Houston expert: How to get the most out of your recruiting partner

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Recruiting can be difficult — but finding the right partner can make the process a lot smoother. Photo via Getty Images

I’ve been in the retained recruiting industry for nearly two decades, with a four-year stint in the middle as an internal director of talent at a management consulting firm, so my knowledge is primarily based on the point of view of an outsourced recruiter. What’s more, my professional advice is relevant to most companies, but not all.

At Sudduth Search, our clients are generally investor-backed companies in the lower and middle market. Most are startups— both early-stage and large but all are growing rapidly—and we mainly search for director to C-level executives. And just like not all companies are the same, not all recruiters are either. I don’t believe there is a “plug and play” one size fits all recruiter; you need to find one that works for you and your culture. That being said, there are indeed ways to ensure you ARE getting the most out of the recruiter with whom you engage.

Ok, now that we’ve got the boring stuff out of the way, let’s get into some real talk. How should you choose a firm and launch your search?

Get on the same page

First and foremost, make sure the recruiter you choose is the right cultural fit (a.k.a. emotionally intelligent and not a jerk). Will the recruiter represent your company and ethos well? If you’re put off by the recruiter’s sales tactics, or the recruiter regularly isn’t prepared, they’ll likely treat your search the same way. If YOU wouldn’t hang out with your recruiter outside of work, chances are your best candidates won’t want to talk with them either.

Expertise is key

Can the recruiter explain the process they follow, step-by-step? Recruiting isn’t luck. The best results come from following a proven process, being diligent, and detail-oriented. If your recruiter is “winging it,” and pushing candidates they already know, that’s not what you need. Heck, you could do that yourself and save a lot on fees. Have them walk you through their specific strategy so you know they aren’t just hoping to find the resume you’ll like.

Know your niche

Let’s also touch on recruiters with a specialty focus, something I get asked about more often than anything. Here’s what some of my prospective clients say: “We want someone who specializes in purple unicorns from the rainbow ranch industry.” For comparison sake, when you hire a lawyer, do you limit your search to ONLY those who work with purple unicorns from said industry? No, because we all know there could be a conflict of interest with competitors. Plus, if an attorney knows the law and how to apply it, it shouldn’t matter if they have a narrow focus. Similarly, if a recruiter specializes in exactly what your company does, or what the related position is for, their focus will be very narrow, making it difficult not to trip over past (or current) clients during the process. And it’s always possible your recruiter will be looking to poach from your team when they’re done with you. If a recruiter knows how to recruit for a multitude of positions within various industries, their methodology is probably what makes them successful; they’re not just spinning a rolodex, hoping it lands on the right candidate (and yes, I know I just aged myself).

Once you’ve chosen your recruiting firm, let’s talk about how to maximize their value:

  • Your recruiter should provide you more than just fodder and a resume for the recommended candidates. An important part of the process needs to include the recruiter giving you a thorough overview, analysis and opinion of the candidate. Answers to questions such as: What is their motivation for changing jobs? Why are they interested in your position? Why have they had a short tenure? How much revenue do they manage? You need to understand the candidate’s motivation for entertaining a new position and any gaps between jobs or questionable moves should be addressed. My hope is that my clients can forgo the boring interview questions and get straight to the meat of whether they like the person, and believe that particular candidate will be successful in the role and an asset to the team.
  • Your recruiter should scour the market without just focusing on people looking for a job, but also passive candidates. Most of our searches have a minimum of 50 candidates, and some have 300+. As a client, you should have the ability to see all of the candidates being considered. You’re paying for the search; you need to know that the recruiter has completed their due diligence and pursued as many leads as possible.
  • Passive candidates take longer to decide if they’re interested in your open position. Give them time to go through that thought process of deciding if they are interested. If you rush the recruiter, and the candidate feels pressured, you’re probably going to miss out on some stellar talent.
  • Your recruiter should be talking to the candidate all along the way, to keep them engaged and better ascertain whether the candidate is still interested and will accept an offer if given one. Nowadays, the market is a bit crazy, so you’ll never know whether the candidate is being recruited elsewhere. However, if the recruiter is doing their job, they should have a good idea whether the candidate will make it to the finish line and accept your offer.
  • Weekly calls: I know, I know, you don’t need another meeting on your calendar. But trust me, this is the best way to execute a successful, efficient search. The recruiter should provide weekly updates, including challenges, feedback and progress with particular candidates that look favorable. You, as the client, should be open and communicative with your concerns, questions or otherwise.
  • The recruiter should help you through the offer negotiation process to ensure there are no surprises. The last thing you want is to make an offer and then find out the candidate is entertaining three other offers. Ok, even with 20 years of experience, I sometimes get surprised. But I do everything possible to prevent that from happening. You should know exactly why the candidate wants or is willing to make a job change, from the first time you talk to them. While salary expectations can vary, you should never get to the point of offer and be shocked by the amount it will take to secure their commitment.
  • So what if you are a start up, does all of this advice apply? Absolutely, because with fewer people, early leadership hires are even more critical to your ability to succeed and raise capital.Startups and early-stage companies need to think creatively when making offers. If someone is prepared to take a risk on you, they deserve to at least make the same money they did before.Or maybe you can you offer them success-based compensation, like equity or tracking stock? If the person you are hiring is not motivated by success-based compensation, then they are probably not cut out to be at a scaling company. It takes someone who is self-driven, who can see the end result and figure out how to get there. They must be willing to put their own “skin in the game” in order to see the whole company succeed. They are the type that thrives on being challenged. If they don’t, then let them go as they will likely bolt if the going gets tough and you are better off knowing that ahead of time.

