The life of exclusive recruiting is far different from the traditional non-exclusive contingency search model. Our recruiters far prefer the focused and committed client to those who go the “Press Your Luck” route. While we have seen a huge uptick in exclusive search partnerships this year, there are still times when a non-exclusive model is elected. It should be noted that at Millennium Search, an exclusive search does not have to mean pre-paid, non-refundable retainers. Exclusive searches can still be contingent upon the hiring of our referred candidate, without any money paid until then. Here’s how it can work for your hiring situation.
Press Your Luck
Straight contingency searches mean that you have a role you would like to fill, and don’t know who to trust to fill it, being hesitant to put all of your eggs in one basket, so to speak. As a result, you sign on a bunch of different firms to go out and find you candidates. Whomever delivers the best one first, wins their negotiated fee. There can be price wars amongst the firms as to fee pricing, but your hand is not forced to pay until you make the hire. Often, roles that do not involve highly experienced level work tend to get put out for contingency “bid” so to speak, because companies don’t want to pay a lot to find someone that shouldn’t be that hard to find to begin with. The reality is that when you bring on a bunch of firms to “compete” against each other, they dilute the pool. The more times candidates are contacted by recruiters, for the same openings, the less interested they become. Or they begin to realize that this hiring company must be really desperate to have asked so many people to hunt down candidates. And so, they interview with that knowledge as leverage in negotiations. Which drives your comp offer higher and results in higher recruiting fees.
Non-exclusive contingency searches can begin to feel like a feeding frenzy and put a lot of stress on all parties involved – from hiring company to recruiters to candidates. And because there often end up being too many cooks in the kitchen amongst all those partnered recruiting firms, there is less time for detailed communication between company and all those recruiters, and therefore less knowledge for the recruiters to use about what your needs are and whether the candidates fit. This is not to say that non-exclusive contingency models are a waste of time – it is just to emphasize how often hiring companies misunderstand its reality.
If you have a lower level hire that needs to be filled, and you don’t have the time or knowledge about the candidate search process, by all means, engage on a straight contingency with one or two quality firms that you have vetted for experience and success within your industry, stage and type of role. But remember, just because a firm is super responsive doesn’t mean they are super successful. It could be that they have nothing else to do. Or that they appear to be hard workers when really, they are just throwing the pasta against the wall to see if it sticks, instead of doing the right due diligence on your behalf.
You see, without any serious commitment from your end, firms will submit an initial round of candidates and, if there’s no luck right away, they will cut ties and move on to the next client’s opportunities. They don’t owe you anything, after all. And they can’t waste valuable time and resources on opportunities that are less than promising.
Unique Hires Need Devoted Approach
Now, how can an exclusive contingency model produce better results? Because you are committing to one firm for a set window of time and not diluting their efforts. Any firm worth its salt should have a solid network to work from. This is not to say a database of resumes. This means a true network that its recruiters can turn to for referrals and introductions to passive candidates not on the market. A network and skill set that can pry such candidates from their current positions and into your company. Recruiters don’t like to hit up their network for these primo candidates unless they know the candidate has a real opportunity and their consideration won’t be wasted. Presenting such top talent to a job with an unfocused, frazzled hiring company in the midst of a straight contingency search means that candidate won’t get a fair shake and is unlikely to listen to the recruiter next time around. These candidates are exactly the quality that you start to see when a search turns exclusive.
We had a company seek us out last quarter who has a very unique business model and a long-tenured VP reporting directly to the CEO who was retiring. Their focus is on the electrical industry, helping thousands of manufacturers and distributors connect their supply chains and business processes. And here they were, in need of a new VP Sales & Marketing hire who needed to be an innovative strategist relative to sales, business development and revenue generation. The company needed someone to drive their expansion plans in both existing and new markets, with demonstrated success in this industrial vertical. Throwing pasta against the wall was not going to cut it here. This was specialized. The company wanted to secure the right partner, at the right price, without wasting time. They were focused in what they needed and wanted a recruiting firm that would devote their energies toward the same goal. By engaging in an exclusive relationship with our Senior Partner, Sandy Bleich, they valued her time and resources and provided productive feedback, communication and receptiveness to her insight along the way. They did not muddy the waters with other outside firms or internal efforts. She valued their needs and focused her skills on that elusive passive candidate network that our firm specializes in reaching. The hiring company vetted our firm and our recruiter, and gave us an exclusive opportunity to get the job done. Our candidate started the job within three months of our partnership with their firm. And nothing was paid until that happened. But the skin in the game is in the commitment to our experience, network and proven results. That trust allows us to spend more time with our network on their behalf.
Congestion Means You Need Specialization
Another Q2 exclusive contingency search involved a Bay Area firm. As the world knows, the market around San Francisco is congested to say the least. And the cloud based messaging and collaborative platform arena is also competitive covering desktop, mobile, directory and real time applications and services. There is not a lot of impetus to dive into a Bay Area search for a Senior Director of Product Management in the cloud vertical, given the dynamics of the region and candidate pool. These are the types of roles that hiring companies often make the mistake of going non-exclusive for their recruiting models. But in this scenario, the role had high visibility reporting to the CPO. They didn’t want to have any missteps when hiring the right person responsible for the existing client platform as well as lead strategy and delivery of their next gen platform. They agreed to partner with us exclusively for a set period of time on a contingency basis, meaning that they did not have to front any funds, but did have to commit to solid discussions and evolving criteria for their desired proven, creative and collaborative management leader that could thrive in their fast-paced environment. Again, within three months from the start of our partnership, this company was able to hire our candidate who is applying their design-thinking techniques to a metrics-driven experience, and their passion for listening to the customer, to deliver world class user experiences right now. This has immediate impact to the company’s growth and bottom line. The exclusive search model is not delaying the hire and limiting the company’s revenue. It did not extend beyond the financial quarter. And it did not break the bank.
Our exclusive contingency model fees are often less than straight contingency. We know that to make a competing model work for us, we have to have high reward for that risk. But when a hiring company wants to partner with us for an exclusive search, we offer more affordable rates. There isn’t as big a risk to success. And the reward is substantial. You get the right hire, for the role you need, in the timeline you have to have. Budgets don’t get spent in advance, and departments or divisions don’t get delayed growth waiting on something to stick to the wall.