Before hiring an executive recruiter, it’s essential to understand the key differences between the various types of executive recruiting firms. Those unfamiliar with these differences might mistakenly use the terms “staffing agency” interchangeably with “executive recruiting firm”. While the basics are similar, hiring the right type of executive search firm will determine your hiring success.
Let’s begin with the basics.
What is executive Recruiting?
Executive Recruitment or Executive Recruiting refers to the process of identifying, attracting, interviewing, selecting, hiring, and onboarding leadership and c-suite employees. In other words, it involves everything from the identification of a staffing need to filling the leadership position.
What is aN EXECUTIVE Recruiting Company?
An Executive Recruiting Company (also referred to as an Executive Recruitment Firm) is a company that recruits (sources) leadership candidates for open jobs. An Executive Recruiting Company is hired by an organization when they have an open leadership job. A company will typically hire an external Executive Recruiting Firm when they need assistance identifying leadership candidates. This situation may occur for several reasons, such as the lack of an internal executive recruiter or the pool of qualified leadership candidates is small due to specialization or current employment rates.
There are different types of executive recruitment firms. The two most common are Executive Search Firms and Staffing Agencies.
Executive Search Firm
An Executive Search Firm is a company that primarily recruits professionals at the executive and mid-level. They may also be referred to as an executive search agency, executive headhunters, or an executive recruiting company.
Companies that recruit temporary junior to mid-level professionals are referred to as staffing agencies.
How do executive recruiters make money?
Executive Recruiters are paid for their services by the company that engages them. The primary difference between retained executive recruiting and contingent executive recruiting is when payment is received for recruiting services. There are benefits and clear differences in the executive recruiting services received in each scenario.
Retained Executive Recruiting
When an organization engages a retained executive search firm or headhunter, the hiring company pays an upfront fee before the executive recruiters search for, identify, and present leadership candidates fill an open job. The hiring company also agrees to work exclusively with the executive recruiting firm. Often the executive recruiting firm will receive percentages of the total fee at various milestones during the executive search, such as presentation of the first five leadership candidates, when interviews begin, and when the offer is given to and accepted by the leadership candidate of choice.
Contingency Executive Recruiting
When an employer hires the executive recruitment firm for a contingent search no upfront fee is required. Instead, the executive recruitment company receives payment only when the executive candidate they present is hired by the organization. A company may engage more than one recruiting firm or headhunter if they are taking the contingency recruiting route.
What are the benefits of using an executive recruiting firm? How do I select the best Executive recruiter? Why use a retained executive recruiting service versus a contingent executive recruiting service?
There are many benefits to working with a retained search firm like TurningPoint Executive Search. First and foremost, retained executive searches yield higher caliber leadership candidates who fit most, if not all of a company’s needs. Executive recruiters & headhunters with a proven track record of making successful leadership placements (and the retention rate to back it up) will help you find dynamic new hires that will be successful and are more likely to stay long-term.
More often than not, a company will choose to retain an outside executive recruiting firm rather than utilizing an in-house hiring manager exclusively because of the complexity of the role or the organization itself. Retained executive recruiters have a deep pool of leadership candidates, many of whom are not actively looking to change jobs. These employed, top-performing, passive executive candidates can be hard to find. Retained executive recruiters invest time to research and maintain deep networks across industries, domains, and job functions. Additionally, retained executive search firms are typically working on fewer leadership roles at one time, allowing the executive recruiter or headhunter to dedicate more time to search deeply for high-quality leadership candidates other executive recruiters would miss. These key differentiators between hiring managers and retained executive recruiters are extremely important to consider when searching for uniquely qualified talent or a senior-level, high-salary, pivotal position.
Executive recruiters tip: Investing in an executive hiring expert with a “partner” mindset who is knowledgeable across industry and job function will help you find higher caliber leadership candidates.