I think that covers most of it. I’m probably going to make a lot of recruiters mad because I just made their jobs harder. But I believe it’s a recruiter’s responsibility to bring as much value to their clients and the recruiting process as possible, and to ultimately attract the best talent possible. And if you do need a purple unicorn from a rainbow ranch, please call Sudduth Search, we’ll find you one.

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Jen Sudduth is the founder and managing partner of Houston-based executive hiring firm Sudduth Search LLC.

Employers across industries need to step up their game when it comes to retention and recruitment. Photo via Getty Images

Houston expert: How to thrive as an employer amid The Great Resignation

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With Baby Boomers and older generations exiting the workforce in droves and COVID-19 variants still straining hospitals and doctors’ offices, the health-care industry is experiencing its own “Great Resignation” at a time when health-care occupations are projected to add more jobs than any other occupational group.

The U.S. Bureau of Labor Statistics’ Occupational Outlook Handbook reports that “Employment in health-care occupations is projected to grow 16 percent from 2020 to 2030, much faster than the average for all occupations, adding about 2.6 million new jobs … mainly due to an aging population, leading to greater demand for health-care services.”

This greater demand might run into a supply issue if employers don’t act swiftly to find creative ways to retain and recruit their staffs. Today’s workforce knows its value and is no longer so easily enticed or satisfied with basic benefits packages. It’s an employee market and employers across all industries are having to step up and bring their A-game when it comes to retention and recruitment.

What you can do to up your ‘A-game’ in 2022

COVID has taught employers that they must change to survive. Spend the time now to develop a strategic plan that will allow you to adapt and improve throughout the year. Be sure to give yourself a cushion in your budget that will allow you to meet new employee demands as they arise and to be generous with relocation and sign-on incentives when you compete for top talent. You can later list these incentives in your job advertisements and highlight any other benefits that might capture interest and bring talent into your organization.

Start your recruitment and retention efforts with a survey of your staff. Find out what they really need and want from you, then try to find ways to meet their demands. Some simple ways for you to take care of your employees right now include:

Bring employees meals to their floor.

Hospitals are becoming filled up once again with sick patients and most are understaffed as employees are contracting COVID from patients. Treat your staff to healthy food—not cookies and cakes—allow them to really stop and take 15 minutes to breathe and fuel their body. This can be done twice or three times a week for each shift. Talk to them about food options or restrictions so that everyone feels like they can participate.

Bring in a counselor on a monthly basis that employees may access during their shift.

Providing this accessible, valuable resource will give your staff the opportunity to address their mental health and wellness and can help you reduce burnout among your ranks.

Allow at least one meeting a week to be focused solely on your employees.

Often the shift start-up meetings are rushed due to the day’s demands. Spend at least one of these meetings a week asking your team things like, “Where do you feel you impacted someone this week?” or ask everyone to share a personal achievement that has helped them personally keep going. This will help you build unity with your team and develop a more positive, empathetic relationship.

Provide bonus incentives to take on extra shifts.

There’s a lot of work to be done and often too few people to do it, so make it worth their while by offering a bonus for taking on more work than normal. You can also provide an option for them to earn overtime on a rotation so they can plan accordingly and still have opportunities for rest and a life balance.

Help relieve the stress of being in a high-risk environment by offering additional paid sick leave for a COVID-related absence.

