Retainer Search – Dead or Alive?

Retainer Search – Dead or Alive?

Although some commentators have predicted the demise of retained executive search in

its traditional form, statistics gathered by the AESC indicate that the profession is, in

revenue terms, alive and well. Nevertheless, some search consultants are concerned

about what really constitutes retainer search in today’s environment and how to define

it. They worry that the sands are shifting under the profession and that some parameters

of retained executive search have changed for the worse.

Let’s try to examine the issue with a dispassionate eye (although please note that the

AESC cannot comment on, or suggest, pricing models due to legal constraints)

Increasingly Sophisticated Clients

Established practitioners of search are familiar with the arguments as to why a retainer

contract, backed up by financial commitment, is essential before embarking upon an

executive search assignment. So why is it that some clients have begun to deal with

executive search firms more as contingent vendors rather than as consulting partners?

The client’s increasing level of experience with using executive search is partially

responsible for this. But it is unfortunate when the client’s greater level of sophistication

manifests itself only as muscle flexing, rather than in the form of enlightened partnership.

Terms such as “skin in the game”, and payment for results have entered the lexicon. It’s

as if the brain surgeon or criminal lawyer is being asked to make a commitment to

success before embarking upon their task. Fail and you will not be paid has a ring of logic

about it and yet it can strike at the very roots of professionalism and ultimately high

quality delivery.

The AESC View

The AESC view is that differentiation of retained search from other types of recruiting

should be on the basis of the quality and nature of the services provided, and on the

nature of the relationship with the client, rather than on the basis of terms and conditions

alone. Senior executive search is not a commodity service and it is unrealistic for any

client to suggest that it is. However, in the absence of compelling relationship

management issues that preclude a "commodity" mentality , human resource, internal

recruiting and purchasing departments are not only sorely tempted to force the terms and

conditions to the front of the discussion with search firms, but are sometimes required to

do so by senior management intent on controlling costs.

In its Professional Practices Guidelines the AESC describes the comprehensive

processes that are at the core of retained executive search consulting, as well as the

“retainer” nature of the agreement with the client that provides the foundation for this

specialized form of management consulting. We all know that the processes involved

include detailed research, confidential networking,careful assessment, scrupulous due

diligence and skilled diplomacy and negotiation. These are not commodity processes.

The Search Consultant’s Challenge

Thus the consultant’s challenge in the changed environment is to not only continue to

provide a superior service but to build such strong and unbreakable client relationships

that there is no temptation for the client to use terms and conditions as a blunt instrument

of control. The consultant must remind the client that a quality professional

representative in the marketplace can do much to project an image of serious

commitment and intent for the corporation as well as have a positive impact on the

potential candidate.

There is evidence that clients are increasingly reviewing how best to obtain value from

their search firms, not only by sharing information and experiences with other clients but

also by applying professional criteria instead of subjective evaluation of the search

process. They recognize that to obtain best value from executive search they too must

invest in the relationship in an intelligent and sophisticated manner.

The best search firms should be willing to analyze their performance track records and

discuss them with the client. By getting ahead of this process and also helping clients to

review their recruiting and retention processes the search firm will demonstrate client

commitment and will focus on upgrading quality and service and thus the underlying

relationship with their clients. In that context terms and conditions of the retainer contract

should diminish in importance. A new dialogue with clients on the basis of longer term

relationship building rather than on transaction fees may now be required.

Marketing Retained Executive Search to Clients

The following are a few phrases/ideas that we hope may help with marketing retained

search.

Why Retained Executive Search?

• Recruiting executive talent is a critical and strategic responsibility - one of the

most important performed by management.

• Retained Executive Search consulting is management’s professional partner in

fulfilling this responsibility. Its role is to understand the recruitment context and

to apply creative thinking in identifying and attracting appropriate candidates.

• Retained Executive Search consulting is objective and confidential. Its expertise

is in the evaluation of talented individuals and in detailed knowledge of the

marketplace.

• Once initiated, execution of the hiring process requires painstaking research,

sensitive handling, active management and speed. Retained Executive Search

delivers all of these.

The Value Proposition

• You often get what you pay for. Don’t stint when buying a critical service – it’s

not worth short-changing your organization.

• Retained Executive Search adds power to management by providing a focused,

specialized and leveraged service to achieve a critical objective – identifying and

successfully recruiting a key executive. This is power worth paying for.

• The fee is only a fraction of the contribution that the right person can make to the

organization. Equally, the fee is only a fraction of the cost of getting it wrong.

Process

“The beginning is the most important part of the work” (Plato)

• Senior executive recruiting is a key task – perhaps the most important performed

by management. Get it right at the start.

• Integrity, professionalism, confidentiality, sensitivity – crucial elements of service

you can’t afford to compromise.

• Retained Executive Search consultants do not unilaterally present candidates. It is

about consultants who work with you to find the best solution.

• You will not get the attention, level of service or level of consultant you need for

a senior executive recruiting assignment without a retained commitment.

• Retained Executive Search requires an ongoing commitment and focus – search

consultants only handle a limited number of searches each year.

                                           SOURCE:     AESC

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