How Executive Search Differs From Traditional Recruiting - Executive Search Firm

      How Executive Search Differs From Traditional Recruiting

      When it’s time for a major leadership transition, your organization needs more than a standard recruiting firm. Instead, you need an executive search firm to aid your quest for the next C-level executive. 

      How does an executive search firm differ from a standard recruiting and staffing service? Learn more about the role that executive search firms play in the succession planning process and how this sets them apart from staffing agencies.

      What Executive Search Firms Do

      What Is Executive Search?

      Executive search represents the pinnacle of talent acquisition. While the term “headhunting” is falling out of fashion, the two terms refer to the process of selecting executives and top-tier specialists for a role within an organization. 

      While standard recruiting focuses simply on filling roles, an executive search focuses on finding dynamic leaders who can drive organizational success. 

      Specialization in Executive Recruitment

      Organizations rely on executive search consultants to fill executive leadership positions. This includes such roles as:

      • CEO, COO, CFO, CIO, CHRO, etc.
      • President, Executive Director, etc.
      • Senior Vice President, Vice President, etc.

      Thus, executive search firms commit themselves to finding candidates who match the technical skills needed to thrive in these environments, as well as the soft skills needed to lead and communicate effectively. Top-ranking executive search firms also work hard to ensure alignment between candidates and the organization seeking to fill these positions.

      Want Help Finding a Job? Contact an Executive Placement Firm


      Executive placement firms and an executive search firms both operate within the field of recruitment, particularly at the higher levels of corporate hierarchy, but they serve slightly different functions and purposes in the recruitment process.

      Here’s a breakdown of the key differences between executive search firms and executive placement companies.

      Purpose & Focus

      Executive Search Firm

      Focuses primarily on sourcing and recruiting candidates for senior-level and executive positions on behalf of client companies. These firms specialize in identifying, assessing, and recruiting top-tier talent, often for specialized or high-level positions that are not advertised publicly. They typically work on a retained basis, meaning they are hired by the client company for a specific search and are paid regardless of the outcome.

      Executive Placement Firm

      While also involved in placing candidates into jobs, these firms may have a broader scope including not just executive search but also placement services at various levels of an organization. They may assist candidates in finding suitable positions and work on behalf of the job seeker finding them a new job opportunity. Due to this relationship, placement firms operate on contingency, getting paid only when they successfully place a candidate.

      Methodology

      Executive Search Firm

      These firms often employ a proactive approach, conducting thorough market research, networking to identify potential candidates, and directly approaching passive candidates (those not actively looking for a new job). Their process is highly customized to the client company’s needs and involves deep assessments of candidates’ skills, experiences, and cultural fit.

      Executive Placement Firm

      Placement firms might also recruit actively, but they often work with a pool of candidates who are seeking new opportunities. They match these candidates with open positions within their network of companies. The process can be less about headhunting and more about matching available talent with the needs of businesses.

      Relationship with Clients

      Executive Search Firm

      Tends to have a closer, advisory relationship with their client companies, often involving consulting on the job description, compensation package, and market conditions. They are typically retained for their services, meaning they are paid a fee upfront and work exclusively for the client until the position is filled.

      Executive Placement Firm

      While they can also have strong relationships with hiring organizations, their model may be more transactional, especially if they work on a contingency basis. They may provide valuable services in sourcing and screening candidates, but the depth of the consulting aspect might vary and is job seeker-centric.

      Fees and Payment Structure

      Executive Search Firm

      Usually operates on a retained basis, receiving a portion of the fee upfront, another payment during the search, and the final payment upon successful placement. Their fees are often a percentage of the placed executive’s first-year total compensation.

      Executive Placement Firm

      More likely to work on a contingency basis, meaning they are paid only if they successfully place a candidate. Their fee is typically a percentage of the candidate’s starting salary but only becomes due upon successful placement.

      Both types of firms play crucial roles in the recruitment ecosystem, especially for senior-level positions and specialized roles, but the choice between them can depend on the specific needs, preferences, and circumstances of both employers and job seekers.

      The Demand for Executive Search

      Talent shortages impact every level of an organization — including its senior leaders. Some organizations rely on executive search to strategically fill critical positions within the company’s leadership structure. Others turn to executive search services to fill unexpected leadership gaps. 

      More critically, however, companies have come to rely on executive search firms to ensure proper alignment between the candidate and the company, minimizing the risk of bad hires. 

      Executive Search Process

      The Role of an Executive Recruiter

      An executive search demands an executive search specialist — also known as an executive recruiter. These recruiters apply in-depth knowledge to match leadership candidates with high-level roles that fit their skills, experience, and leadership style. 

