Executive Search - A Combination of Hard Work and Aggressive Integrity

1Q.

We have been dissatisfied with retianed searches in the past. Service was slow, the number and quality of candidates presented was inadequate. These were firms with a worldwide network and international reputation. What makes TMT different?

1A.

In order to survive and thrive we must be excellent in Japan. There are fewer assignments per Consultant, so they have more time to focus on your needs. Our Consultants are rewarded not for their client development skills, but solely on the basis of appointments or placements successfully completed. Consultant pay and reward system is such that in order to stay on our team they must serve you with placements. Our best consultants stay with us because they are "Partners before profits" and many are earning over 20,000,000 yen, 30,000,000 yen, (and a few much more) in personal annual income. Our better Consultants earn 40%, 50% and more of the gross placed revenue they generate.

2Q.

On president, General Manager and other high level senior positions, isn't there an advantage dealing with an Executive Search firm with a world-wide network of offices? Couldn't the man be in L.A., London, Dusseldorf or Taipei?

2A.

He definitely could be located outside Japan. Many clients initially feel that way, but then they have found that since key people are only abroad for three to five years, and then brought back to the home office in Japan, there are more former Presidents of U.S. or European operations in Japan than there are in the U.S. or Europe! These people and their wives have already made the sometimes difficult transition back to life in Japan. Furthermore you need to sell through Japanese distributors and to Japanese customers. Recent returnees or people with too much time abroad, or in international operations often means that there is a lack of experience and contacts, or old contacts in Japan. In addition, many clients have confided in us that unless you are looking for a foreign expatriate, the "world-wide searches" sound good but they don't amount to much and are often counterproductive. They tell us that the responsibility gets shared and diluted between the offices. This means that no one unit stands up and is really accountable. There is a hope another office in the network will come through. There are definitely enough, and the largest number of well qualified Japanese executives right here in Japan and TMT will get you one. All you need is one winner!

3Q.

Why are the Candidates you scout better than those that other search firms have presented?

3A.

TMT has never run an ad to attract people for our clients. TMT also does no Japanese language media advertising so we get no "write-in", unsolicited resumes from Japanese people. We have the manpower to scout directly into Japanese and foreign capital firms. If you tell us you want the best person from ABC division of XYZ company, we will identify him, make contact, and hopefully get his permission to meet with you.

4Q.

We have given up on retained searches -- been burned too many times in the past. What makes TMT retained search terms better and different?

4A.

TMT is sorry you have had these experiences. Please understand and make the important distinction between what we offer and what you have experienced and been unhappy with in the past. In the past you may have paid two-thirds, three-thirds, or perhaps five-fifths of the fee over the first two, three or five months of the search (depending on the Search firm's contract terms), even if the right man was never presented.

5Q.

Today in Japan, aren't there many search firms that are willing to work without these retainers? Aren't these people hungry? Won't they also aggressively search for me?

5A.

They may be hungry, and headhunters are sprouting up in Tokyo like weeds. A single headhunter or a small firm of a handful of Consultants may get lucky and be able to fill the odd assignment. But without adequate facilities and enough manpower, these operators cannot present you with a sustained effort on a continuing basis. When they get too many assignments, fulfillment suffers. They need to drop difficult searches where fresh ground must be broken. Only if they happen to already have a suitable person, can they fill your needs.

6Q.

But if my company stays in touch with enough of these pure contingency search firms isn't it possible that we can fill our manpower needs?

6A.

Of course it is possible. But our clients who have been there, and now use TMT, will be happy to describe the difference. Staying in touch with many search firms that do not consistently produce for you is time consuming and an inefficient use of your resources. (It is also risky. Many clients tell us that sloppy use of headhunters who have no reputation and nothing to lose has led to having their people headhunted away.) Also when each of those headhunters realize that you are using so many other headhunters, they know and understand that their chance of making a placement is very slight. If reasonable efforts do not result in placements they will drop you. They lose heart. None of these headhunters will kill themselves for you -- make one more cold call, bring in one more person. The results are very hit and miss.

7Q.

So what TMT is trying to tell me is that to get the best results there needs to be some mutual commitment. The client needs to be able to put pressure on the headhunter, needs to be able to "kick him around a bit," because the client paid and the headhunter must pay it back with service and results, right?

7A.

Exactly! We started out saying that too much money in advance lost with each assignment is not the answer, for those search firms can stay in business without getting results (without making placements or making mediocre placements). But if a client is making no commitment to a search firm, the search firm owes the client nothing and they owe you no commitment either! (The "commitment" fee really is exactly that!)

8Q.

Wait a minute! TMT, you're forgetting something! Isn't the 35% or more, of the placed person's annual income enough of an incentive to get your Consultants to work for us?

8A.

Indeed. That is our bread and butter. Everything except perhaps a 100,000 yen per month non-deductible retainer (not for each assignment but for all your assignments) is deducted from these 35% success fees. But unless a client goes along with TMT's very fair and reasonable business terms, as a company TMT cannot internally manage the account and manage (force!) our Consultants to consistently produce. One way we do this is by getting your feedback and taking the account away from a Consultant who is inadequately performing for you. Contingency clients have no place in our computer network, do not get the "TMT Monthly Activity Report," or the "How are We Doing Client Survey." Stated differently, Executive Search Consultants (based on years of watching them) do not take these contingency clients seriously. Also TMT management must see that priority is placed on our "proper clients" who continue to see us through with our reasonable terms.

