When you have a recruitment need, you have probably already decided whether to retain one firm or work with a handful of firms on a contingency basis. Why? If you have a relationship with a recruiter who has been consistently successful, you’ll be confident to retain them. But if you were disappointed last time you recruited, you will be knocking on other doors to see who else is out there. Last year we started relationships with tens of new clients, many of whom had been disappointed with their previous providers who were not delivering at the speed and quality required.

We understand why this has happened. In 2009 PER had twice as many candidates for half the searches as compared to 2007. In this market, employers work hard to retain their star employees and the number of jobseekers is exceptionally high. So sorting through the talent pool to identify the best potential investors for private equity and venture capital needed muscle and expertise. PER interviewed a record 2,200 candidates exclusively for private equity roles. About 1,000 of which were investment bankers, 850 were private equity professionals and 290 were strategy consultants. With this kind of candidate volumes in the market, you might conclude that finding great candidates should be an easy task. Finding stars is never easy – but by having the capacity to deal with that volume we were able to sift and screen for the best.

When to retain?

When choosing your recruitment strategy, think about the following:  

Only retain when you have the certainty that your recruiter has exhaustive market coverage. Think of the size of the candidate pool and ask your recruiter:

·     What percentage of the suitable candidates do they already know?

And

·     How many they can interview within a two month period?

Not many firms have the muscle to interview hundreds of banking candidates for a search. If you use a firm which does not have the capacity to cover the market you risk only tapping into a fraction of the candidate pool.  So you may well feel the need to use more than one recruiter on a contingency basis.

Contingency recruitment works well for roles where no one recruiter can give 100% market coverage, such as Analyst and Associate roles. You only pay the firm that makes the placement. The pitfall of contingency is that the process can get messy. Some of the same candidates talk to different recruiters and in some cases end in a fee dispute. Also, the need for speed means that a significant portion of the market will become aware that you are hiring. You will be flooded with interest by other recruiters and candidates approaching you directly, the confidentiality of your recruitment process might be compromised and the administration will become a headache. If you are going to use a number of contingency firms then follow a few simple rules.

·     Set a deadline

·     Ask for their five best candidates.

The main benefits of a retained search or working exclusively with a recruiter are that you will save time, have your recruiter do the legwork and most importantly your chances of success are significantly increased.  It is in the recruiter’s interest to keep you happy and look after you, when they work on a success only basis then you are a much lower priority.  When you retain you can have peace of mind that you are not missing anyone because they are keeping you informed about their pre-screening and coverage of the candidate pool. Also, you don’t pay a penny more than in contingency and have the guarantee that significant resources are being committed to speed and success. The risk for a retained search is that you limit your market coverage. It can be a lengthy process sometimes and if you discover you have selected the wrong firm to do the search, you have already sunk the costs of the retainer which is not refundable. 

So PER recommends the following approach:

1) Use contingency recruitment with a maximum of two experienced recruiters for entry level roles where the candidate pool is in excess of 500 people (ie. roles where you need bankers or consultants with easy-to-find language or industry skills).

2) Use retained search for entry level roles where there is a requirement which limits the candidate pool to under 50 people. You need one firm to have the disciplined approach to guarantee you did not miss anyone.

3) Use retained search for experienced professionals where you benefit from getting thorough screening, reports and references.

If you want to find out more or need advice on how best to approach your recruitment needs, please contact me on 020 7747 7885.