Due to recent demand, I am posting the notes from a webinar I conducted last year entitled “Is Retained Search Right for You?”
I hope it is helpful to you.
I started as an MRI owner 14 years ago.
Started out with Medical Sales positions and had success fairly fast following the MRI techniques. I placed my first sales rep and then a several weeks later I placed seven of the nine reps for the next training class. I ultimately placed 31 people at this company and saw several people stay at that company for 10 plus years. But because I was working on contingency, there were a more than a few times when the candidates I placed were very short lived. In the vast majority of those situations, these candidates were sourced from Monster.
As I continued to expand my client base, I was often in a situation where I was one of multiple recruiters working on an assignment. I won some and I lost some, just like everyone does.
-But I Quickly learned that a lot of hard work is both unappreciated and uncompensated. I understood this early in my career as a recruiter because I was “cutting my teeth,” but the longer I did it, the more I longed to be respected by the people I worked with.
Problem 1 – Contingency Recruiters are Being Marginalized by Technology.
Fewer and fewer companies will need your services in the future.
Contingency search is not conducive to attracting the Best.
Problem 2 -The nature of contingency. Even if it’s exclusive, there are times you don’t get paid for your work.
It’s human nature to guard yourself so that you don’t spend large sums of time working without compensation.
Peaks and Valleys of recruiting require I take shortcuts to “Hedge My Bets” and make sure that I keep cash coming in. I couldn’t go too long on a search in case it was cancelled or they hired an internal candidate and my future payday evaporated.
Problem 3 – The quality of results suffered because of the shortcuts that HAD to be made.
– Defensive Recruiting – Job Boards
– Candidates were highly mobile, many times shortly after I placed them.
– Their resumes were so public it was common for them to drop out of contention in the 11th hour-
-due to competitive offers that I had no visibility of.
-due to better offers that came after I placed them
-due to timing and circumstances
– I evaluated why this happened and this is what I found.
There are two types of Candidates on the Internet
1. Physically Unemployed
2. Emotionally Unemployed
Both of these types of people have the same reality – PAIN
My clients became their “Soft Landing” which resolved their immediate pain.
I resolved that this was the reality that undermined my results.
The results that I am most concerned about are OUTCOMES beyond the closed placement.
As more and more companies are measuring their cost per hire and determining the value of consultants and vendors, this will continue to be the Metric that has the single greatest impact on our Value Proposition for our clients and by extension, our businesses.
Problem 4 – Dealing with HR, Waiting for Feedback, Returned Calls and of course, not being able to influence the decision makers. The vast majority of HR people are clueless as to how to attract talent.
Problem 5 – I realized that when I am prepping a candidate for an interview, I am biasing the process toward my candidates. Of course it does! That’s how you close deals. I recognized that my priorities were not in full alignment with my clients.
– I was mostly concerned with MY CANDIDATES getting hired than my clients hiring the Best.
– I was forced to skim the internet for WILDCARD CANDIDATES who might FALL into the process by another source and cut me out of the deal. I realized that the reason for this was the TERMS that I was engaged.
I believed that if I were only engaged by my client with money in advance, I could do the best quality of work and truly have their best interests at heart.
I began to realize that although Contingency Search makes sense on the surface, it has UNINTENDED CONSEQUENCES which undermine the relationship between the RECRUITER and the CLIENT.
– After a lot of frustration built up, I knew that I wanted to shift my business into the RETAINED MODEL, but wasn’t sure how.
Whenever I tried to sell a retainer, I kept falling short and would finally accept the terms of contingency and endeavor to prove to them, that I was better than the rest. Realization – Once you engage on contingency, it is almost impossible to change to RETAINED.
I realized that something was missing in my presentation. I couldn’t put my finger on the problem until one day…
– I received a call from a President of a mid-size company who was interested in our firm to conduct a search for a GM of a new division that they were going to start up.
– This couldn’t have happened at a worse time for me.
I was in the middle of an office move and everything was in boxes.
I had just fired my TOP PRODUCER for Dishonesty/Stealing business/cheating.
I had a full desk of Contingency Stuff.
– I couldn’t have been more emotionally detached from the pitch I was giving. Very “Matter of Fact.”
– I knew that I would have a hard time if I added one more thing to my desk.
-So, when it came to how I work, I just said it… We take one third up front, and the balance after we’re done. We’ll have a short list of candidates within three to four weeks. Oh and by the way, it was December!!
– The President said, “OK! Send me your agreement and I’ll overnight you the check!”
– That was my first Retainer and began my quest to go 100% retained.
-Over the next several months, I transitioned my desk to 100% Retained Search.
It was not easy, and required a huge effort and discipline, but it is the most rewarding thing I have done in my business.
After five years in business, my average fee was $27k and last year, my average fee was $130k.
I have elevated my game from dealing with Managers and HR to dealing with CEO’s and Boards of Directors. I went from working on 7-10 searches simultaneously to working on one or two at a time. I went from working with scraps to searching for TRUE TOP TALENT.
