Executive Search vs Recruitment Agencies
Oct 02, 2018
The UK job market is at a critical juncture at the present. Shortage of skilled workers has reached 'critical levels', according to a research report by the British Chambers of Commerce (BCC).
Nearly 71 percent of service sector businesses are finding it hard to find the right workers for the job. Moreover, around three-quarters of manufacturing firms had reported trouble in finding the right candidates for the posts.
In this context, the services of executive search and recruitment agencies become invaluable. These firms take away the administrative burden, time, and effort involved in finding the right candidates for the job.
A lot of people think that executive search and recruitment agencies perform the same services. While both the firms help companies help locate top talent, there are certain differences between the two. Here you will find out a brief overview and then the main differences between these two types of agencies.
Executive Search Companies:What do they do?
Executive search companies search, vet, and introduce highly qualified candidates to companies. They generally seek out candidates for senior, executive, and other highly specialised positions. The firms choose from a pool of candidates that best meet the client firm's needs.
Also known as headhunting firms, executive search companies are a third-party agency acting as an intermediary between the candidate and the company. They may carry out screenings, hold negotiations, and encourage the candidate to accept the job role. However, they don't do any hiring on their own.
Recruiting Agencies: An Overview
Recruiting agencies also help find and match candidates for a given post similar to executive search companies in the UK. They work with companies directly to fill open positions within a company. Their services include pre-screening candidates and facilitating the interview process. They are also a third-party agency with no association with any company.
Executive search and recruiting agencies may appear to offer similar services. However, there are certain points of differences that you should know. Understanding the differences will help you in selecting the right firm for filling job vacancies.
1. Job Hunting Role
Recruiting agencies generally play a less proactive role in seeking out candidates. The job openings are posted online to social media sites such as LinkedIn or Facebook, job portals, or newspapers and magazines. They allow candidates to reach out to them by posting job openings.
In contrast, executive search companies play an active role in finding talented professionals. They directly contact prospects that are the best fit for the role. The companies often work with the HR department to know about the exact needs. Most commonly, executive search companies work to fill specialised job roles that can't be filled using traditional recruiting techniques.
2. Process of Matching Candidates
The process of finding and matching candidates is different for executive search and recruiting agencies. Generally, recruiting firms adopt a reactive or passive search strategy. They advertise a position, collect CVs in bulk, and then contact active job seekers.
On the other hand, headhunting firms adopt a more active approach to filling job positions. They apply a more methodical and systematic approach to finding the right candidates. The process of finding prospective employees typically includes a complex market mapping exercise in order to create a list of candidates. The shortlisted candidates are further reviewed and then one or two are selected that best meet the organisation's criteria. The exact process of finding suitable candidates differ slightly but the result is the same — a selection of top talented highly qualified individuals for given positions.
3. Type of Candidates
Another important difference between executive search and recruitment agencies is the type of candidates they prospect.
Recruitment agencies generally prospect active candidates. But who are active candidates? They are prospects with a prepared CV who want to switch positions. The individuals are generally de-motivated in the current position. Recruitment agencies attract such type of candidates through their passive recruitment strategies.
Executive search companies, on the other hand, seek passive candidates. Contrary to active candidates, they aren't looking for a job move. An executive search company targets these candidates and tries to convince them about accepting an attractive employment offer.
So, is there any advantage in seeking passive over active candidates?
Seeking passive candidates is an exercise of selecting the brightest star in the workplace. Candidates who are satisfied with their positions are implied to have the capability, work ethic, and characteristics that make them perfect for a given job role. They are more likely to be successful when they transition to a new workplace. Seeking passive candidates is a significantly less risky proposition compared to active candidates.
Recruiting passive candidates is ideal if you want to hire stars with a positive track record who can make a big impact on the business bottom line. Passive candidates will more likely align with the job roles and requirements. Instead of settling for a 'close enough' match, you can go for a 'perfect' match when you go for passive candidates. And this is possible through hiring the services of executive search companies who will endeavour to sell them the role instead of offering them.
4. Working on Local vs. Global Mandates
Recruitment firms generally work on recruiting local candidates. They seek employees who are located near to the place where the client's office is located.
In contrast, executive search companies can carry out global searchers of executives including C-level professionals. The services prove invaluable for global multinational companies that want to hire a candidate with international exposure. The company will carry out salary negotiations and persuade the executive to accept the job offer. This is something that the recruitment agency is not able to do due to their business model in hiring candidates.
5. Job Roles
Recruitment agencies generally seek candidates with a board skill set for fling different positions. The agencies are generalist offering services to fill any position within the firm. They look for candidates with the following job profile.
