UI has spent millions on search firms

UI has spent millions on search firms

URBANA — When the law and business colleges needed new deans in 2008, the University of Illinois didn't just rely on faculty search committees to find candidates.

The UI paid search firm Baker & Associates $190,000 to help fill both positions. Then, when the searches failed to turn up suitable candidates, officials brought in another search firm, Greenwood/Asher & Associates, at a cost of $200,000.

In the end, the university wound up choosing internal employees for both jobs: Larry DeBrock, the interim business dean, and Bruce Smith, associate dean at the College of Law.

Facing administrative turnover and a growing number of vacancies in recent years, the UI has increasingly turned to outside search firms to find new leaders.

The price tag? Almost $6 million over the last nine years, paid to nearly two dozen different consulting firms. In one of the most recent instances, the UI paid $90,000 to one firm for three weeks of work to recruit men's basketball coach John Groce.

University officials and industry insiders, including one longtime higher education recruiter, say search firms can drum up interest among candidates who otherwise might not have considered the job. Consultants also manage searches for busy faculty and staff serving on search committees, they said.

But as search costs mount and some university leaders end up leaving or resigning within a few years, some faculty question the value search firms bring to higher education. They worry the search firms may diminish the faculty voice in choosing new academic leaders, and raise questions about conflicting loyalties — say, when a search consultant is hired to recruit an administrator and that leader then hires the same firm to recruit for another vacancy.

Once used primarily for high-level university jobs such as president and chancellor, search firms are now routinely hired to find provosts, deans, directors, even a UI associate director of housing for dining services.

The growth is evident in the numbers.

In 2004, the university spent a total of $160,929 working with three different executive search firms. In 2008, when the university faced a large number of vacancies, the number exceeded $1 million. During the current fiscal year that ends June 30, the UI has worked with 11 firms so far and has paid out $845,759.

Question of value

University spokesman Tom Hardy said the UI and similar-sized universities, like Fortune 500 corporations, are "big, complex organizations" with multibillion-dollar budgets and tens of thousands of employees.

"We're looking for the very best talent to lead these organizations, and we need to be able to engage people who do this kind of search work for a living. They've got contacts nationally, even internationally. They may well know where the best qualified people are for different types of positions," he said.

The university would be at a "steep competitive disadvantage" if it did not use search firms, said Christopher Kennedy, chairman of the UI Board of Trustees.

"First, they know where the talent is. Secondly, they have access to that talent. They're speaking to them every day. ... Those firms know who is in play and who's not, who's happy and who's not.

"The trick is to maximize their value by teaming them with the faculty and other knowledgeable people. Then you get a lot of value out of the search firm," Kennedy said.

Others aren't so sure.

"The question is, what value do these firms add?" said Bill Sullivan, professor of landscape architecture at the UI.

He has been on search committees for deans and department heads and said members of the committee work hard getting the word out to potential applicants.

"It's nice when you have a firm do that, but is it worth the tens of thousands of dollars, or, in some cases, hundreds of thousands?" Sullivan said, arguing that the money would be better spent on minority recruitment or student aid.

For major administrative searches, a search firm's bill can top $100,000, not including expenses related to travel, teleconferences and other items.

Two years ago, the UI spent about $303,000 on the search for outgoing President Michael Hogan — of which $160,000 was paid to Isaacson, Miller of Boston, Mass., the same firm the University of Connecticut used to hire to Hogan. Isaacson, Miller also handled the Urbana chancellor search that led to the hiring of Phyllis Wise. That search cost about $155,173.

"I don't want to be in the business of micromanaging any institution, but clearly someone hasn't gotten the memo. ... The state is broke," said state Rep. Chapin Rose, R-Mahomet, who introduced legislation earlier this year that would prohibit state universities from hiring search firms with money from the state, tuition or student fees.

"Call me crazy, but sometimes in the old days, some things were done better and cheaper," Rose said.

Growth of an industry

When Jan Greenwood launched her search firm, Greenwood/Asher & Associates, in the early 1990s, few firms focused on higher education, she said. Now, not only are there more recruiting firms that include a higher education division, but more search firms are specifically focusing on higher education. Some firms specialize in one subset of higher education, such as chief information officers, athletic searches or medical college personnel.

According to a 2011 American Council on Education study of the American college president, search consultants were used to recruit nearly 60 percent of recently hired presidents, up from 49 percent in 2006.

Andy Brantley, the executive director of the College and University Professional Association for Human Resources and a former chief of human resources at the University of Georgia, believes more universities are looking to firms for help because of "the highly competitive environment in higher education, particularly for key administrative leadership position."