I went from finding people who had three jobs in the last five years to placing people who have 15 years tenure in their current company. I went from sifting through the hoards of stacks of resumes to digging deep to find the Absolute Best People in my industry for my clients.
– I went from filling positions to TRANSFORMING COMPANIES!
IF YOU ARE INTERESTED IN DOING THE SAME, I WILL ENDEAVOR TO SHOW YOU HOW IN THE REST OF THIS CALL.
FIRST – Who should do this?
Anyone who is tired of being marginalized.
Anyone who wants significance and respect from their clients.
Anyone disciplined and willing to work hard!
Second – Who shouldn’t do this?
Anyone who loves what they’re doing.
Anyone who thinks Contingency Search is GREAT!
Anyone who doesn’t believe in themselves, if you think you can’t, you’re right!
Third – Lets get started.
1. Develop your STORY – Why? What is your Value Proposition?
What is the difference between CONTINGENCY and RETAINED.
What is your REASON for DOING IT THIS WAY?
If it isn’t compelling, it isn’t effective.
If it isn’t CLIENT CENTRIC, it is a harder sell.
Once your STORY is completed,
Memorize it WORD FOR WORD!
Practice, practice, practice and then practice some more…
Record yourself giving it, and play it back.
Look for Timing, Posture, Verbiage, Clarity, Conviction, Enunciation.
Practice some more! GET it DOWN PAT.
2. Begin Presenting Your Pitch to everyone who will listen. (volume/practice
3. Continue to fill your desk with “C” searches.
“C” used to stand for Contingency, then we had A’s, B’s and C’s Searches and “C’s” were contingency searches.
Today we call them “CRAP” because we won’t do them.
You need to keep your desk full of “C”s so that you can say no to another “C” search.
If you don’t have enough to work on, you can’t sell a retainer because your need is palpable by your client and you will relent. It is only when you are willing to walk away that people will believe you!
The actual terms of how you engage are less important than the WAY you engage.
When I started, I always did 1/3 up front and the balance upon completion.
Whenever possible, and as I became more confident, i merged into a 1/3,1/3,1/3 and then later added expenses and administrative fees.
The actual details are less important than that you are OFF Contingency.
Call it an “engagement fee” or a “Modified Retainer” if that helps, but you have to be able to say NO to contingency.
Why is Contingency Wrong?
Because it is WRONG FOR YOUR CLIENT!
Why is it wrong for your client? That is the only thing that matters.
Contingency is only good for the most ACTIVE/MOBILE candidates on the market.
It is BAD for EVERYONE Else!
Why is it bad for your CLIENT?
1. Recruiters MUST be FIRST
This means that to be successful, you have to be fast on the draw.
Very little Candidate Vetting, if any!
They will scour the job boards finding active candidates that you could have found on your own.
Since it is a race, they can’t take time to recruit someone cold when they are harder to hire.
They need to find people who already are in the interview mode!
Most of the best people are never even approached!
2. Recruiters WILL Coach/Prep
Have you ever hired someone only to find that someone else actually showed up on the job?
Ever wonder why this is? Because if a recruiter only gets paid IF you hire their candidate, The Good Ones will do whatever is necessary to help you hire their candidate
Help re-write the resume to appeal to your preferences.
Coach the candidate on how to appeal to your hot buttons.
Yes, even the stuff you asked them not to…
Conceal flaws and blemishes on the resume as well as in interviews.
Yes, even conceal references that are not positive. (if they even do them)
3. Present the same candidate that they presented to you, to other companies making you compete over the candidate and essentially undermining your process.
They need to make money off their work somehow, and if not through you, then oh well.
You can get to the Finish Line with a Candidate only to lose them to another opportunity.
This doesn’t happen when you recruit a Passive person. (Counter-offer is the main risk)
4. Because your CLIENT only has access to ACTIVE people, they assume FAR GREATER RISK!
1. Candidates Accept another job.
2. Candidates ACCEPT their Job only to NOT SHOW UP!
3. Candidates ACCEPt the job and your job is the bridge to the JOB they REALLY wanted but wasn’t available yet.
4. Candidate ACCEPTs job and ISN”T who you interviewed, they were clearly over prepped and coached. Even embellished their skills and qualifications. (Remember, they were in PAIN)
What is different about how we work?
1. We don’t go after the ACTIVE Job SEEKERS
2. We Find the BEST people we can who can do your job!
3. We vet them for Competency, Character and Chemistry with your company and the job they must do.
4. We present a short list of qualified prospects.
5. We REVEAL their blemishes and flaws, after all, it isn’t a race to get paid.
6. We Don’t fill your inbox with RESUMES.
We do the screening and vetting for you.
7. By their first interview, you will know more about them than most hirers know after their first interview.
Many of our clients schedule FACE to FACE interviews as the first interview.
There is a high level of confidence that we deliver!