The first thing that catches your eye in headhunter Robin Sears' office in the Landmark Building is a fat folder marked 'Tsunami'. 'That's a secret strategic document I wrote,' he says, revealing only that the name refers to trends likely to affect the executive-search industry in the future. 'I think the change is going to be like a tidal wave.' Not only that but the economic tide that has lifted all the boats during the region's boom years will ebb, revealing the problems ahead. 'As the tide has gone out in some of these companies and lives of some of these executives, things are being revealed that are giving employers a clear signal there should be a change,' says Mr Sears, vice-president of Korn/Ferry International, the world's largest search company. 'And that causes companies to call us.' Like others in the industry - worth about US$7 billion (HK$54.3 billion) worldwide in 1996, according to a report released late last year by the Economist Intelligence Unit (EIU) - Mr Sears is coolly optimistic that despite the economic slump in Hong Kong and other parts of Asia, headhunting will continue to thrive. Even during a downturn when cash-starved companies are hunting the heads of their own loyal staff and showing them the door, opportunity knocks for executives and savvy employers. The growth, says Mr Sears, will be aided by the technology industry, for example, and telecommunications within - 'the hottest [sector] in the world right now'. The downside for fat cats? Their salaries may be thinner. 'It'll be marginally easier and somewhat cheaper to get the same skill-set than it was up to October 97 [when Hong Kong was hit by the currency crisis plaguing the region],' says Mr Sears. 'There will be more candidates because there'll be more turmoil among some of the weaker players in the market place.' According to Mr Sears, corporations are not just filling vacant positions, but hungrily hunting proven executives 'because they're never going to be more available than they are right now'. 'If the client is IBM, Coca-Cola, Ericsson - a big, strong brand name, long-term strategic player in Asia - this is a growth opportunity for them both in terms of people and market share,' he explains. 'We have clients saying we want you just on an opportunistic basis to find the best available talent that is now in jeopardy, or on the street in the market place, even if we don't have an immediate slot for them.' Coca-Cola's human resources manager Alex Kam corroborates the trend: 'As we are the market leader in China, and continue to rapidly expand our business there, we are actively recruiting local [Hong Kong] manager-level personnel who are able to keep growing our volume and further widen our market place.' But, he adds, 'at this time, the company is not looking for personnel especially equipped to cope with an economic downturn.' The soft-drinks giant uses a handful of headhunting companies to find upper-management personnel. 'For example, top-level marketing people can be more challenging to locate in this part of the world,' explains Mr Kam, 'which means we need specific individuals that executive-search companies have the resources to locate.' Indeed, the purpose of headhunting companies is to save companies time and effort in finding personnel - especially those in top-rung positions who might not actively be looking for a new job. At Korn/Ferry, for example, apart from the company's database (containing more than 50,000 names in Hong Kong and more than one million worldwide), Mr Sears says his staff depend on public data and 'active research' to find suitable people. Cold-calling is often necessary, both to make contact with a potential candidate or to ask for recommendations. Although search firms accept resumes, many are binned for a variety of reasons, age being one, marketable skills another. By the time a headhunter meets a candidate, researchers will probably have compiled valuable information on the person. Then comes the evaluation and perhaps disclosure of the client's name. While an impressive resume helps, headhunters have other ways of filtering people. Such information as the kind of food they eat and what they read, Mr Sears says, can give an insight into whether or not 'someone really has the curiosity and adaptability to handle a new company, new product, new market'. While he acknowledges that headhunting continues to be a mystery to most people, he says it is gradually becoming an attractive option. This is evident in the increasing number of corporations willing to pay for the service executive search companies provide - even in Asia, where the business is relatively new compared with the West. Seventy-two years after former magician Thorndike Deland began the first headhunting firm in the United States, according to Dr Stephanie Jones in her 1995 book Headhunting, A Guide to Executive Search in Asia, search companies are responsible for more than 75 per cent of all senior executive positions in that country and much of Europe. In a region which boasts the fastest expanding market for headhunting companies, the market in China has the best growth opportunities, according to Nancy Garrison Jenn, who compiled the EIU report. Mainland-based placements fuel the search business in Hong Kong, where many pan-Asia headhunting firms have their headquarters. In the SAR, the top 25 companies had a total net revenue of about US$82 million in 1996 compared with US$35 million in 1992. While Ms Jenn is upbeat about corporations' continued dependence on search firms to place seasoned executives, she is less gung-ho about middle-level assignments, by which she means jobs with a base salary under US$100,000. 'It would be crazy to say the Asian economic downturn will not affect business,' she says. 'You'll need the senior, strategic people to lead corporations through the difficult times, but there's often letting go at the middle level. That's where the cutbacks are and that follows in any recession.' She also believes the economic malaise will make it tougher for headhunters to persuade executives to switch jobs. The challenge will test headhunters' skills and creativity, she says, and separate the wheat from the chaff. Headhunting veteran Glendon Rowell agrees. Managing director of Boyden International, which in 1965 became the first search firm to open an office in Asia, he says he has seen it all before. While he concedes well-situated candidates will be more reluctant to leave their jobs, he seems convinced the slowdown will benefit the executive-search business. 