Executive recruiters (also headhunters) are special employment agencies retained by employers to seek out top management talent for their clients. The percentage of your firm’s potions filled by these services might be small. However, these jobs include key executive and technical positions. For executive positions, headhunters may be your only source of candidates. The employer always pays the fees.
There are two types of executive recruiters – contingent and retained. Members of the association of Executive Search Consultants usually focus on executive positions paying $ 150,000 or more, and on retained executive search. This means they are paid regardless of whether or not the employer eventually hires the executives through the efforts of the research firm. Contingency based recruiters tend to handle junior to middle level management job searches in the $50,000 to $ 150,000 range. Whether retained or contingent fess is beginning to drop from the usual 30% or more of the executive’s first year pay. For example, in one survey about 96% of clients paying executives search fees paid the full 30% in 2000. This dropped to 77% in 2001 and to 70% in 2002.
Two trends – technology and specialization are changing the executive search business. Most recruiting firms have or use Internet linked computerized databases the aim of which, according to one senior recruiter, is to create a long list [of potential candidates] by pushing a button. Korn / Ferry has an internet service called Future step to draw more managerial applicants into its files.
Executive recruiters are also becoming more specialized and the large ones are creating new businesses aimed specially at specialized functions or industries. For example, LAI Ward Howell launched a new business specializing in financial executives with bases in London and New York.
Pros and Cons:
Recruiters are often irreplaceable. They have many contacts and are especially adept at contacting qualified, currently employed candidates who aren’t actively looking to change jobs. They can also keep your firm’s name confidential until late into the search process. The recruiter can have top management’s time by advertising for the position and screening what could turn out to be hundreds of applicants. The recruiter’s fee might actually turn out to be insignificant compared with the cost of the executive time saved.
But there are pitfalls. As an employer, it is essential to explain completely what sort of candidate is required and why. Some recruiters also may be more interested in persuading you to hire a candidate than in finding one who will really do the job. Recruiters also claim that what their clients say they want is often not really what the clients want. Therefore, be prepared or some in-depth dissecting of your request.
Guidelines: In choosing a recruiter, guidelines include:
1) Make sure the firm is capable of conducting a thorough search. Under their ethics code, a recruiter can’t approach the executive talent of a former client for a period of two years after completing a search for that client. Since former clients are off limits for two years, the recruiters must from a constantly diminishing pool.
2) Met the individual who will actually handle your assignment
3) Make sure to ask how much the search firms charges. Get the agreement in writing.
4) Never rely solely on the executive recruiter (or other search professional, such as employment agency) to do all the reference checking. Certainly, let them check the candidates’ references, but get notes of these references in writing from the recruiter (if possible). And, in any event, make sure to check at least the final candidate’s references yourself.
On demand Recruiting Services (ODRS):
A service that provides short term specialized recruiting to support specific projects without the expenses of retaining traditional search firms.
ODRS provide short term specialized recruiting assistance to support specific projects without the expenses of retaining traditional search firms. They are basically recruiters who get paid by the hour or project, instead of a percentage fee. For example, when the human resource manger for a biotech firm had to hire several dozen people with scientific degrees n expenses in pharmaceuticals, she decided an ODRS firm was her best option. A traditional recruiting firm might charge 20 to 30% of each hire’s salary, a prohibitive amount for a small company. The ODRS firm charged by time, rather than per hire. It handled recruiting analysis and prescreening and left the client with a short list of qualified candidates to put through the employer’s own internal screening process.