The following is a guide for decision- makers at corporations, universities or large nonprofit organizations who are considering engaging a retained search firm to attract and recruit experienced executives for an important management position.

Retained executive search firms are retained by the client organizations and represent that client’s position exclusively. We seek out and attract the best candidates in the country who have achieved outstanding track records where they currently work. 

• Industry specialty (such as retail, energy) or professional function specialty (such as finance, public relations)
• Level of positions the firm typically manages (mid-level, senior-level)
• Average length of time to complete a search
• Percentage of searches completed
• Candidate performance guarantee
• Retained Firm vs. Contingency "Off-Limits" Restrictions – a reputable firm will never recruit away the candidate they placed with a client organization, and will not approach other individuals at that organization for one year or more after the conclusion of the last search conducted

• Do the executives and associates at the firm have career experience in the professional function for which the search is being conducted, as opposed to experience solely in recruiting?
• Who doesthe work? Are senior-level managing consultants involved throughout the search, or is the work done by junior associates?
• How many assignments is each search consultant currently managing?
• What is the firm’s diversity track record?
• What is the firm’s reference-checking process?
• What companies are on the firm’s off-limits list?

Acting as consultants to their client, a retained firm will become thoroughly acquainted with its client’s business, and will provide advice on the position’s specifications, title, compensation, reporting relationships, and more.  A retained search firm presents only a few, highly-qualified candidates who meet or exceed the work experience and skill requirements of the position, and fit the client organization’s culture and values.  Client organizations that use retained search firms save valuable time by seeing only well-qualified candidates who have been thoroughly screened.

The most significant difference in methodology between retained and
contingency search firms is how each approaches candidate recruitment. Retained search firms conduct original research and aggressive outreach to find the most qualified candidates for a position, and will work on a search for as long as it takes to find the right person.

Retained firms are considered to be more successful at proactively recruiting top executives who are satisfied in their current positions and must be attracted to another opportunity requiring very specific management experience and a proven track record.

Contingency firms represent candidates seeking work and primarily review their existing database to provide resumes of individuals who might be a match.  Contingency firms are often best utilized when an organization needs to make a hire on short notice and is content that most of the candidate presented will be active job seekers.

Retained search firms are paid a professional services fee, calculated as a percentage of the total first-year cash compensation for the position.  The retained fee is split into three increments and paid over the first three months while the search process is underway.

Contingency firms receive a percentage of first-year compensation, or a flat fee, but are paid only when the selected candidate is hired—contingent upon placement of a candidate. 

Retained search firms generally manage mid-to-senior-level positions, while contingency firms handle low-to-mid-level positions. Retained firms work on an exclusive contract basis with their client organizations, and represent that position exclusively.  Contingency firms may present a single candidate to multiple organizations, since their primary motivation is to receive a placement fee for that candidate.

Working on an exclusive contract basis with its client organization, a retained search firm commits to successful completion of the search no matter how long it make take to find the best executive for that specific position.  A retained firm will typically guarantee a candidate’s performance for one year—or replace that executive at no additional fee.  A contingency firm is under no obligation to complete the search nor to guarantee for longer than a few months.

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