Frequently Asked Questions

In most cases, no. It is far more important that you find a recruiter who will bring you the best candidates than one who happens to be based nearby.  This is particularly true when the assignment in question will involve looking for executives nationwide (or worldwide). Many effective searches are completed by recruiters operating out of different cities than their clients. Frequent telephone contact and occasional meetings can work well.

The largest recruiting firms do maintain offices in major cities around the world. This can be an advantage if they can bring local knowledge to bear in finding good candidates. These candidates can then be interviewed in person by the local office before going to the expense of flying them to see the lead recruiter and client.

If an assignment demands a local executive be hired, then it does make sense to use a hometown recruiter. Consider local presence as a tie-breaker between otherwise comparable search firms.
Executive search firms may be members of various professional organizations. If they specialize in particular industries or functions, firms will often participate in the relevant association. Although simple membership may be no guarantee of expertise -- since entry requirements and standards vary -- it can be a useful clue when choosing among recruiters.

Executive recruiting firms have their own New York-based professional association called the Association of Executive Search Consultants. The AESC was founded in 1959 and now has over 100 member firms including most of the largest in the business. Membership in the AESC is indicated in the listings.  For a client, AESC membership is perhaps less important than whether a firm adheres to the professional standards set down in the association's Code of Ethics. This code is intended to assure clients of a confidential relationship with their recruiter as with a banker, lawyer or accountant.

Some individual recruiters are members of the International Association of Corporate and Professional Recruitment (IACPR). This association maintains entry requirements, and members must pledge to honor the group's ethical code.
Once an executive search firm has been selected, the multi-step process of professional executive recruiting begins. Each step is managed by the search firm in partnership with the client team. Successful results require diligence during each phase of the process. The key stages of executive search are:
  • evaluation of the employment need
  • research
  • candidate screening and reference checking
  • candidate "short list" identification
  • interviews 
  • negotiations 
  • hiring
The search begins with extensive evaluation of the client need. The search firm works closely with the client to arrive at a thorough understanding of the company, its culture and organization, and the specifications of the position to be filled. Job specifications include title, department definition, reporting structure, and details of compensation.

Once prepared, a draft of the position description is submitted in writing to the client team for approval. It is imperative that the job description reflect a clear understanding and agreement between the client and search consultant before proceeding.

When the job description is finalized, the intensive research phase of the search commences. The search firm engages in extensive industry research and networking; existing sources are contacted, leads are vigorously pursued. If the client wishes, an internal search of the client company can be performed to identify company employees suitable for possible promotion.

Based on research well underway, the search firm contacts prospective candidates by telephone and begins screening interested and promising candidates. Personal interviews ensue in parallel with thorough reference checking activities.

Good recruiters regularly report their progress and, at some agreed-upon point, present a strong candidate pool to the client.  Recruiters sometimes recommend the best candidate(s), though the client and recruiter often arrive at an initial selection of the most promising candidates. Client interviews are arranged with the best two or three prospects. The search firm prepares the client to meet the candidates and may or may not attend the interviews.

After the successful candidate has agreed to accept the position ¬ and when candidate and client have agreed to acceptable terms, the dynamic aspect of the search effort is complete. Most search firms "guarantee" their executive candidates for 60 days (contingency firms) to a year or more (retainer firms). The firm will replace such an executive should he or she leave the client company for any reason. Often these replacement searches are free or at a greatly reduced price. Though a sensitive topic, clients need to have a clear understanding of the search firm's replacement policy and all fees associated with such searches. The search firm stays in touch after the new hire comes on board to help smooth the transition and assure client satisfaction.
Executive recruiters liken themselves to problem solvers. Clients constantly face dilemmas whereby the solution calls for just the right person (or people). Search pros are brought in specifically to fill that void. Even though search pros account for less than 15% of all new job hires in any given year, they are identifying the managers whose actions will have vast repercussions on an organization.