The paid leave should be for the employee to quarantine at home and convalesce or care for an immediate family member who has the disease, and it should not take away from their accrued unused time off. Consult your HR advisor or attorney to find out whether paid sick leave is legally required in your jurisdiction.

Say “thank you.”

It may sound overly simple but just having the executive leadership go in and say thank you, shake hands, or even show up to a shift meeting can show the staff that their leadership cares about their hard work and recognizes the excellent care they are providing to their clients and patients. People in health care or associated service industries just want to know that they are making a difference, so share positive feedback from patients when you can. It matters.

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Denise Macik is the manager of strategic HR advisory services for G&A Partners, a leading professional employer organization that has been helping entrepreneurs grow their businesses for more than 25 years.

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Houston lab explores how AI bots can help the elderly

AI for aging

The University of Houston’s Empathetic Lifespan AI & Robotics for Aging (ELARA) Lab is currently conducting research into how AI bots may be able to help the elderly live more social and independent lives through several ongoing initiatives.

The lab officially launched last month as part of the Gerald D. Hines College of Architecture & Design under the leadership of Assistant Professor Chorong Park. Part of the lab’s mission is tackling ongoing problems with aging, such as dealing with disabilities and social isolation. Researchers’ current work is focused on designing a new AI companion bot specifically tailored to the needs of older people.

“We need to take all the needs of older adults seriously,” Park said in a news release. “They won't use the robot if they don't feel at ease or if they feel they are being constantly watched.”

The field testing of new AI bots in this population hopes to overcome several traditional obstacles in technology use among the elderly. A study by Park shows that many older people have a fear of overt surveillance when using advanced AI. There is also ageism to consider. Most new technologies are designed with younger and employed buyers in mind, not retirees who may need help remembering daily tasks or accessing important information.

“The more older adults are excluded from technology development, the worse those technology gaps will become,” Park said. “AI and the majority of technologies are created for younger people, so my research method integrates older adults directly into the design process.”

ELARA recently collaborated with the Mamie George Community Center in Richmond, Texas, to track seniors’ response to desktop AI bots like Emo and Cupboo. Researchers also had participants use air-dry modeling clay to create their ideal robotic companion.

While the eventual AI bot may be able to help the elderly feel less isolated and more supported, there are concerns to consider. A study published in the Asian Journal of Psychology charted the development of delusional thinking in a 72-year-old woman who became convinced the empathic-response bot was in love with her. The rise of “AI psychosis” has the potential to exacerbate mental health problems, particularly in socially isolated people, which a quarter of Americans over the age of 65 are.

ELARA’s research is focused on creating “pet-like” AI models with enhanced trust cues. If it can overcome the dangers of socially isolated people relying on AI for companionship, it could be a big step forward for independent aging.

SpaceX IPO set to be biggest ever and could make Elon Musk a trillionaire

IPO News

SpaceX says it plans to raise up to $75 billion when it goes public this month, setting the stage for the largest-ever stock market debut and putting Elon Musk on course to becoming the world's first trillionaire.

The company, formally known as Space Exploration Technologies Corp., said Wednesday it will sell 555.6 million shares at $135 a piece in an initial public offering. The estimated proceeds would easily top the $26 billion raised by oil giant Saudi Aramco in 2019. The offering would also give SpaceX a market value of $1.77 trillion. Only six companies in the S&P 500 are currently worth more, with Nvidia tops at $5.2 trillion.

Besides the size of the offering and the expected proceeds, SpaceX's amended prospectus updates details about how much control of the company Musk will have. As SpaceX's CEO, chief technical officer and chairman, Musk's voting power will come primarily through his ownership of 5.22 billion Class B shares, which give the holder 10 votes for every share held. According to the filing, Musk would have 82.4% of the voting power in the company.

Forbes currently values Musk's net worth at $826 billion and his stake in SpaceX at $542 billion. The estimated value of his SpaceX holdings was based on an overall value for the company of $1.25 trillion. Based on those numbers, a $1.77 trillion valuation for SpaceX would boost Musk's net worth by $223 billion, making him a trillionaire. However, much of Musk's worth is in stock that he has yet to cash in.

Even as it makes a bid for a blockbuster market debut, SpaceX is currently losing billions of dollars a year. The filing shows that the company lost $2.6 billion from operations last year on $18.7 billion in revenue, and the losses kept piling up at the start of this year, too.

Fantastical plans

Time will tell how SpaceX fares on the market. Musk's plans for the company are as fantastical as the money he hopes raise in the sale.

