Traditional Headhunters – highly specialized single searches with bases from $150K-$800K (SVP, CEO)
Executive/Retained Search Firms – niche/specialist single searches with high base salaries ($100K-$200K approx)
Contingent/Agency/In House/HR – sub $100K base salary searches one or multiple positions (manager & below).
Two lines in and I’ve already ruffled a few wing tips. Especially those in the recruitment field scanning this. In 2019 with all the resume databases, in house recruitment processes, agencies, applicant tracking systems and job fairs (etc) that corporations run, it’s strange to me that fewer and fewer qualified candidates are being unearthed per search. Now this isn’t always the case and some processes work well. But not many. In my experience there is a major gap to be bridged when it comes to the understanding of the key differences between hiring an agency recruiter and engaging a specialized headhunter.
Still think Agencies and Headhunters are the same?
Why would you hire someone to find you a CEO if they’ve never been one? Bold question. Would you ever take parenting advice from someone that doesn’t have children? I hope you answered NO here. Over the last nearly two decades in this industry throughout the Cities I’ve built businesses and lived in; London, USA, Canada, New Zealand, there are LOTS of people ‘in recruitment’ but in every City, less than a third I would consider of excellent practice. I’ve also found this on the higher end with Executive Search and Retained Search Firms. I wanted to outline things from my experience in the hope of saving you time/energy and dollars with your next hire.
Recruiters (Contingent, In House/HR)
- Have higher volumes of searches per consultant. Most contingent recruiters (agency based) work on 4-9 searches per month at any one time and fill 3-5 on average.
- Work on roles with salaries $50K-$90K.
- Take on a wide variety of roles and sometimes go outside their industry to meet quotas.
- Can take on big volume hiring projects using national delivery and enterprise systems (larger agency)
- Can be specialized for industries.
- Have big candidate pools and larger networks than executive search firms/headhunters traditionally.
- Often (but not exclusively) fill larger numbers of contract or temporary roles than permanent. *This is not all contingent recruitment operations.
Executive Search Firms (Retained Search Firms, Executive Search Firms)
- Low volume 1-4 per consultant on average.
- Generally work on roles with salaries $90K-$200K. **NB. This is where traditional headhunters generally separate themselves. They deal with roles that base from $150K to $800K with circa packages up to $2M (see below).
- Generally stay specific to industry i.e Banking and Finance, Technology, Engineering etc.
- Don’t take on big volume hiring projects.
- Relatively specialized and rarely go outside their niche. It’s the difference between a Personal Trainer and a Tennis Coach. A personal trainer is trained and qualified to instruct across multiple areas of fitness whereas a Tennis Coach is narrowed to his one sport. Both are needed in their assigned fields.
- Generally have industry specific network bases.
- Most often focus on permanent roles.
Headhunters (Specialist/Niche Market/Traditional)
- Typically 1 or 2 searches per month.
- Highly Specialized e.g. CEO searches for Non-Profits.
- High comp. packages (up to $2M) and base salaries $150K-$800K.
- Pretty much exclusively C Suite engagements (leaders of departments and organizations)
- Strictly permanent searches.
Whilst this is a general, non legalistic, look at some of the key differences between ‘Agencies/Contingent Recruiters/In House Teams’, ‘Executive/Retained Search Firms’ and ‘Traditional Headhunters’, I have found it reported from our clients that it’s often helped them in determining who to engage for their next hiring project. As a result, I wanted to put something together for the masses as we head into a very exciting 5 years of growth and change.
When to use: In House Recruitment & Contingent Recruitment ‘Agencies’
- One permanent role with base salaries around 50K-90K (approx)
- Multiple permanent roles in the same salary bracket
- Temporary roles (one days admin cover all the way up to a years long term sickness)
- National scale hiring projects eg. RFP’s with high volumes of hires needed
When to use: Executive Search and Retained Search Firms
- Single search assignments with base salaries from 90K-200K(approx)
- Leadership positions that span most common C Suite positions (Director/VP)
- Industry specific positions that run into the specialized skillsets
- President/CEO searches on occasion, depending on the firm
When to use: Traditional Headhunters
- High level C Suite appointments with bases $150K to $800K
- Leaders of organizations (SVP’s/Presidents/CEO’s)
- Highly specialized C Suite roles