      Key Differences Between Executive Search and Recruitment

      What truly separates an executive search from other recruitment and talent acquisition agencies? While both types of organizations aid businesses in hiring decisions, there are several key differences between the two strategies.

      Types of Roles

      The primary difference between executive search and other types of recruiting involves the nature of the role itself. Recruiting and staffing organizations focus on entry-level positions and mid-level management roles. Executive search focus exclusively on C-level executives and corporate leaders. 

      Industry Focus

      Retained Executive Search vs. Contingent Recruiting Firms

      It’s not uncommon for recruiting agencies to focus on only one or two industries. For example, some recruiters offer placement services to individuals in the tech sector, while others focus on finance. Executive search teams work across multiple industries, focusing on the candidate’s technical skills as well as their core leadership qualities.

      Active vs. Passive Recruitment

      Typically, recruiting agencies don’t spring into action until a candidate submits an application. While some recruiters are adopting a more active approach through recruitment marketing, they’re still primarily focused on the currently unemployed. 

      Executive recruiters operate differently. An executive search firm will engage in passive recruitment, meaning they target leaders who are not currently seeking a career change. Executive recruiters therefore work to bring potential candidates into the recruiting funnel to engage them with a new opportunity.

      Emphasis on Alignment

      Recruiting agencies primarily focus on results. They measure success by filling available positions and matching candidates based on skill set. 

      Executive recruiters also examine a candidate’s technical skills, but that’s only part of the basis for hiring. Executive search teams also examine the candidate’s soft skills (communication, leadership, etc.) and ensure that they align with the company culture.

      Contingent vs Retained Executive Search Firm Fees

      Contingent vs. Retained

      Another key difference lies in the pricing model of executive vs. traditional search firms. Search firms can either be contingent or retained. Contingent means that the firm only receives compensation when a candidate is hired. Retained means that a client company pays an upfront fee and then pays the rest once the candidate is hired. 

      While executive search firms can be either contingent or retained, the top executive search firms are all retained. Traditional recruiters, on the other hand, are all contingent. 

      How to Hire an Executive Search Firm

      When you’re ready to onboard a new executive, turn to a group of specialists who can make the transition a smooth one. You can optimize the process by preparing in advance to work with an executive search team. Here are some tips to get you started.

      Set Clear Goals

      Start by defining your objectives. What do you want the search firm to accomplish? You should identify the technical skills associated with a leadership position and also express the kinds of traits that would make that individual successful within your company culture.

      Count the Cost

      When searching for an executive search firm, make sure that you understand the cost structure. Retained firms will charge an upfront fee, so learn what this fee is and how the firm starts the process after receiving payment.

      Cost of Failed Executive Recruitment Efforts

      Set Communication Expectations

      Ideally, you want an executive search firm that provides total transparency throughout the process. When screening potential firms, make sure to ask how often the firm communicates with clients. This will ensure that you have total visibility over every step of the search and hiring process.

      Review the Track Record

      Some of the best executive search firms will offer examples of past search engagements. Consider whether a particular firm has experience working with companies of comparable size and in the same industry. Review past searches and case studies to get a better feel for the process and what you can expect from the firm.

      The Right Candidates, the Right Firm

      As you can see, executive firms differ from traditional staffing agencies in the scope and methodology they use to fill upper-level leadership positions. Organizations can rely on these specialized firms to provide a higher standard of service and help connect them to the right leadership candidates. 

      After all, top leaders will play a role in shaping both the workplace environment and company success for years to come. That’s all the more reason to partner with a professional firm with the experience and expertise to fill these top roles.

      Get Lightning-Fast Placement of Elite Talent from a Top Executive Search Firm

      At Cowen Partners, we stand at the forefront of the executive search industry, empowering companies to thrive and excel in their growth, revenue, and market presence. We specialize in identifying exceptional leaders and placing them in key positions to drive success.

      Our team of seasoned executive recruiters collaborates with organizations of all sizes, encompassing both public and private enterprises, pre-IPO ventures, and non-profit entities. Through a meticulous and discerning approach, we unite handpicked candidates, with companies in pursuit of the most exceptional executive talent, representing the top 1%. With the support of our experienced senior partners, we execute a diligent and efficient executive search process, ensuring leadership placements within a remarkable six-week timeframe.

      Executive search placements span the entire C-suiteCEOsCFOsCOOsCMOsCIO/ CTOsCHROsCLOs, and leadership roles including VPs, Directors, and more.

      As experts in the nuances of executive recruitment, Cowen Partners continues to be a leading C-suite search partner nationwide. We are also a premier resource for the latest insights on the hottest executive search trends and topics, including (but not limited to) those below.

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