Attracting and retaining top talent is one of the most important tasks for leaders. Organizations integrate the latest technologies into the recruitment process, such as social networks, mobile platforms, video interviews, or HR information systems, which help organizations work more effectively with talent in recruiting, talent adaptation, development, or performance management. There are various ways to attract the top talent. These include "#Retained_Executive_Search" and "#Contingency_Search." In both cases, the value for the customer is significant.
What are the significant differences?
Executive Search is a management consulting service delivering value and results.
#Executive_search is a #consulting job delivering high value for the client. It goes far beyond hiring the candidate. The role of the consultant (advisor) is to help the client make the best hiring solution. Jobs filled by Executive search usually have a strategic impact on the client business. Executive Search projects are associated with the executive level positions such as VP, BoD, and the entire CxO suite, locally, regionally, and globally. Executive search consultants work primarily with passive candidates. Executive search consultants assess both internal (client's employees) and external candidates and advising the client who is the best matching candidate for the job. Consultants bring deep market intelligence and industry expertise essential for the client to make an informed hiring decision. Presenting a CV and reference letter to the client is not enough! The client needs complex information about the candidate and the other vital areas that can impact the candidate's future success. The result of partnering with an executive search consultant does not always lead to hiring an external candidate. In some cases, a consultant, based on measurable data, can advise the client that the best hiring solution is not to hire externally and recommend promoting internally or moving to another solution. The consultant will help the client design optimal onboarding for smooth integration and help the client protect its investment.
#Contingency is more #transactional. A contingency recruiter is not a client advisor or consultant. The recruiter will present to the client relevant CVs on short notice. Contingency recruiters primarily assess external active job seekers. Usually recruits larger volumes, all types of positions, except executive jobs. In particular, easier-to-fill positions, where a sufficient number of available #active_job_seekers are assumed. Clients use Contingency frequently for #mass_recruitment projects.
Executive Search works primarily with passive candidates.
Geographical coverage and industry expertise
There are three types of executive search companies in terms of geographical coverage. Some are operating on a #global and #regional scale. They have a solid geographical range in multiple countries and deep industry expertise. Smaller "#boutique" companies tend to specialize in a particular industry or specific geographic region.
Also, staffing agencies have the same regional span and industry specialization in a specific industry.
Exclusive vs. non-exclusive engagement
While conducting a Retained Executive Search, selecting only one exclusive partner for the job instead of simultaneously collaborating with several partners is essential. In the Retained Executive Search, the client always works with a consulting company on an #exclusive_basis. Exclusive cooperation brings the client significant #value, including #quality commitment, #guarantees, a high level of #performance, and a high #ethical_standard. Professional consulting companies will present the potential candidate only to one client at the same time.
Contingency recruitment is often a competition between several agencies working on the same project for the same customer simultaneously on a non-exclusive basis. Only one agency is eligible for the success fee. If the client wishes to hire an executive role of key experts, the obvious question when deciding to work non-exclusive should be the quality. Does the consulting company or staffing agency have the client's expectations in the first place? What quality commitments and guarantees can a client expect? Is there a reputation risk for the client? If more than one consulting company or staffing agency approaches the same candidate with the same job simultaneously, the candidate is usually confused. Placing executive roles on a non-exclusive basis with multiple partners simultaneously always leads to a wrong hiring decision.
Executive search is exclusive-basis-only cooperation delivering significant results for the customer.
Approach
The most significant differences between both services are the nature of cooperation with the customer, selection and assessment methodology, consultants' work, consultants' expertise, and experience.
Retained Executive Search is a consulting service with a focus on providing a #solution with #results. It is not a transaction service. Consultants working in this industry have at least ten or more years of experience in corporate management roles or management consulting jobs. The consultant usually leads the entire process of direct search. #Identifies and #qualifies #candidates. The consultant works with various types of candidates, mainly those who are not active job seekers but match the required profile. This type of candidate often has significant work achievements, excellent leadership skills, unique expertise, which can be essential for the client. This type of candidate usually does not respond to advertised jobs. Before starting the search process, the consultant should spend enough time with the client to understand the organization, responsibilities, and expectations. The search for the best fitting candidate is always a #proactive and #systematic job to identify, and #assess the candidate against the client's expectations. The consultant is an expert in a specific area. The consultant should not lead more than three retained search projects simultaneously to guarantee high quality and meaningful results. The identification and selection process should include an in-depth market analysis, a #longlist of potential candidates, a multilayer of #interviews, and a #shortlist of qualified candidates. Within 1 to 2 months from the project commencement consultant usually present 3 to 5 highly qualified candidates to the client. The number of candidates depends on the specification of the position and the availability of candidates. An essential factor in Retained Executive Search is the #quality of the service and the high industry standard. Professional consulting companies provide clients with #regular_updates, feedback, market response, feedback from candidates, and remuneration negotiation. Consultants also actively communicate with the candidates.
In Contingency Search, #speed is a critical factor. Contingency search is a transactional type of job and focuses on presenting the candidate quickly. There is no prior in-depth market research. Sourcing of candidates is usually via database search, advertising in the media or job boards, and professional social networks. The recruiter often deals with many active job seekers and presents more candidates to the client. The recruiter usually submits the candidates after the first week of project commencement. The Contingency recruiters work in several positions simultaneously. It can be ten or more positions at the same time. Contingency recruiters are usually beginning their careers having fewer experiences and expertise than Retained Search consultants.
Executive Search requires an experienced consultant with deep market knowledge, industry expertise, bringing the right set of capabilities and skills.
Fees
The Retained Executive Search fee is usually higher than Contingency and reflects the service's #expertise to present #high_quality and qualified candidates. Several fee structure models are available on the market—the most frequent is a percentage of the annual total pay of the selected candidate. Another frequently used structure is a fixed fee. The #retainer_fee structure is usually payable in 3 installments based on the #fulfillment of individual stages of the process.
A contingency fee structure is a success fee. Frequently as a multiple of the candidate's monthly base salary or a percentage of candidate annual base salary. The staffing agency is usually entitled to a success fee only if the candidate starts employment with the client.
What to expect from Retain Executive Search service?
Professional Retained Executive Search companies offer a #service_guarantee, usually one year upon the job complexity, market and industry specifics, and arrangements with the customer. They adhere to a #code_of_ethics and "off-limit" agreement with clients. Usually, the decision to use Retained Executive Search service is to deliver #quality, the goal to #attract, and #hire the #best_candidate on the market. It requires an experienced consultant with proven #capabilities and #skills in attraction, assessment, and placement of executive leaders. Consultant needs to bring deep industry #expertise and market knowledge. The consultant often guides the client through the process and provides the best practices and intelligence possible to allow the client to make an informed hiring decision.