Few other industries polarize perceptions about value as much as retained executive search. The industry has been around for over 60 years and is in a constant state of flux; its value is perceived differently by mature and emerging markets, by clients who run multinational corporations, mid and sometimes even small sized companies and of course by executives who inevitably get into contact with search firms.

The search guys themselves represent a broad variety, from top tier global search firms, through successful sector and/or geographical niche players to recruiting companies who are trying to go “upmarket”, or even one man operations. Since barriers of entry are low, the industry attracts both highly professional elite players and opportunistic survivors who just want to “make a quick buck”.

Here we’d like to take a quick look only at one aspect of the executive search business and attempt to provide some perspective to it: pricing.

No matter what market we look at pricing is an “either or issue”: either high or not. High is easier to define, although it varies depending on whether we look at mature, emerging or young markets.

In mature markets high price may mean 200-300K and up (in dollars or euros). In emerging markets high maybe 60-100K +. The high price is typically in proportion to the salary level of the position to be filled.

There are special cases where we talk about prestige rates; these are well known cases where the search fee is $1M or close.

How a search is priced in the “not high” category (good, average, low) is relatively well known and thus not so interesting here.

Pricing is typically determined by the :

- the client

- the search firm

- the market (including level of position in question)

High pricing is fundamentally determined by the client and the search firm and of course: by the search consultant.

What makes the question of high-pricing in search interesting, is that in a way it’s an anomaly. Conventionally, in most industries, price is something that’s being talked down (in context of optimization and other frameworks). Exceptions are areas where perception (premium luxury brands, real estate, etc.) time (wine, vintage furniture, etc.) and real and company related political considerations play a role.

The real anomaly and thus the real interesting phenomena is when the high price is determined by pure principles that bind the client and the search consultant. Pure principles means that no or minimal quantitative considerations are present.

The client and the search consultant connect outside, in a way above the business domain. Not only do they view the principles of supremacy, elitism and control similarly, but because they actualize such principles to a similar degree in themselves, they actually live in a reality determined by such principles. The reality of values is rooted in principles; without operating in such a principle-based reality, articulated values are hollow, and always compromised. Values such as honesty, integrity, fairness, tolerance, etc. are all illusions without the underlying principles. Style elements like empathy, kindness, opennes, etc. all lack consistency, and may easily transform to hostility, aggression and stubbornness once conditions change.

People who give meaning to supremacy, elitism and control possess a position of power that is not situational (not rewarded) and they attract others whose orientation is similar, while naturally repelling those, whose orientation points in the opposite direction (opportunistic, populistic, highly rational, but hardly intellectual).

If the client and the search consultant operate in realities that are based on true principles, the hierarchical reality of principles/values/qualities is established, and the price reflects the true quality of the time the engagement demands from the search consultant, the client and the leader who will be attracted into such an organization. Since quality time is priceless, no matter how high the search fee, the price is always nominal and symbological.

There is no leadership in compromising on principles and values and there is of course no leaderhsip in subordinating qualitative to quantitative considerations.