A turbulent economy, Brantley theorized, has meant administrators are more reluctant to consider a move or put their name in as an applicant unless it's likely they will be considered a candidate. Many administrators may ask themselves, "Will I be able to sell my home?" and "Should I move my family or uproot my partner?" he said.

Add to that the graying of administrators. More and more presidents and chancellors are in their late 50s to 70s, Greenwood said. The average age for college presidents in 2011 was 61 years old, compared with 52 in 1986, according to the recent American Council on Education study.

"Higher education is experiencing a major pipeline issue," and that's causing universities to seek help on their searches and look, even globally, for candidates, Greenwood said.

"I don't think we should handcuff the University of Illinois in its day-to-day fight with other universities, a fight for talent that is global and epic," UI board Chairman Kennedy said. "The world needs to get used to the idea that the high-skill, high-talent entrepreneurial professor that we want is in high demand, and we're going to have to pay a lot of money and use go-betweens to get them," he said.

Investment of time

With the baby-boom generation aging, the pool of qualified people in speciality areas is shrinking and the competition for certain leadership positions is fierce, said Maureen Parks, the UI's associate vice president for human resources.

Twenty years ago it took about 50 phone calls to develop a pool of top 10 candidates; today, that number would be 150 — and even more for positions such as dean of a nursing college, Greenwood said.

"It's a wise decision to use a search firm who can invest the time and actually go out and solicit people who are not currently looking for a job but might be interested in an opportunity if it is presented to them appropriately," Parks said.

When a university looks nationally or internationally for a higher-level position, search firms can be incredibly helpful, said Gretchen Bataille, senior vice president at the American Council on Education and president of the University of North Texas from 2006 to 2010.

But when you get to the level of deans, it's a "grayer area," she said.

There are cases where a school wants to go in an entirely new direction — a college of engineering looking to hire from the private sector, for example — and a search firm could be useful, she said.

But typically, people who want to be deans are already looking for jobs, and they're usually sitting department chairs, she said. They know what's available.

The first search for a new UI business dean in 2007 resulted in an offer to a candidate but it was turned down, officials said. DeBrock was not a candidate at that point but later decided to throw his hat in the ring. With the law school, campus officials weren't happy with the finalists in the first search and started over, said interim Provost Richard Wheeler, who co-chaired the second search committee as vice provost.

In both cases college officials were much more actively involved the second time around, officials said.

Kennedy said the UI is competing with some of the best law schools and business schools in the country, at Northwestern University and the University of Chicago, and needs to match the tactics used by private universities.

"If the search firm worked well, it might actually save you time, resources and money even though it looks like a lot" of money, said Professor Don Chambers, who, in his 32 years at UI Chicago has served on search committees for chancellor, vice chancellor for academic affairs, provost, vice chancellor for research and more.

"The problem that exists is the search firm is not in it for altruism. The search firm is in it to make money," Chambers said.

'Complicated network of loyalties'

The increasing dependence on search firms has other implications, faculty say.

UI Professor Nicholas Burbules recently served on the search committee for the UI chancellor. He declined to discuss that search specifically but said "it's important to keep in mind who's working for whom."

He's worked with high-quality search firms that provided valuable help in terms of logistics and networking.

But, particularly with a confidential search, the vetting process can be an issue. Consultants will often take care of background checks and let the committee know of any red flags, he said.

"You're putting a lot of faith in the firm to do that due diligence for you, and I think that can be giving up a responsibility that" search committees should maintain themselves, he said.

Search consultants also have myriad people they've worked with on other searches, and that can create a "complicated network of loyalties," Burbules said. It's a process that depends on relationships, and sometimes that can interfere with the objectives of the search, he said.

Great advantages can come from an administrator working closely with a few key firms, said Brantley of the university human resources association. Search consultants will then have in-depth knowledge of the campus, its mission and key initiatives or programs, he said.

But some faculty question the cozy relationship that can develop between search firm consultants and administrators.

"The person who owes his job to the search firm suddenly has a loyalty to the search firm. You might argue that's a conflict of interest," Chambers said.

UI's close relationships

Over the years, UI officials have developed relationships with more than a dozen firms, including Greenwood/Asher & Associates of Miramar Beach, Fla. (paid about $839,000 since 2003-04); Isaacson, Miller of Boston, Mass. ($1 million); Parker Executive Search of Atlanta ($563,000); Witt/Kieffer ($461,500); Korn Ferry International ($490,000); and several others.

It was Isaacson, Miller that UConn used to hire Michael Hogan. A few years later, after B. Joseph White (hired by Baker/Parker & Associates in 2005) resigned in wake of the Category I admissions scandal, the UI selected Isaacson, Miller for its own presidential search, and the board of trustees ultimately chose Hogan.

