What is the difference between a retained search firm and a contingency firm?
Before hiring an executive search firm, you need to understand the differences between the two and how they serve your mission. Here are some of the major differences:
Candidate-driven versus client-driven. That’s a contingency firm versus a retained search firm. The differences are as far as heaven is from earth.
A contingency firm can have as low numbers as single digits, and generally less than twenty percent fill rate. Bottom line is they get exposed to mediocre candidates. Consider the pool of candidates that contingency firms go fishing in. They’re on job boards. They’re on social media. They’re on incoming résumés. These are candidates that your competitors just laid off. I call this the pool of the best of the worst.
If today you had to lay off twenty percent of your workforce, would you let off your best twenty percent or your worst? Well, let’s face it. The people you lay off today are going to be in that pool tomorrow. Is that where you want to be fishing?
Another issue to consider is understanding how contingency firms get paid and what’s their motivating factor. At the end of the day, they are commission-driven. And in fact, the lower you negotiate your fees, the lower the priority you’re going to get on the totem pole. They’re going to be looking to place their best candidates at the highest-paying commission companies. HR Department can do the same job as your contingency firms can. They’re going to be fishing the same pond, looking in the job boards, social media, or wherever those résumés can come in.
Now, let’s take a look at the retained search firms, which is what JK Consultants is.
They exercise direct recruiting and focus in on identifying who your competitors are and who are the best people within those organizations. And then they penetrate those companies and recruit those candidates.
Now, retained search firms are committed to your success. They put all their energy and resources focusing in on your needs and they’re in alignment with your needs. We, at JK Consultants, practice those steps. We are client-driven and have the same mission as yours.