1. The number one reason: Salary. Most companies use outside retained search firms for hires above $100,000. This shows the potential candidate that they are exclusive about the position and that it is mission critical, as well as important to the well-being of the company. The organization is perceived as a class act.
2. Your company needs a dedicated partner to fill the position within 30-60 days. Many contingency firms will spend just a few hours on your search looking for “low hanging fruit.” If they do not get a hit, they move on. Retained search firms, on the other hand, dedicate all their time to your search for the perfect candidate.
3. You are looking for a specific talent/skill set, or need the “proven” abilities of a market leader.
4. Your company wants an impartial 3rd party to conduct and screen candidates. Retained search firms find you the “best” candidates available not just the best that is readily available on the surface. Retained search companies use proven sourcing methods to uncover qualified candidates.
5. Confidentiality! If publicizing the open position jeopardizes the company or its market share to stockholders, you definitely want to move toward retained firms.
6. Your company would like to benchmark between your internal talent pool and outside candidates. In smaller companies, the successful ones tend to “look” like the CEO. Can a small company operate if everyone has the same skill set? By contrast, companies such as GE eliminate their bottom 1/3 of nonperforming employees yearly. This was the Jack Welch way.
7. Your company needs a professional who will understand your culture and other environmental nuances that may affect the candidate on the search.
8. Your company needs an outside 3rd party to contact, persuade and convince an executive to leave his/her existing position. It has long been considered unethical for a company to call their competitors and attempt to recruit their top employees to leave their employers.
9. Your company wants more than just a superficial search. Retained search firms go about 4 levels deep to uncover the best-qualified candidates.
10. Your company wants to make sure that the potential candidate will know that the position is critical to the success of your company and that they are looking for “the best of the best.” It also shows the candidate that the company obviously is growing and profitable enough to retain such services, creating a level of prestige.