Making the right executive hire pays huge dividends for the client. The right choice can dramatically increase a company's value, and that value rises exponentially as you move up the management chain. So from the clients' perspective, retaining an expert to identify these candidates makes perfect sense. The fees associated with any particular search become almost incidental considering the ultimate payback.
About 75% of all searches are successfully completed.  For those that are not, the reasons are usually straightforward:
  • clients cancel the search, usually for budgetary reasons 
  • clients cannot agree internally on job descriptions or continually change the descriptions 
  • compensation for a specific position does not coincide with what the marketplace demands
Most search pros try to achieve 100% client satisfaction. It is fairly clear to gauge this in the contingency world since recruiters' fees are directly tied to hiring the candidate they have identified. Retained recruiters, meanwhile, face a different situation. Although they get paid regardless of the search's outcome, retained search pros tend to go to even greater lengths to maintain good client relationships.

Another point that should be covered is the so-called "Off-Limits" policy, under which the recruiter is barred from recruiting from the client for a specified period. Some clients want this spelled out very carefully, others do not give it much or any significance. Our point is that the issue should be addressed, so there are no subsequent surprises or disappointments.

It is the recruiter's responsibility to help the client define the terms of any search engagement. A good recruiter usually works around the aforementioned obstacles that can lead to failure. The best recruiters take the consultative approach with the client. Such objectivity means search pros may turn down business rather than start a hopeless engagement -- which in the end is a much better prospect for the client.
When selecting an executive recruiter for an assignment, you can choose to work with a firm that operates on either a retainer or a contingency fee basis. The immediate difference between the two working arrangements is simply that contingency firms get paid only if and when they fill a position while retainers require that the recruiting firm be paid regardless of the outcome of the particular search. This distinction is not always clear cut. Some retainer firms occasionally take contingency assignments, and contingency firms sometimes obtain retainers from clients. However, most recruiting firms fall clearly into one camp or the other.

It may seem fundamentally more attractive to pay for success (contingency) rather than for the process (retainer). Culturally, and in terms of working methods, the two types are quite different. Most contingency firms tend to operate like brokerages, working quickly and uncovering lots of resumes. Retainer firms typically assemble a small slate of pre-screened short-list candidates to present to the client. The right choice depends on your particular assignment. Fees are comparable.

When to Focus on Contingency Firms:
  • The job is entry or mid-level management, typically paying a salary of $75,000 or less. 
  • The job needs standardized, clearly-defined skills and experiences. 
  • Filling the post rapidly is more important than locating the "ideal" candidate. 
  • It would be valuable to see many resumes on a continuing basis. 
  • Multiple positions with the same skills need to be filled. 
  • It is important to fill the position at minimum cost. 
  • The post can be filled locally, to save time and relocation costs. 
  • There is a wide pool or universe of potential candidates.
When to Focus on Retainer Firms:
  • The position is senior or top management, typically paying a salary of $75,000 or more. 
  • The search will be a difficult, customized effort in a narrow universe. 
  • Locating the perfect candidate is more important than filling the post rapidly. 
  • It is important to maintain strict confidentiality about the search. 
  • The position is new, involving unfamiliar skills.
Beyond these differences, contingency and retainer firms also tend to specialize in different industry and functional areas, depending on salary levels. Many contingency firms emphasize advertising, fashion, publishing, and mid-level IT specialists. Retainer firms have a strong presence in Board of Director recruiting, investment banking, management consulting, venture capital, and top general management positions.
Refer to “fees” under “the search process” tab
It depends on when the assignment is canceled and the reason for cancellation. It is not unusual for clients to find an internal executive for a position after engaging a recruiter. In this case, the client should normally pay retainer fees on a prorated basis (A contingency firm would not be paid anything).

Sometimes clients change the job description substantially during an assignment so that the recruiter has to, in effect, begin a new search. It is common practice in these circumstances for client and recruiter to negotiate a partial payment on the previous work and begin a new fee agreement.

When the search fails to produce a candidate that the client is prepared to hire or when the executives offered the position turn it down, contingency firms walk away without compensation. In theory, retainer firms will be paid in full, since their agreement is independent of the outcome of the assignment. In practice, there should be some discussion of why the search failed. If the recruiter bears some responsibility, it is not uncommon for the search firm to receive partial payment only or to give the client a credit against future work.

Not every newly hired executive succeeds in his or her new position. When the executive is terminated or resigns for performance-related reasons within a year of being hired, most search firms will agree to find a replacement for zero or modest fees.

Clearly there are a number of ambiguous and potentially awkward situations that can and do occur regarding fees. While these problems cannot be predicted in advance, they can be mitigated if the client selects recruiters on the basis of building a close working partnership, not simply to carry out a hiring transaction.