Isaacson, Miller also worked to bring Phyllis Wise to Urbana. The firm currently is managing the search for dean of the College of Fine and Applied Arts in Urbana.

After former Provost Richard Herman was appointed chancellor of the Urbana campus in 2005, Greenwood/Asher worked on the search to bring in his replacement, Linda Katehi from Purdue University. Herman and Katehi used Greenwood/Asher for several more searches for the Urbana campus, including the business and law deans. Greenwood/Asher handled the recent search for vice chancellor for research.

Herman connected again with Greenwood/Asher in the fall of 2009 as he considered leaving the UI for another job. Emails released under the Freedom of Information Act show that Herman, who had also resigned following investigations into the admissions scandal, worked with Greenwood/Asher as a candidate for the presidency of New Mexico State University, which had hired that firm to run the search.

Greenwood said search firms do not choose candidates — "that's simply not our role" — but if someone was nominated, the consultants have to inform that person he or she was nominated, and it's the committee's decision if they want to see them, she said.

Bataille, of the American Council on Education, said some search firms she hired when she was a college president later called to see if she might be interested in a job, and usually she declined.

"They're just doing their jobs. They're trying to find the best roster of candidates," she said. "My sense is the search firms I've worked with were all highly ethical."

Code of ethics

About 20 years ago Greenwood wrote a code of ethics for search committees that calls on members to follow a set of guidelines, such as being fair and responsible in managing information, respecting confidentiality of candidates, not allowing personal interests to distort or misrepresent facts, and more.

"The better ones try very, very hard to avoid conflicts," said Raymond Cotton, a Washington lawyer who specializes in presidential contracts.

More often than not, he said, firms turn down opportunities to represent individuals if they've recently done a search at their university. They can't control who throws their hat in the ring, but the firms won't try to recruit someone who recently hired them, and "definitely not" a person they recently placed in a position, Cotton said.

But it's unrealistic to say that "an entire university is off limits," he added.

"There's this unwritten professional respect that if we work with a search firm, they are not going to directly contact someone at the University of Illinois who they have worked with in the past, whether it's someone in HR, someone on a search committee, someone who is a hiring authority," the UI's Parks said.

"However, if that individual goes directly to a search firm and says, 'I'm looking for a new opportunity; I'd like to throw my hat in the ring for a job you are a search firm for,' whether it's New Mexico or California or whatever, the search firm will say OK and determine whether that person is a good candidate."

Still, she said, the candidate would have to be qualified. The search consultant's reputation is on the line every time it handles a search, Parks said.

Professor May Berenbaum, vice chairwoman of the most recent UI presidential search committee, sees the search firm as serving a number of masters.

"The university's goal is to get the best person. The search firm's goal isn't necessarily to get the best person for that particular job; it's the search firm's goal to get that job filled. I don't know if those goals always align," Berenbaum said.

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hyena wrote on May 13, 2012 at 5:05 pm

University spokesman Tom Hardy said [...] "We're looking for the very best talent to lead these organizations, and we need to be able to engage people who do this kind of search work for a living."

  And when the very best talent that a search firm can sell doesn't quite work, there are always spin doctors and executive coaches available.

UI board Chairman Kennedy said "The world needs to get used to the idea that the high-skill, high-talent entrepreneurial professor that we want is in high demand, and we're going to have to pay a lot of money and use go-betweens to get them"

  Dear Chairman Kennedy, please excuse "the world" for not getting used to the idea of a president who fizzles out after a couple of years while being paid $600,000/year + perks, and who still gets a year-long, paid leave followed by a highly-paid faculty job. Please excuse "the world" for thinking that $100,000 is a lot of money that could be used to pay one or two years of a teaching professor's salary, or to renovate a couple of classrooms, or to put books and journals in the library, or to shave dollars from tuition and fees. Please excuse "the world" for telling YOU to get used to that idea, for a change.

 

 

 

 

kiel wrote on May 13, 2012 at 8:05 pm

Does anyone else find this more than coincidental: "Two years ago, the UI spent about $303,000 on the search for outgoing President Michael Hogan — of which $160,000 was paid to Isaacson, Miller of Boston, Mass., the same firm the University of Connecticut used to hire to Hogan."

 

Bulldogmojo wrote on May 14, 2012 at 11:05 am

They are clearly not seeing the forest for the trees...if it takes 150 calls to fill the job with people who have a larcenous view of their given responsibilities then what is the point of paying the firm for their work? Obviously there is a serious flaw in the service they provide if it only results in this kind of counter productive result. Warren Buffett said "you can be short on cash once in awhile but once you're short on reputation you are finished"


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