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Why and when to choose retained over contingency?

Whatever your views are on the “War for Talent”[1] it is indisputable that at the forefront of our client’s agenda are the twin goals of attracting and retaining the best talent in a highly competitive market. The global disruption of the Pandemic may have initially led people to believe this War would abate, retreat, white flag waving, but this is not the case. Employers whether they are growing or consolidating, understand that their competitive advantage is derived by harnessing the abilities of their top talent.

Attraction and Retention are the main tenets or key pillars where the war for talent rages.

The dual nature of attraction and retention matters at many levels of staffing and across many sectors, but the Senior / Executive search sector is where making the wrong hire can prove most costly.

Getting these key hires right is imperative to the success of your company, vision and culture.

Indeed, the Recruitment Employment Confederation finds that the actual cost to a business of making the wrong or bad hires can be as much as and maybe more than 3 times the salary of the employee. This considers the time spent hiring, advertising, training and recruiter fees as well as the hidden costs such as loss of productivity due to the lead in time with a new employee and staff turnover directly related to hiring someone who is a bad cultural fit or damages your team environment. Employers should also consider the cost of losing potential customers and the reputational cost to their brand.

Imagine hiring someone who is divisive, upsets many people in your business so that they start to look elsewhere themselves? Or imagine hiring someone who rubs your customers up the wrong way, loses you a deal that has significant company-wide ramifications? These situations do happen unfortunately, and that is why how you approach the “War for talent” matters.

So – Contingency or Retained?

Contingency – Also known as “No win no fee” recruitment.

Working with several agencies where there is no initial fee outlay may seem to be giving you the most exposure to the candidate market but, it is rarely the case. Why is this? It comes down to commitment and accountability or lack thereof. Firstly, from the agencies and secondly from yourself – the client. This first pass the post system doesn’t lend itself to a tailored or thorough approach. There is no weight of accountability resting in one place – it is simply a race. Commitment and accountability will be in short supply when the agencies realise this could be an exercise that reaps no benefit in terms of payment. Many will be working for free, and they aren’t contractually obliged to produce results.

So why retained search?

Commitment, Accountability and Time

Commitment works both ways and working with one search consultancy, paying for their time and ongoing work creates a partnership relationship where all parties are accountable for the success of the assignment. By allowing this search provider the time to fully immerse themselves in understanding your business, as well as the time to create bespoke PR and marketing materials including employer branding and employee value proposition, you are ensuring that the process is off on the right footing. Time is clearly of the essence but without enough time what level of service are you getting? Competing agencies are forced to sacrifice quality of service for speed of response when they pitted against each other.

Transparency, Market Mapping and “The longlist”

Working with one search provider collaboratively allows all parties to be completely transparent when it comes to the search. Using a variety of methods, including both in house and external researchers, a retained Executive search firm can finely tune their search, mapping the market to give you a very thorough understanding of what the entire candidate market looks like. This is known as the “The Longlist”. This is shared with clients and compiles information gathered across social media, linkedin, trade journals, networks, other research activities and PR and marketing campaigns.

PR – bespoke advertising and employer branding opportunities – The candidate pack and value proposition

At Artemis when we work on a retained basis, we create bespoke marketing campaigns for each and every recruitment campaign. These are specifically tailored to attract the best talent and our in-house marketing team use strategic methods to place these in front of the right candidates. Selling your company properly to potential candidates and clearly showing the employee value proposition is what gets a passive candidate into the frame of mind where a new opportunity can be explored. Showcasing our client’s culture, vision, mission and values in a detailed candidate pack allows them to digest fully the opportunity on offer.

Psychometrics and Cultural fit

Getting the right person for your team doesn’t just come down to skills. They also need to have the right behaviours and cultural fit. Understanding how paramount this is on retained senior level assignments, at Artemis we create a candidate profile based on a human job analysis. This shows us what good looks like from a behavioural point of view. Understanding your long-term goals as a business, along with team culture and environment are all key to the overall success of the appointment and longer retention.

Working with a recruiter who understands your business, has been paid for their time and services and is as invested in the process as you are ensures a much closer collaboration, in-depth analysis of the market and ultimately a better service with a better outcome.

If you value getting the right people for your organisation then retaining an Agency is a clear demonstration that you mean business.

[1] This “War for Talent” phrase was coined by Steven Hankin of McKinsey & Company in 1997, and a book by Ed Michaels, Helen Handfield-Jones, and Beth Axelrod, Harvard Business Press, 2001.