A cat has nine lives – what about recruitment companies?

  • Reading time:5 mins read

It’s amazing what some recruitment companies get away with. What I also find amazing is how naive some clients are. Naive because they believe they can get the same amount of work done on their assignment when they pay less to the recruitment company than to the executive search firm.

I say keep dreaming. It’s like in any other business; you get what you pay for.3483_Chain_padlock_color_web

This article is first and foremost to companies who are using recruitment services or executive search firms to help find and recruit candidates. But even you may be a candidate, please continue reading, this story will reveal the different methods used by the recruitment industry. You owe yourself to know who you deal with.

Here’s how I calculated the “less money” which I mentioned above. Take a compensation of 100,000 Baht per month. If you use an executive search firm with a fee of, say 32%, the invoice will be 416,000 Baht. If the recruitment company is charging you 20%, you pay a fee of 260,000 Baht when you employ their candidate. The difference between the two fees, and the 32 to the 20, is 33 percentage points.

5951_11 film reel silver_lavenderHere’s what you get for your money. The 20% fee:

  • You get a recruiter who quickly works through their candidate data base to find whatever comes close to your required profile. They need to work fast, because only if their candidate is hired by you, will they be able to send you an invoice. They know that you have most likely also contacted another recruitment company, thinking that the second recruiter has completely different candidates in their data base than the first one (which is actually not the case; you see, most active candidates send their resumes to many recruitment companies, thereby greatly overlapping the various data bases).
  • The hit and run methodology means the recruiter will use a few days on the data base or the internet job boards, then throw their spaghetti (read: candidate resumes) on the wall and hope that one sticks.
  • The problem is when no candidates are presented to you within the first week or two. Here’s the secret. The recruiter has in fact already moved on to the next caller in the hope of making a quick sale. It’s the nature of the business when you are paid on successful placements only. The attention span is short. If you have no resumes on your table shortly after you placed the order, be worried because no one is working on your job any longer.

More importantly, what do you get for your money paying 32%:olympic_medal_ribbon_original

  • The headhunter is not in a hurry per se. Executive search firms will appoint a consultant and a researcher to work as a team over many weeks or months. They will have spend considerable time in getting to you know your needs and your corporate culture. They will have analysed what are the key competencies, they will have drafted the chart for your approval, prepared a recruitment plan including the targettted firms where they will go hunting. For them it’s not providing a quick fix but a thorough planned approach to ensure that you get exactly the right person.
  • Executive search firms work on exclusive basis and will not take your order unless you commit to them 100%. During the search process they will contact hundreds of candidates to present your company, the job opportunities, and your employee value proposition. They will be hunting passive candidates and not those who are actively looking for a new job because they hate what they are doing or are between jobs.
  • The headhunters will use a script when they call up. They will use a tested best practice approach that will get passive candidates to listen, to think and confirm their interest in moving forward. From the first contact and through to the face-to-face interview, it is all following a well executed path.
  • Real executive search firms do not use internet job boards or printed media advertising. Only active candidates who are job hunting will be looking there anyway. All the passive candidates, who are not looking for job, will not open the job boards or the job classified. So you will only reach these people by calling them (according to US Bureau of Labor Statistics 16% of employees are actively looking; leaving 84% un-reachable).8448_Pot of Gold_coins_web

It’s my prediction that if recruitment companies only provide and sell data base resumes, and no other value added service, they will quickly use up their nine lives. Curiosity killed the cat, right?

Tom Sorensen

Tom Sorensen is an executive search veteran with over 25 years of experience recruiting in Asia, Europe, and Africa. He has worked in executive search in Thailand since 2003 and is recognized as one of the country’s top recruiters and most profiled headhunters.