formally known as “Executive Search” is a specialized recruitment service used to source candidates for senior, executive or other highly specialized positions in organizations. The method usually involves commissioning a third-party organization, typically an executive search firm but possibly a standalone consultant, to research the availability of suitable candidates working for competitors or related businesses. Having identified possible recruits that match the client’s requirements, the executive search firm may act as an intermediary to investigate whether the individual might be interested in moving to a new employer and also carry out initial screening of the candidate, negotiations on remuneration, and the employment contract.
The contractual relationship between client and executive search firm falls into two broad categories: contingent and retained. Contingent recruiters are paid only upon the successful completion of the “search assignment.” Retained recruiters are paid for the process, typically earning a recruiting fee in three stages based on the anticipated compensation of the executive.
- Retained search
Since they act as management consultants working in the best interests of the clients for whom they conduct searches, it would be counterproductive to simultaneously remove talented executives from those client companies. Search firms may decline assignments from certain companies, in order to preserve their ability to recruit candidates from those companies. Some large search firms may insist on guarantees of a certain number or dollar value of searches before they will put an entire company “off-limits”.
- Delimited or engaged search
While both retained and delimited/engaged searches serve client employers rather than job-seeking executives, delimited/engaged search contracts always (as opposed to sometimes) state a future date when the project must be completed or the downpayment refunded.
- Contingent search
As stated, contingent search firms are remunerated only upon the successful completion of the search—typically when the candidate accepts the position.