It seems that everyone has their own particular perception of/about Executive Search. While many people understand the concept of a “recruiter”, misperceptions arise when terms liked Retained Search vs. Contingent Search, or non-exclusive vs. exclusive get added into the conversation. Because the truth is while many talent acquisition professionals are labeled as “recruiters”, the various disciplines and methodologies involved are often very different as are the results. On the surface it may seem that having a non-exclusive relationship with many “recruiters” sounds much more productive (not to mention more economical) than paying an upfront retainer to a single Executive Search firm. Or how an agency with a “database” of existing talent might sound more efficient than hiring someone to conduct a “search” on behalf of your organization. But sometimes that “deal” you thought you were getting turns out to be more of an “ordeal”.
But if your CEO has asked you to research options for finding the right talent for that critical opening, where do you start? Here are the answers to 6 key questions you should understand prior to deciding on the type of executive search firm you’ll hire to fill a key role in your organization.
1. What’s the advantage in hiring a Retained Executive Search firm? Why not use a contingent recruiter who does not require an upfront fee? By nature, Contingent recruiters (executive search professionals who work without a retainer and are paid 100% of the fee upon placement) are not structured to be loyal to a client long term or even to the end of an executive search. As the contingent search model is based on speed, they focus primarily on the front end of the process, and they often “get going” (as in away) when the going gets tough. Typically for the client the most valuable part of an executive search and where most of the work gets done is at the beginning of the search. A Retained Executive Search firm will spend the early stages of a search learning about your culture, your competitive landscape, and where you are trying to take your company. This attention to detail ensures that their focus is on solving the company’s challenges and outlining the criteria to move the company forward, and subsequently accomplishing that through finding and introducing the right talent. Contingent recruiters usually obtain a cursory understanding of the role through a job description (and often simply copy your description and re-post it under their name) and attempt to quickly find resumes that match keywords rather than real requirements. Their loyalty is relative to the assignment; as they’re taking the most risk in essentially working for free, their primary goal is to fill jobs as quickly as possible and move on, not taking the time to truly understand your business and who represents a good fit. As a search becomes more involved, many contingent recruiters has moved on to “greener pastures”.
2. Why commit to having an exclusive agreement with an Executive Search firm? Why not hire multiple recruiters to work on a search? It may seem logical that the more resources/recruiters you use, the better your result will be. But actually the result is the exact opposite. Using multiple search professionals on a single position can cause more problems than it solves. First, the higher level, more experienced retained search professionals will not agree to engage in a free-for-all arrangement. That automatically limits your choices to lower level, less experienced contingent recruiters. And as you’ve set them in competition with each other, their focus is going to be on how fast they can provide you with as many resumes that might get them a placement, not on how they can find high quality talent that fits the stringent standards of the role you’re seeking to fill. And as the initial “thrill of the hunt” wears off fairly quickly, they’ll quickly move on to other things and you may find yourself with multiple recruiting contracts and no viable candidates. Or worse, dozens of irrelevant resumes from candidates who will all invariably be described as “rock stars”.
3. Why should I invest in a Retained Search? Because Retained Executive Search firms are consultative in nature, you receive far beyond a simple list of candidates or resumes. Retained Executive Search firms can offer value in their objective look at your organization and hiring process. In utilizing a Retained Executive Search firm, your organization will learn critical details in how your organization is perceived, how your hiring process might be pushing away the best talent, and areas of improvement that can make your organization an employer of choice which can be utilized by your in-house recruiting team going forward. And as their expertise will bring your opportunity to the attention of the best candidates, great executive talent bring great results and typically bring a huge upside to your organization’s profitability. Thus Retained executive search in a sense pays for itself. Great executive talent are an investment, not a cost. If your organization has been looking at procuring top executive candidate as a cost, it’s because you’re not hiring the right people. Working with a Retained Executive Search firm can turn that around effectively.
4. If the person doesn’t work out, can I have my money back? Almost all recruitment contracts offer a guarantee in some form or another. But another difference between contingent recruiters and retained executive consultants is with contingent you are paying for one executive candidate, while with Retained Executive Search firms you are paying for a methodology that results in an executive candidate as well as a process improvement that can be utilized time and again. Retained executive search focuses on the fit and then sets out in search of the talent, not the other way around. In the end, the financial commitment works out equally as both contingent and Retained Executive Search firms base their fees on a percentage of the candidate’s salary. The difference is that the consultative aspect and diligent research that Retained Executive Search firms provide enable your organization to save time and headaches by avoiding pitfalls and delays often associated with contingent search.
5. Do you have a database/network of executive candidates? Every experienced Retained Executive Search firm will have a detailed list of talent and sources they can draw on in the course of an executive search. But your organization has specific needs and aspects that are different from even your closest competitor. It’s a common misconception that the perfect candidate is sitting in a database somewhere. You are hiring a person, not just a set of skills and your company culture and how that executive fits with your team are as important as the skills and experience any candidate may bring. A Retained Executive Search firm will seek out passive talent who make the most sense for your team both in terms of skills and culture fit. It is rare that “database” candidates will be the perfect fit for an organization. Additionally, many databases are updated infrequently and as most database candidates are active job seekers they may have already found another role. A database is only as good as its data.
6. Do you specialize in finding (insert highly specific description of role) for (insert highly specific description Client Company)? It makes perfect sense that you want to find a Retained Executive Search firm that specializes in finding talent for your industry but you can sometimes invoke the law of diminishing returns in eliminating every potential search partner in an effort to find an absolute match. Many companies spend a great deal of time and effort to differentiate themselves from their competitors and set them apart in their industry. So trying to find a Retained Executive Search firm that only works on very niche specific positions in niche specific spaces may find you without a search partner altogether. A better question might be “What methodology does your firm employ?” or “What is your firm’s experience with companies similar to ours?” Many Retained Executive Search firms work in specific skill areas (i.e. software engineers or Marketing and Branding executives, etc.) which should help focus your quest for the right search partner. Once you’ve identified their area of expertise, a preliminary conversation can allow you to go into the finer specifics of the role and how the firm can potentially assist. Additionally, an expert Retained Search professional can look at your open role and its relation to your company’s success and provide a fresh perspective on how to solve your challenges whereas a niche specific recruiter may be dependent on well-worn methodology and might miss out on the right talent for your team.