong demand and limited supply mean that fees remain higher in Japan than in other markets. Often there is little difference between the fees of a local company and a retained global firm. The limited supply means that even the global firms are acting as contingency firms. A senior director at one US firm explained, “Yes, we market candidates (on a contingent basis) to our clients. We call it a short list of one.”

In Europe and America, recruiting companies focus on winning business from clients. In Japan the focus is on meeting, interviewing, and gaining the trust of candidates.

Some global firms have found it tough in Japan while others, RSA as an example, have held back from tackling the Land of the Rising Sun. The big US and EU firms bring a strong reputation; their consultants often come from industry and have a sound corporate understanding. They can strongly represent their clients to the market. So why haven’t these firms done as well in Japan as in other markets? One reason is that they sometimes over-promise and under-deliver: they can be “all hat and no cattle,” meaning that they look a million bucks but perhaps lack the candidate reach through the market to deliver. Clients can also be susceptible to the “bait and switch”, where the managing partner wins the business and the junior consultant executes the search. The big firms tend to be less sales-orientated and more consultative.

The thorn in the side of the global firms is the local contingency companies with their large candidate pools and focus on meeting candidates. Their mantra is, “He who meets the most candidates wins.” They are aggressive and sales-focused. On the negative side they do not always give a consistent message: the firms have a “churn and burn” strategy to hiring. If a junior works for a year and meets 200 candidates and leaves, then that is fine since the companies know they will recoup their investment over time by placing roughly 10 of those 200 candidates in the future. The local firms work for the candidate rather than the client. They shop their top candidates to one company against another. This approach has more in common with a sports agent than an executive search. Since these firms look to hire 20-somethings, their knowledge is limited, but over time many go on to become industry insiders.

At Morunda we have recognized that the market is in need of a middle ground—a firm that can offer clients a strong brand, market knowledge and the ability to map and understand the market with vigor and professionalism. At the same time, Japanese clients need a firm that can execute quickly and provide a deep reach into the candidate pool. Morunda has launched MorundaBlue, a retained search practice led by Michael Huberts. Michael previously held roles in investor relations within the UK’s private equity and communications consultancy industries. Highlights of his previous career include a GBP 150 million capital raise for a US private equity fund and financial PR advisory to Dentsu Group’s USD 5 billion acquisition of Aegis PLC. He received his Bachelor of Commerce degree from Monash University, Australia and his MBA from the University of Oxford, Saïd Business School.

 

Retained Global firms

 

 

Positives

 

 

Negatives

  • Strong reputation
  • Strong understanding of  Industry, corporate understanding
  • Able to represent your firm well
     
  • Over promise and under deliver
  • “All hat and no cattle” – They lack the network to deliver the search
  • Clients susceptible to “bait and switch”
  • Not sales-orientated

MorundaBlue

  • Strong reputation—active in the market since 2001
  • Strong industry knowledge— writing industry articles since 2006
  • Deep understanding of the industry— held industry events since 2007
  • Experience leading Global Executive Search projects in Europe, the US and Asia Pac (including Japan)
  • Met over 5000 candidates in the Japanese Pharmaceutical Industry
  • Strong sales focus

 

Morunda Asia

Talent Search

Morunda Blue

Retained Search

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