9Q.

Is TMT trying to tell its clients that it is in the clients' interests to understand why TMT terms are unique, different, and just as beneficial to the client as they are to TMT?

9A.

Yes. Thank you. We are taking the time to write all this down for you because experience shows us and our clients that the decision you are about to make -- whether or not to work with TMT with our unique, mutually beneficial, business terms -- is one of the most important decisions you will make, influencing your long term success in Japan, as well as your own standing in your company, and your career prospects. In our various publications, including most recently, "Japan True or False", there are 87 detailed signed testimonials from clients that show TMT has placed over 20, 40 and even over 50 people, at a number of client firms. We even helped to make some companies number one in their product category. They worked with us for years on the basis of these terms. (In the company where we placed over 50 people, they had a hiring freeze worldwide for one year, but still wanted to pay the 100,000 yen retainer fee.)

10Q.

With TMT's system do you ever have some clients getting "penny-wise and pound foolish," or getting nervous about the non-deductible 100,000 yen retainer?

10A.

We certainly do. It ends up that the client hurts himself more than he realizes. Managers -- Japanese personnel managers and sometimes general managers, both Japanese and sometimes foreign, will get a knot in their stomach -- like seeing a taxi meter running. This is a shame, because when these fees are turned-off (TMT no longer has to or can make the same managed commitment toward you.) Inevitably the relationship fizzles out. The client wonders why he can't get people the way he used to. "What happened to TMT, anyway? They used to be so good!" (TMT is always good but we simply cannot serve "spot" clients as well. In fact the "commitment" is no longer there.) The extra cost for our sustained commitment is only an extra 1,200,000  yen per year.

11Q.

Are there any other benefits to using TMT over other executive search firms?

11A.

There is one especially deserving of mention. Only very, very rarely will one of the people we place not work out. Because of our strong practice in personnel consulting on terminations, we are in an especially good position to consult with you, to quickly and smoothly solve these problems. Likewise, due to our consulting expertise, we will exceed your expectations in terms of making sure you are doing the right things with compensation and benefit design, offer letters, Rules of Employment and other key strategic value-added areas.

12Q.

Which assignments are the most difficult in Japan? Japanese Senior General Managers, Presidents and Director level board positions, or mid-level manager and technical/scientific line positions?

12A.

In Japan, all senior managers of major Japanese companies -- Bucho level and above, are listed in published directories! Thus these people are very visible and identifiable. At TMT we have a library of these directories over a 10 year period, so we can accurately and precisely trace peoples careers, movements, comparative standing with peers, and current standing in terms of corporate pecking order. Still, it does take manpower to meet, screen, assess and persuade these people to join you. But the really difficult positions to fill are the more junior, "invisible" managers and technicians, who are not listed anywhere.

13Q.

I cannot build a company with just chiefs and very senior people. How can we source, identify and recruit the more junior managers and technical staff?

13A.

This is actually a real problem for you. These younger people don't yet know where they will end up in their company and are actually more conservative about quitting than managers in their 50's. To make matters worse, since these placements at lower salaries are less lucrative to the headhunter, it is difficult to find a search firm that will concentrate on these low level positions. Even a single, hungry, contingency, independent headhunter with no strong client base, is likely to try and sell a couple large jewels (senior candidates) in his pocket, rather than concentrate and really work on these less lucrative and more difficult mid-level and more junior assignments.

14Q.

If we give TMT an exclusive on all our most lucrative senior assignments for Japanese executives, will TMT also appreciate this, and unlike other senior executive search firms, be willing to work with us on our less attractive, less lucrative, and more difficult less senior positions?

14A.

Yes, we will! This is because somebody has to do it! Our clients need the service, and it is an invaluable service that our clients appreciate. Although our margins are much lower, we are willing to invest in our facilities and manpower so that we can help you in this way. If you ask our competitors with international networks, they will sniffle and declare they only do the top. That should not impress you. We do the top faster, better than anyone, and we offer you richer options, and also get into the least approachable Japanese competition, if that's what you want. If TMT has served you conscientiously and well at mid and less senior levels, we certainly hope to get all your most senior assignments. We would be very disappointed if we were not awarded them. Please be sure and give these plums to TMT -- the firm that is best equipped in Tokyo to build-up your firm, and meet all your critical senior and mid-level human resource needs.

15Q.

This document/presentation is directed mainly to companies that have multiple assignments. Is TMT also happy to work with a company that has, or anticipates having just a single assignment? Will you work on a "fixed fee" (fixed hypothetical salary) basis?

15A.

Definitely, yes! We will stop our 100,000 yen non-deductible retainer as soon as the single assignment is completed. It is also possible on single assignments to limit the retainer in advance to, for example, a four-month period. (Unless there are special circumstances from the client side, TMT can almost always complete an assignment within four months to six months.) If clients prefer we can also decide the total final fee in advance for a given single assignment.