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The Economics of Everyday Things

85. Executive Recruiters

The Economics of Everyday Things

Freakonomics Network

Business

4.81.2K Ratings

🗓️ 24 March 2025

⏱️ 21 minutes

🧾️ Download transcript

Summary

When a Fortune 500 company needs a new leader, it turns to a well-connected headhunter who assesses candidates with psychological tests and mock TV interviews. Zachary Crockett activates his network.

Transcript

Click on a timestamp to play from that location

0:00.0

Imagine that you're on the board of directors at a Fortune 500 company, and the CEO just told

0:08.8

you she's going to step down. You have to find an experienced, charismatic, and operationally

0:15.3

astute successor, preferably one who knows the industry, and you only have a few months to pull it off.

0:22.9

But you can't exactly reach out to your competitors to see if they're interested in sending over some of their executive talent.

0:30.0

So you might decide to get a little help from an outside consultant, a professional headhunter.

0:39.0

Maybe a better term for us is, you know, unicorn hunters.

0:42.5

That's Julian Ha. He's a partner at the executive recruiting firm Hydric and Struggles.

0:48.6

We're out there looking for the purple unicorn. And then they say, well, we want a

0:53.7

polka-dotted purple one. I said, well, we want a poca dotted purple one.

0:55.0

I said, well, we have striped ones and we have square ones, but the polka dot one's going to be tough.

1:02.5

CEOs might not be mythical creatures, but they're certainly a rare breed. There are only a few

1:09.1

people who have the right qualifications to lead a multinational

1:12.8

corporation. And finding them is only one part of Ha's job. The executive search 20, 20, 30 years

1:21.8

ago was probably more based on your black book, right? Who did you know? Who's in your Rolodex? These days,

1:29.0

there's Google, there's LinkedIn, there's all these ways to find people. The value that we try

1:34.6

to add as an industry is the search, the selection, the filtering, the assessment, the referencing,

1:43.9

and then guiding our clients to help them hire their next

1:47.9

leader. For an executive recruiter, there's a lot on the line. If you find the right candidate,

1:54.3

you could earn a substantial payday for yourself. But one bad placement, and your client's stock

2:00.5

could take a nosedive.

2:06.8

One of the things that you become aware of in this work is that you're impacting millions of lives, not figuratively, literally.

2:15.2

The stakes are high.

...

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