Colorful, even frightening in parts, the IPO document strikes a contrast with the typically dry, technical prose in IPO documents, detailing plans to use proceeds from the sale to help put men on the moon again and perhaps even Mars. In one section, it talks of a need to build "a permanent human colony" on the red planet with "at least one million inhabitants" as existential threats loom that could consign man to "the same fate as the dinosaurs."

Musk has almost equally ambitious plans for his other publicly traded company, Tesla. His goal is to transform the maker of electric vehicles into a producer of robotaxis and humanoid robots. Dan Ives of Wedbush Securities wrote in a research note that he expects Tesla and SpaceX to merge next year.

AI plays a key role

Key to the success of both companies — and any merged entity — is artificial intelligence. In its IPO filing, SpaceX says it sees potential revenue from AI of up to $26.5 trillion. But that depends on another lofty Musk ambition — putting data centers in space, which is not technologically possible at the moment.

Transforming his space company into a primarily AI-focused company will be a challenge for Musk, who started xAI in 2023 with 11 other co-founders who have all since left. Some were recruited away by rivals.

Its main AI product, the chatbot Grok, is "less impressive than anything that we see from any other major player in the space, whether that's OpenAI, or Anthropic, or (Google's) Gemini," said IDC analyst Arnal Dayaratna.

Dayaratna said that doesn't mean SpaceX doesn't have potential as a major AI player, thanks in part to its computing partnership with Anthropic and Musk's recent deal that gave SpaceX the rights to buy AI coding tool Cursor for $60 billion later this year. Folding in Cursor's capabilities would give SpaceX access to the coveted business customers now using Anthropic's Claude or OpenAI's ChatGPT.

SpaceX plans to use the net proceeds from the IPO to fund the expansion of infrastructure for its AI and rocket businesses, and to beef up the constellation of satellites that power Starlink Mobile, among other investments.

The company plans to list on the Nasdaq under the symbol "SPCX" and could begin trading as soon as the end of next week.

And SpaceX isn't the only colossal market debut investors are now bracing for. Earlier this week, Anthropic submitted a confidential filing with the U.S. Securities and Exchange Commission to officially start its own IPO clock.

OpenAI has not yet reported filing the initial SEC paperwork, but an IPO from the ChatGPT maker is widely expected.

"This listing represents the first major test for public markets after years of muted IPO activity with SpaceX paving the way for AI giants Anthropic and OpenAI to follow soon after," Ives wrote.

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Associated Press Technology Writer Matt O'Brien contributed.

New UH survey reveals concerns over AI data center growth in Houston

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A new report out of the University of Houston shows that area residents remain wary of the long-term effects of operating data centers.

The recent survey from the University of Houston’s latest SPACE City Panel, conducted by the Center for Public Policy at the Hobby School of Public Affairs, shows that while 85 percent of Houston-area residents use AI, nearly 63 percent oppose the construction of AI data centers within 1 mile of their homes.

Respondents’ concerns centered around data centers’ high energy demand and the area’s power grid reliability. According to the survey, 32 percent of residents who oppose local data center projects would be more likely to support the centers if they relied on renewable energy over fossil fuels.

“Respondents understand that AI can bring economic and educational benefits, but they are also concerned about the physical infrastructure needed to fuel AI, especially data centers,” Soran Mohtadi, post-doctoral fellow at the Hobby School and a researcher on the report, said in a news release. “This physical infrastructure demands more electricity and water, leading to environmental impacts.”

Experts estimate that 6.5 gigawatts of data center capacity will be added to the Texas grid by 2030. And Houston’s data center capacity is predicted to more than double by 2028.

The Electric Reliability Council of Texas also projects electricity demand could reach 218 gigawatts by 2031, which would be more than double the record peak set in August 2023. Data centers are expected to account for 86 gigawatts of that new demand.

Survey respondents also said they are concerned about the state's future water supply, given the large amounts of water that data centers need to stay cool.

In terms of who’s responsible for that issue, 57.6 percent of respondents said they put the onus on Texas lawmakers, while 31.5 percent say tech companies should be responsible.

Additionally, more than 75 percent of respondents believed that data center developers and technology companies—not residents—should bear the cost of infrastructure upgrades to support data centers.

“Every decision legislators make has implications on residents’ everyday lives and local infrastructure now and in the future,” Maria P. Perez Arguelles, lead researcher on the report and research assistant professor at the Hobby School, added in the news release. “This issue is going to become more important in years to come, so this is just the beginning.”

Read the full report here.

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