“RETAINED! RETAINED! RETAINED!”
If any of the big Recruitment personalities of LinkedIn posted the above, they’d have “likes’ into the thousands and comments into the hundreds. Now of course, those commenting would be that unique breed of recruitment sycophant who always comment with “Nail. On. Head. As per usual Greg. Let’s grab a coffee?”, but this doesn’t detract from the fact that Recruitment leaders like to talk about retained recruitment almost as much as Recruiters seem to avoid working on a retained basis. Before I begin on this week’s rant however, just a quick explanation to those non-recruiters who accidentally clicked this link thinking it’s about cosmetic dentistry: Retained recruitment is where the recruiter takes a portion of the fee up front to commence the search, and is typically the only recruiter working the role. Typically, it is anticipated that the client is presented with a shortlist of candidates with corresponding interview notes. Contingent recruitment is where a recruiter is paid the full amount once they find someone, and they’re not always the only recruiter trying to fill the role. Typically, it is anticipated that Recruiters shonk a load of old and inappropriate CVs to a client in the hope of getting lucky Got it? According to almost everyone, one is good, one is bad.
The lack of retained work being won by recruiters is often seen as a training issue. Junior recruiters don’t have the skill or confidence to sell the value of their client parting with some cash before the recruiter has even returned to the office. Especially when there’s another recruiter waiting in the hallway who may happily work on a contingent basis. To a client who hasn’t had the full explanation and education on the realities of recruitment, the “no win, no fee” contingent model seems much less risky. And if this is the path of least resistance, it is understandable that an under-trained recruiter would take this path. However, I reckon there’s some other issues at play here (of course I do – otherwise this blog is over), so hear me out.
Taking some money up front to fill a role makes sense for the recruiter and the client. The client gets dedicated time from the recruiter who will prioritise this role over other contingent assignments. The recruiter is more likely to adopt a search methodology (because they’re being paid to work) versus just a shitty job ad and a quick search of a database. The recruiter has also made a commitment to work until the role is filled, which ultimately is what we’re all trying to achieve. In turn, the recruiter gets a guarantee of exclusivity, and is paid to actually run a process which covers both the passive and active candidate market. However, it’s not all shits and giggles.
Firstly, a lot of people who are trying to encourage recruiters to sell retainers are no longer running a desk. They may be running businesses. They may be coaching recruiters. They may be one of the many hangers-on trying to squeeze a buck out of the industry, but many aren’t recruiting middle-managers for boring companies. Those GMs who are still billing are typically recruiting at GM level because, well…because that’s just the way the world is. However, when these leaders, coaches, and “experts” were running a desk, the world was an ever-so-slightly different place. Summers went on forever, the birdsong only punctuated by the sound of leather on willow, you could leave your front door unlocked, and there was no LinkedIn or job boards and people didn’t have commitment issues. The old school London model of a third up front, a third on “shortlist”, and a third on offer was a viable fee structure. However, in the present day, in a market with, let’s face it, fuck-all candidates, too many recruitment firms, and too many tempting vacancies, the idea that any of your “shortlist” will be available come offer stage is pretty damn slim. Retainers can still be sold in this market, but not like your Granddaddy sold ’em. The market moves so quickly that recruitment often has to be opportunistic. If you see someone you like, hire them and screw the process.
Secondly, I’m not convinced that the traditional retained model sits comfortably with the psyche of millennials as they enter the recruitment industry. Even without “full search”, retained recruitment is a process. One that requires discipline. I started my career in exec search , and the role of a Researcher in the mid-2000s was, in the most part, quite boring. It was manually gathering names, and turning over every stone in the hope of finding someone relevant. We didn’t make many placements a year, and the presentation of the report to the client was very important. It was a job for nerds and prematurely middle-aged pompous private school boys. I’m not sure if running a very thorough process is as alluring today as it once was. People are a bit more casual, process is less in vogue, and gratification can’t seem to wait as long these days.
Thirdly, retained recruitment does not necessarily make for an easier life. In fact, I know of several recruiters who have been scared off retained recruitment for life following their first attempt. Getting paid some cash up front sounds brilliant, however, this also carries an expectation. Y’see, when a junior recruiter picks up some contingent work, this “I’ll keep an eye out for someone” is as pressure-free as recruitment can get. It’s how Americans “date”. Nothing is exclusive, there is no commitment, and we’re all looking for a Jewish Doctor. And if you can run a contingent desk and bill enough to keep your boss off your case and some bugle up your nose, then you have a charmed life. However, when you sell a retainer you are basically stating “Mr/Mrs/Miss/They Hiring Manager – I will fill this role come hell or high water”. And some recruiters don’t think this pressure is worth adding $5k to their billings a bit earlier, especially when the current lack of candidates erodes any confidence in filling any given role. Failing to fill a retainer is the recruitment version of purgatory.
Finally, like the logistical challenge of everyone arriving for a domestic flight exactly 2 hours early, working retained only works if not everyone is doing it. If we all started working retained, someone would re-invent contingent recruitment and bill loads of money, and a load of recruiters would revert back because of reasons 1,2, and 3.
That’s it from me today. Contrary to the above, I’m hopefully selling a retainer this morning, so wish me luck.