Pros and cons of using an executive search firm

Your company has some opening jobs that are hard to find suitable candidates? Have you ever considered using an executive search firm? Do you know about this recruiting method? Let’s see what pros and cons it can bring.


 

What is executive search?

Executive search (also known as headhunting) is a recruitment service that companies pay to find high-qualified candidates for senior-level and executive positions (such as ‘C-suits’, general director,...) and other highly specialized and skilled jobs (such as information tecnology staff, data analyst...). To use this service, companies must work with a third party, typically an executive search firm (or headhunter). But sometimes, it can be a recruiting consultant.

How an executive search firm works

An executive search firm is a type of service firm that provides executive search. An executive search firm’ work is usually seeking candidates, sending candidates’ profiles selectively to clients and conducting interview. But they may also be responsible negocitating salary and benefits, preparing offer letter and empoyment contract if needed. Sometimes, companies work with excutive search firms to fill lower-level positions because there are few candidates applying for those jobs.

Executive search professionals usually have a wide range of personal contacts and knowledge of the industry. Companies and executive search firms typically have long-lasting relationships because of the demand for candidates will never last. Everything has advantages and disadvantages. And using an executive search firms is not an exception.

See also >>> Executive search and Recruitment in Vietnam

Pros of using an executive search firm

Using an executive search firm can bring some advantages. You can look at these advantages to decide if this recruiting method can benefit your company.

1. It takes less time

Recruiting is their work. They continuously seek candidates, screen candidates and present these candidates to their clients. Therefore, they have a candidate pool from which they can pick up the right talents.

When an executive search firm receives an order from their client, they likely already have candidates qualified for a job opening. In addition, the time you need to spend on preparing a recruitment campaign can be reduced. So, this method tends to take less time than it takes for a company to fill on its own. And you may be aware of the importance of time. In business, time is money.

2. They offer guarantee on the candidate

One of the most significant advantages of using an executive search firm is the guarantee period of 30 to 90 days after a new employee is hired. If the candidate quits work for personal reasons, the firm will refund the recruiting fees or locating a new candidate. Thus, if the recruitment fails, you can take your money back or get a new employee to fill that position. It is up to you.

3. They provide high-quality search

You cannot ignore the quality of candidates that executive search firms provide. They have a talent pool. They can access a large network of contacts. They understand the company’s culture and need. They are familiar with recruitment process. They can reduce selection bias. And they have knowledge of employment laws. They know how to successfully approach the best candidates. Do you know that some talents will only work with a third party agency? They only appreciate the representation of an executive search firm.

Using an executive search firm is an investment that helps your company improve the quality of employees.

Cons of using an executive search firm

But executive search also brings some disadvantages. Some of these disadvantages can prevent some companies from using this method.

1. It costs money

The biggest disadvantage of using executive search firms is that they are not cheap. Fees are based on percentage of salary, usually 15% - 30% of first year salary. So if you order them for a high-level position, the fees can be significantly high.

In some case, administrative expense can be added to the total cost. And you have to pay more. However, if you hire a wrong person, the cost can be more significant. Remember this: you pay for what you get.

2. It is hard to find a good fit

You go to an executive search firm in order to find suitable candidates. Therefore, a wrong firm can lead to wrong candidates.

You need a firm that understands your company’s industry, culture and demand. This is not easy. Finding the right executive search firm can be as hard as finding the right candidates. However, once you find the right one, your relationship can be long-lasting and they can provide you with recruiting service several times later on. The longer you two work together, the better you two understand each other.  

3. You cannot control everything

In traditional recuitment, you participate in the whole recuitment process: posting jobs opening, finding candidates, selecting candidates’ profiles, conducting interviews, evaluating candidates, preparing offer letter and empoyment contract,... However, in executive search, executive search professionals work on your behalf and you cannot control some stages. It is important to ensure they are representing you and working for your benefits.

When do you choose an executive search firm over a traditional recruiter?

The method you use depends on the type of position you need to fill. If you want to find cadidates for high-level, executive, or skilled positions, you may want to consider using executive search. Although using an executive search firm cost higher than a traditional recruiter, you will get what you want.

Most companies decide to use executive search firm because they do not have internal network and resources or may be because their human resource departments cannot recruit exact candidates to fill opening positions.

If you want to use executive search firm, it is better to find an agency that has experience locating candidates in jobs that are similar to your open jobs.

See also >>> Executive Search & Selection Services of HRchannels Group

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