Many people consider contingency search recruiting to find candidates appropriate for the job. Imagine that you’re the VP of accounting, and you had a terrible experience with a specific contingency search firm. You require a corporate financial analyst, and the contingency recruiter claimed they had the best candidate for the job.
You agree to interview the candidate but wasted everyone’s time because they did poorly during the interview. Why would contingency search firms send someone ill-prepared and ill-fitted? Here are 10 things you should understand before using a contingency agency:
Contingency Recruiting Tips
- It’s a good job market. Many veterans haven’t seen a robust market like this with higher salaries that are in high demand.
- Contingency recruiters are primarily commission-based, so they want their candidates hired.
- Contingency recruitment negotiates fees based on salaries. The higher your fee, the higher the salary, which equals a healthy commission.
- The recruiter will represent the candidate before the company to get them hired at a high salary.
- Often, recruiters interview candidates, but depth might vary because they don’t want to work for free.
- Usually, recruiters work along with a team, competing against them.
- There are many positions to fill fast, so the recruitment process is quickened to boost commissions.
- Recruiters rarely spend much time asking questions, so they might not understand the position or send appropriate candidates.
- Agree to a lower fee if you don’t want to get many resumes.
- If you prefer to see actively-seeking candidates, a contingency recruiter is the best choice. Otherwise, you need a retained search firm to assist.
The Difference Between Retained Search and Contingent Search Firms
It’s crucial to develop and hire strong managers and executives. Organizations understand the need for leadership to face their challenges, but it’s often difficult to recruit, assess, and find the best talent.
If you’re interested in outsourcing the leadership hiring needs, you will want an executive search firm ready to assist. However, it’s important to understand the differences between retained executive search and contingent search.
What’s Contingent Search?
This model is often used for niche or hard-to-fill contributor roles, which are below the VP or Director level but can include C-suite needs. Most organizations use several firms to get multiple resumes to fill their positions quickly.
Advantages of Contingency Recruiters
- The goal of the firm is to generate many prospects rapidly that meet the qualifications for the role. Recruiters vet them to ensure that their compensation, experience, and skills match but rely heavily on postings to attract people actively looking.
- These contingency firms often charge lower fees than with a retained search model.
- As the name suggests, contingency search firms only get compensated when a candidate is successfully placed or hired. They usually provide limited guarantees, but that means you don’t pay an upfront fee.
What Are Firm-retained Executive Search Firms?
Retained search firms are often best when an organization must fill a confidential, specialized, or critical role, such as a C-level or Director. This is a higher-end service, so companies work closely with the retained search firm. It’s on an exclusive basis for as long as it takes, but there’s a minimum period involved.
Generally, retained search firms target passive candidates when sourcing and recruiting new talent. In a sense, they’re not actively seeking employment and work at high-end companies.
Generally, a retained executive search could take up to 180 days to finish, though the timeline might be longer since the firm has to engage these prospects and identify options for the opportunity.
Advantages of a Retained Executive Search Firm
- Instead of leaning on active job seekers, the retained search process focuses on databases containing passive and qualified candidates and concentrates more on referral networking.
- By using the expert knowledge they gained in the marketplace, retained firms can target and engage the top-performing talent key competitors use.
- A retained firm assigns a dedicated team to fulfill the client’s requirements.
- Retained recruiters perform a more in-depth vetting of the qualifications to gauge how the individual might align within the organization. This ensures they get three to five options. Most retained firms provide the hiring managers with an executive summary report explaining the person’s behavioral profile and past performances.
- Retained executive search services remain connected to the organization through check-ins or status calls. They offer more insight and information into the recent market to shed light on resistance and below-market compensation options for better employment opportunities.
- Generally, retained firms are authorized extensions of the HR or recruitment team and represent the company’s brand and messaging within the market. Therefore, more consideration and thought are given to this.
When to Use Contingent Search Firms
Generally, a contingent search firm is used when looking for a first-level manager or individual contributor that will earn $150,000 or less each year. Consider contingency recruitment if:
- Your company has an urgent hiring timeline or budget constraints. Leveraging one or more firms that compete against each other can give you potential candidates more quickly.
- Your HR team or internal acquisition team can’t handle the executive search needs for niche or hard-to-fille jobs that are in high demand.
When to Use Retained Executive Search Firms
If you need someone at the senior level, retained search might be the best choice if:
- You require a dedicated recruitment partner.
- The search is confidential, or you don’t wish to make a mistake.
Be prepared to pay higher retained search fees. Usually, 1/3 is due at the start of your search, 1/3 is paid within 60 days, and the rest is compensated upon a successful hire.
Choosing Appropriate Contingency Firms Matters
Understanding the contingency and retained executive search process is crucial to choosing the right approach to find candidates.
For a free hiring consultation, contact The Quest Organization at firstname.lastname@example.org or 212-971-0033.
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