- Non-executive positions
- Jobs requiring less specialised skills
- Jobs that don't require any specialisation
- Candidates with multiple skills matching different roles
On the other hand, executive search firms seek candidates with a specific skillset. They generally seek individuals with highly specialised skills. The firms are specialists who focus on finding individuals with the following job profile.
- Technical skills
- Executive level positions
- Hard-to-find positions
- Business critical positions
The fact that executive search firms specialise in hard-to-fill positions makes them highly valuable to companies. They apply a unique approach to finding A playertop candidates quickly for the clients. The firms help companies to fill a small number of highly specialised positions in quick time.
Executive search firms will persuade the candidate to accept the position. However, the firms will only make an effort if the offer is a genuine career enhancing opportunity. The firm will never shoehorn a candidate to earn a commission.
6. Quantity Vs. Quality
As you must have now deduced, recruiting firms to focus on quantity while executive search firms focus on quality. This is another characteristic that distinguishes recruiting firms from executive search firms.
Recruiting agencies try to fill a large number of posts. They spend a relatively small amount of time in scrutinising each application. The aim is to find 'good enough' candidates for different positions.
In contrast, executive search companies focus on filling a specific position by hiring the best person for the job. They meticulously inspect each candidate to ensure the best fit for a position. The companies generally engage in a detailed discussion with the client to ensure all the requirements are known. This means these companies fill positions with candidates that are most qualified for the post.
7. Required Discussion
As a hiring manager or CEO, you don't need to carry on detailed, lengthy discussions with recruiting agencies to fill positions. This is because a recruitment firm often helps you select less impactful positions. The agency only requirea job description that will be used to fill the position.
In contrast, you need to work actively with an executive firm. The firm will want to discuss with you in detail the job requirements for the position. Be prepared to discuss the importance of the position, the required performance levels, work environment, and key selling points to convince candidates to work for your company. Without discussing these important points, the executive search firm won't be able to locate the best talent that meets your exact requirements.
8. Extent of Relationship
Recruiting agencies typically don’t form a long-term relationship with employers. They work on a role-by-role basis. They don't need to form an enduring relationship with the clients. A firm has flexibility in selecting a recruitment agency since the jobs for which candidates are not specialised. The firm can rely on an in-house HR department to meet recruitment needs.
On the other hand, firms endeavour to form an enduring relationship with an executive search company. The reason is that their services are highly specialised. Not every firm is able to seek highly qualified and skilled individuals that best meet the job requirements in quick time. Only a firm with decades of experience in hiring highly qualified executives can better perform this type of services.
Which is Better: An Executive Search or a Recruitment Firm?
Firms typically hire executive search companies for senior level posts such as directors or C-level executives. Their services are sought after when it's difficult to locate and persuade top talents to make a move. In addition, the services of executive search firms prove invaluable when hiring the candidate will have a big impact on the success or failure of a project.
Generally, the services of recruiting agencies are used for non-executive positions. The firms typically focus on quantity rather than quality. Due to unspecialised nature of positions, they often shuffle candidates who aren't selected for one position to apply for another.
You can afford to take risks when the position to be filled will not directly impact the business bottom-line. Also, if there is no shortage of skills, you can afford to hire any qualified candidate for a given position. But if there is a critical skill shortage or the required position have a direct impact on the business efficiency and profitability, you should better select a company that can increase the odds of selecting top talented candidates.
For junior and non-executive roles, recruiting agencies may be the right choice. The recruiting firms generally have a broader reach to candidates. They are able to provide you with a large list of potential candidates for the job. But this alsocreates difficulty in selecting the best candidates for a position. The hiring manager may have to apply due diligence to select qualified candidates for the post from among a pool of prospective employees.
On the other hand, if you want to fill an important executive position, executive search agencies if the right choice. The firms offer a restricted but highly talented pool of employees. There is less risk of selected the wrong candidate for a given role when you hire an executive search company. In case you need a candidate with a particular cultural fit, exact skill set, or stellar performance history, an executive search company is your best choice.
Whatever you decide, you should make sure that you understand the differences between the two before selecting one to hire new candidates. You should know about the procedure and the fees before signing any contracts.
Jefferson Maguire is a specialist executive search and headhunting company in the UK. We apply a unique approach to finding qualified individuals for organisations. Our executive search and head-hunters are trained to the very high standards. They can find an A playertop candidates in 20 days through precise targeting. Using our executive search services take away the risks involved in hiring new employees. For more information about our headhunting services, you can contact us today.
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