'I went through this in 82 to 83 and 87 to 88 and what I learned was that when times are tough, company management sometimes can be myopic,' he says. 'They look out there and say, 'sales are down, so we have to get new people.' So what do they do? They fire or get ready to fire either the sales manager or marketing director, and they come to firms like us and say, 'We need new people.' ' According to Mr Rowell, the executive-search business can thrive in both boom times and a recession. 'What happens in the industry is that the fringe players, the smaller boutiques or highly specialised companies are the ones who may bite the bullet because they don't have the breadth of business that we have,' he says. For their services, most companies charge about one-third of a candidate's first-year salary and give a one-year guarantee; should the chosen candidate fail to meet expectations, the search company is obliged to replace that person gratis. According to Mr Sears of Korn/Ferry, mid-level managers in most metropolitan markets of Asia have starting salaries of about US$150,000. 'A CEO-level role [at a company] with several hundred million [US] dollars in revenue would be somewhere in the neighbourhood of [US] $500,000-$1.5 million,' he adds, 'which is more than it would be in Europe, less than it would be in the US.' While top-rung executives may be better paid in the US, Hong Kong still offers attractive salaries, particularly when taxes are taken into account, says Larry Wang, who established Wang & Li in 1994 to cater to Asian-Americans seeking jobs in Greater China. Even with more companies offering 'localised' expat packages, which do not cover housing or relocation costs, he says Hong Kong continues to draw the career-minded because 'promotions are quicker and salary increases higher here'. While there have been high-profile layoffs, especially in the financial sector, the many success stories continues to lure Asian-Americans to Hong Kong, Taiwan and the mainland. Mr Wang's company placed eight people in China last year, 15 in Taipei and 28 in the SAR. 'This year we hope to place 60 candidates,' Mr Wang says, nine more than in 1997. The company's niche is in meeting the demand in Hong Kong for bi-cultural, bi-lingual executives. Expounding on the most desirable qualifications in Asia's executive-search market, Boyden's Mr Rowell says: 'If you're a Westernised Asian executive who is multi-lingual [particularly if you have a graduate degree], and if you're in a technical world, the world's your oyster. There just aren't enough of you. The icing on the cake would be more than three years' experience in China.' Boyden, like most big headhunting companies, works on a retainer. Wang & Li charges a contingency fee upon the successful placement of a candidate. Unlike the bigger search firms, Mr Wang's 10-person outfit also places candidates just out of college as well as those at the upper end of the corporate ladder. In 1997, the company's income topped US$1 million, a 54 per cent increase from the previous year. This year, Mr Wang projects a rise of about 20 per cent. 'Most companies have a long-term perspective in the region,' Mr Wang says, adding the downturn may actually help foreign companies or multinationals by bringing about a fairer playing field. '[In many countries] there's under-the-table dealing or favouritism, or there are high tariffs that make it harder for foreign players to compete. But what's happening with the economic downturn is a lot of these things will have to be corrected or eliminated.' Still, many companies are bracing themselves for a lean year, he acknowledges, adding, 'but just because their revenues aren't going to be as high, doesn't mean they don't need to improve their infrastructure'. Mr Wang reckons that companies will be able to be more deliberate in their selections now, instead of 'hiring like crazy' to keep up with growth. Indeed, the rush in past years to increase staff numbers may be a boon for search companies now tasked with finding executives who can work well in a crisis and fix-it experts such as financial controllers who can help a company pare its costs. 'You have a whole generation of executives in Asia who have never managed anything but growth,' says Mr Sears, who was himself headhunted by a friend at Korn/Ferry four years ago. 'They have no experience of laying off colleagues, no experience of squeezing margins, no experience of dealing in a decline in revenue. Managing in a crisis is different and I think without question, tougher than managing growth. Some of the executives will fail. Some are failing.' Which is good for Korn/Ferry, whose Hong Kong office projects 15 to 20 per cent growth this year. Another executive search-firm, Bo Le Associates, which had predicted growth this year of at least 20 per cent, has recently scaled back expectations to 10 per cent. The company has a presence in Indonesia, decimated by the currency turmoil. 'In the last few years, the growth in headhunting has been rapid,' says Louisa Rousseau, who established Bo Le two years ago. A lot of the growth has come from new positions for new offices, new products, new markets. But those are the positions that have more or less been put on hold. 'That's obviously related to financial services, but even to companies in the luxury goods area and in the hotels industry.' In addition to the hiring freeze, she says, the slump has made assignments difficult to close. 'It's a very long working process,' she says. Wearing a brave face, she declares that despite the downturn, her company still hopes to grow this year 'because of the continued activity in investment banking, particularly related to China, as well as in corporate advisory, mergers and acquisitions and direct investment'. Like her competitors, instead of waiting to be swamped on the beach she is swimming out to surf the tsunami.