BYRON LEONARD
INTERNATIONAL, INC.


Executive Search Consultants

CONTINGENCY FIRMS VERSUS RETAINER FIRMS


Frequently asked questions about executive search often result from a lack of understanding of the two major types of practitioners in our industry. Here is a factual guide for your information.

CONTINGENCY FIRMS RETAINER FIRMS
1. Frequently represent individuals seeking placement. 1. Represent Companies employer only.
2. Are usually in competition with other similar firms or agencies for the placement. 2. Conduct search assignments on an exclusive contract basis only.
3. Professional staff is usually compensated on commission for placements made. 3. Professional staff is usually compensated on salary and bonus with incentives for client business development.
4. Usually search for lower level organizational positions including but not restricted to individual contributors. 4. Usually work at middle to senior management organizational levels.
5. Tend to spend little time on initial research and specification; often never meet company management or prospects. 5. Must know client organization and position responsibility/requirements thoroughly before initiating search. Typically document this in a position description.
6. Focus primarily on applicants/candidates actively seeking employment; recruiting is placement-oriented. 6. Recruiting efforts are strategically focused on a broadly targeted range of potential candidates, most of whom are not active in the job market; recruiting is process and result oriented.
7. Search consultant works concurrently with a multitude of open job orders. 7. Typically the search consultant is personally committed to 3-5 assignments at any given time and is responsible for the success or failure of each.
8. With no guarantee of payment for services performed, the consultant cannot afford to invest much time in a search beyond basic recruiting and submission of resumes. 8. Search consultant typically invests 40-160 hours per month per client assignment in recruiting, evaluation, screening and client interaction.
9. Will present most candidates within 1-2 weeks of obtaining job order; may submit substantial paperwork to increase probability of a placement by pushing for interviews and hoping for interest on both sides. 9. Usually recommends 3-10 highly qualified and ranked candidates to client company in 4-8 weeks.
10. Contingency search requires considerable Human Resource involvement in screening, interviewing and evaluating candidates presented. 10. Requires minimal Human Resources and General Management time investment until interview process begins.
11. Under no obligation to guarantee or produce results due to contingency fee arrangement (paid on placement only). 11. Reputable firms offer a professional guarantee of candidate success and are committed to thorough and ethical practices and results including an off limits policy.
12. Fees range from 15-33% of compensation and are paid by company on placement (or shortly there after). 12. Fees range from 25-33% of compensation (or flat quote) plus expenses and are paid by company in installments.
13. Decision to pay a fee is usually made by Human Resources and is budgetary motivated. 13. Authorization for search is usually made by company General Management and Human Resources Management with rigorous selection criteria.

COMPARING EXECUTIVE SEARCH FIRMS (adapted from ERN 11/85)


BYRON LEONARD INTERNATIONAL, INC.
Telephone: (805)373-7500 or Fax: (805)373-5531
99 Long Court Suite 201 - Thousand Oaks, CA 91360