The secret of my success is that we have gone to exceptional lengths to hire the best people in the world.
Steve Jobs
Without a doubt, the job market is incredibly challenging right now. Top talent is always hard to find. In order to avoid hiring mistakes and lengthy delays you should carefully consider the type of recruitment service you require.
Working with a recruitment agency is one of the alternatives, but what kind of agency and service should you look for?
Retained search and contingent recruitment are two of the most popular services. Although they both follow similar principles, they should only be utilized in certain circumstances, based on your needs.
So, what are differences between retained and contingency searches and what are the advantages and disadvantages?
Retained search: What is it?
Recruitment agencies use the term “retained search” to refer to “headhunting,” a proactive recruiting method. This type of recruitment search is a partnership between the client and the recruiter, shortlisting the best and most qualified candidates.
Retained search entails paying a fee in advance and produces an exhaustive market analysis to discover the best talent, not simply the available talent. As an extension of your brand, the search agency will work only for your company and will only bring quality candidates to you and will not shop around the best found talent to your competitors.
Advantages of retained search
Reliable: Because of the cost structure and consistency of a retained service, it is reliable work from the recruiter’s perspective. Traditional search businesses provide a lot more dependable service since they will never accept an assignment that they cannot complete and so, the risk is very low. For instance, at The Sales Experts, we use our hybrid retained search service and fill 98% of the positions that are given to us.
There is an almost 100% guarantee when working on a retained basis.This is because of the market analysis that is done, as well as the agreed-upon deliverables and briefs, which are made before the search begins. For the purpose of determining whether a search firm would be a good fit for you, you should always inquire about the firm’s fill rate and previous success rates on similar searches.
Comprehensive go-to-market strategy: Retained search includes a far more thorough go to market strategy that will be pre-agreed upon, in addition to market analysis and headhunting. This guarantees correct representation of your company/brand as well as effective marketing and attractive opportunity presentation. For startups or those with little market presence, this can be especially useful. Retaining a recruitment firm delivers more of the agencies time and resources.
Research in-depth: Retained tasks are built on in-depth market analysis. Along with this, there is a lot more structure to the processes and the manner in which applicants are presented, whether this is done through a long list or a formal report that includes important details about each candidate. Additionally, retained recruitment typically uses more sophisticated interviewing procedures that allow candidates to be thoroughly vetted and qualified across a spectrum of hard and soft abilities.
The disadvantages of retained search
The largest disadvantage of retained search is upfront cost, which might occasionally discourage organizations from partaking in the process altogether. However, there is a much higher guarantee of return on investment when undertaking a retained search, both monetarily and in terms of time.
Longer procedure in some instances: Although contingency hiring can also be time-consuming, retained search is inevitably longer due to the amount of market analysis that is done.
What does contingent hiring entail?
A contingency search firms typically works under a “No Win, No Fee” method. Meaning, the service is performed for free by the search firm until the day the proposed talent accepts the position with the client. It’s a widespread method of hiring that may be applied to junior, midlevel, and senior-level positions. And currently the vast majority of recruitment agencies globally work on a contingent basis.
The benefits of contingent hiring
Pay on achievement: Working with a recruitment firm on a contingency basis entails no upfront financial commitment, which is why many organizations find it so appealing. The pay on success strategy makes sure that you only pay for the contingent service after the applicant enters your company.
Access to excellent prospects: A contingent search can nevertheless result in outstanding applicants, especially if it is conducted in conjunction with a specialized recruitment firm.
Recruiters typically have better candidate relationships the more specialized they are. As was already noted, contingent recruiting is one of the most popular services, thus to ensure successful collaborations with their clients, recruiters must continue to build strong ties with top talent. If your existing recruitment agencies aren’t working well, seek for one that specializes in the field you’re trying to fill.
The drawbacks of contingent hiring
No assurances: Contrary to retained recruitment, contingent recruitment offers no assurance that the candidate will be hired. Recruiters typically work on several positions at once, so unless you pay for it, you won’t get priority. You should undoubtedly think about a retained basis if it is a top priority or really specialized hire.
No exclusivity: Working on a retained basis ensures exclusivity, which means that during the interview process, you and you alone will have access to this talent. Because of the contingent approach, a recruiter who has numerous clients on their client database is perfectly permitted to send a great candidate to more than just you.
Lack of thorough market research: While contingent recruitment does require research to discover prospects, it is not as involved as a retained search approach would be. Although the approach will still be research based, it won’t delve into the level of detail that is required for more challenging search jobs.
Differentiation: It’s more difficult for recruiting agencies to sell your organization to potential applicants if you’re a smaller company with little brand recognition, or working in a highly competitive industry. Although a recruiter’s duty is to advertise your company and excite people about it, it’s difficult to achieve this completely on a contingency basis if you don’t already have a strong brand presence.
Last thoughts
In conclusion, both retained search and contingency recruitment have advantages and disadvantages. It’s crucial to choose the appropriate provider at the appropriate time because there are certain circumstances in which it would be advantageous for you to do a retained search rather than a contingency search.
To select the ideal recruitment partner, make sure that you have researched the industry and spoken with numerous recruitment firms to understand what they are actually delivering.