Canadian Business Outlook 2021: A Focus on Executive Talent
2020 Has been a challenging year for the global Executive Search industry, and Canadian firms have not been spared from the significant downturns in business activity and sentiment due to the ongoing worldwide pandemic. Depending on the industry, the search industry has seen a decline by up to 80% for global, smaller boutique and regionally focused recruiting consultancies. A new U.S. administration, promising developments on the global vaccination front and business slowly getting back on track, are all positive signs pointing towards a slow but solid recovery lasting until the end of this year or early in 2022. Usually, the Canadian economy is lagging between two and four months behind the US market economy, and for this reason the US economy is being closely watched.
A Shifting Landscape
The impact of the pandemic has touched almost every part of every organization, resulting in the HR Departments once again being the centre of major business decisions. Not surprisingly, the operating model of businesses across the country had to transition to a functioning, remote-work model. What experts thought could take a few more years, suddenly happened in a matter of weeks. Many CEOs would agree that the single biggest driver of this profound change in their companies’ digital strategies, was the rapidly unfolding pandemic, rather than the clairvoyance of their IT Departments.
From an executive talent sourcing perspective, we also noted a variety of shifts in the behaviour and approach of hiring managers and candidates alike: Candidates became much more responsive, virtual meetings and interviews became the norm, hiring managers signed up new hires without personally meeting the finalist candidates, a reduction in the relocation packages being offered to candidates, and surprisingly, expedited search processes.
“We, like our clients, had to adapt to the rapidly changing landscape almost overnight. In a world where face-to-face candidate interviews and client meetings have been the norm since the dawn of the executive search industry, we have had to develop new tools and methods to conduct effective candidate interviews and provide equally accurate assessments of candidates to our clients. And we see this trend continuing well beyond the end of the pandemic as digitization of the industry and the world around us is accelerating”, said Jens Friedrich, CEO of SpenglerFox
The recovery of the Canadian economy and general business outlook undoubtedly depends on the course of the virus. General consensus however suggests a recovery over the next few months as the vaccination efforts accelerate, and also driven by an increase in consumer spending and exports, both of which are Canada’s growth engines. This means that more companies are expected to invest in talent again versus just trying to fill essential roles. The omnipresent skills gap which we have seen in multiple industries across a variety of functions didn’t close due to the pandemic, it simply just got put on hold. As organizations find and settle into their new operating model and slowly return to a more structured and seamless remote collaboration approach, they will still be in great need of talent, which will help to accelerate their transformation projects. This pandemic has certainly necessitated the importance of digital and technological transformation within many companies and across industries.
Succession planning and a significant leadership transition within the C-Suite of many organizations is expected to push the Executive Search industry into a more predictable and prosperous 2022. The future of many (if not most) organizations, and not just in Canada, will be shaped by a profound shift in corporate culture, which by definition implies a radically different leadership style which is much more adaptive to change, that fosters diversity and inclusion, rewrites the rule book and focusses on managing people more than just managing the business.
The travel, hospitality, energy and retail sectors have obviously been hit hard throughout the past year, and some industries are unlikely to get back to pre-pandemic levels for quite a while. On the other hand, industries like Private Equity, eCommerce, Logistics & Supply Chain, Software, Life Science (especially in digital and connected healthcare), Consumer and Financial Services, are prospering across the globe. In terms of roles, it remains to be seen what new skillsets and what new non-traditional roles will emerge from this. From our perspective, focus will be on a much more diversified Board, Digitization experts, CFO’s with downturn experience, Logistics and Supply Chain leaders and obviously multiple software technology-related roles such as Data Scientists, Data Analysts, Platform Services and Cloud Solution Managers. Perhaps the most prominent change has transpired in the Human Resources function, and for this reason this is the area where we also see a profound shift in role titles, responsibilities and skillset requirements.
The overall business outlook is intrinsically tied to the course of the virus and global vaccination efforts over the next few months. Notwithstanding, the outlook is cautiously optimistic, and yes, some industries may be slower in recovery than others. But it is our expectation that the executive job market will be experiencing somewhat of a renaissance this year as businesses have started focussing on rebuilding and retooling their executive leadership to prepare for a recovery.
SpenglerFox is a Global Talent Consultancy working as a trusted independent partner with a clear, strategic vision of your internal, local and global challenges. We provide a fresh approach to Executive Search, Leadership Advisory, Interim Management, Recruitment Process Outsourcing and Board Solutions, in both mature and emerging markets.
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