This article describes my authentic view of the recruiting profession, the process involved, and its impact upon the affected parties. My intent is to clear up some of the mysteries that surround the industry. I have been in the recruiting business since 1979. (For more details about my background, read my biography.) Employers and candidates alike are sure to benefit from the following discussion…

As you may know, recruiters are often called "headhunters." The term probably originated 30 or 40 years ago amongst the most elite business executives: CEO's, CFO's, and other high-ranking Fortune 500 executives. The company "places the order;" the recruiter "fills the order." Armed with a client company’s specified requirements for a person they seek to fill a top executive job opening, a "headhunter" begins to hunt for and approach likely "candidates." The objective, of course, is to find the one person who will eventually be hired. The fact that a client company is putting in an order for (seemingly buying) a human being and his/her talents lends the search business an air of mystery; it has been known to be the subject of controversy, as well.

How does a recruiting firm get paid? Traditionally, the recruiting firm is paid a percentage (generally 30% or 33 1/3%) of the candidate's starting annual compensation, although there are variations. Such fees are most often paid on either a retainer or contingency basis; sometimes a combination plan is employed.

Under a retainer contract, the client company pays a specified sum of money "up front" (generally 1/3 of the estimated fee) and then pays the balance over the course of the search, usually making a final payment upon the hire of the successfully recruited candidate.

The recruiting firm must be very meticulous in developing a detailed and precise set of search specifications, a complete job description, and any other pertinent details. Even the personalities and individual quirks of all parties to be involved with the search are important.

Retainer contracts generally include provisions for all expenses the recruiter will accrue, such as research, administration, travel, and entertainment all of the activities accompanying a "headhunting" assignment. Retainer firms generally do not offer guarantees, nor are any fees they collect typically refundable, even if a search proves unsuccessful! Retained firms are usually hired by Fortune 500 companies to fill their top executive positions. Client companies wish potential recruits to be wined and dined by the headhunter in order to entice them. The perception is that the retained search firms are the tried-and-true experts at having this process work best.

Contingency firms generally charge a percentage (usually 20% to 30%) of the successful candidate's starting annual compensation. Generally, no fee is charged by a contingency firm until the hiring process is complete. When a placement occurs, the contingency firm bills the client for its fee, usually upon the candidate's starting date of employment. Contingency firms normally pay their own expenses. Many contingency firms strive to upgrade their portfolio of clients by attempting to land retainer business, since the search process is basically the same (detailed below) for both retained and contingency searches. However, contingency firms that secure retained searches are frequently disillusioned by the client demands that accompany the luxury of the up-front retainer money. Consequently, contingency firms tend to work on mid-to upper-management positions - Fortune 500 or otherwise - and get compensated when the placement is made.

In the course of searching for the person who will get the job, a recruiter may telephone hundreds of people and conduct numerous interviews before narrowing his/her focus down to a few of the most promising candidates. These 5 or 6 (or less) will go through some or all of the sometimes lengthy process with the recruiter. Carried to its conclusion, this scenario will yield one successful (and presumably overjoyed) candidate - and probably several disappointed candidates.

As a natural outgrowth of the continued rapid expansion of the search business, people interested in job changes will almost invariably request help from a headhunter to assist them in finding a position! Often these requests come from candidates who were "left over" from other searches (i.e., they weren't hired for a previous position{s} for which they were recruited). In such cases, I gently respond that headhunters don't find jobs for people - that what we do is search for the one person whom our client companies will ultimately hire for a specific job. EMPLOYMENT AGENCIES find jobs for people! There is an enormous gulf between the kinds of people of interest to employment agencies and the select relative few who become hired through headhunters – so truthfully, it is therefore up to most job-seekers to find their own jobs! This is not to say that a candidate cannot later become one of the "select few;" the questions are if and when that will happen - which are of course unanswerable…

When I have conversations to let such hopefuls know where I stand, however, I am very concerned with what's going on inside the head of that other human being. I am extremely sensitive to the fact that telling that person that I will "keep him or her in mind" is a weak way of contributing to "a world that works" for that person - especially if the person was a "finalist" who was not ultimately hired. I have therefore found myself giving free career counseling, rewriting resumes for people who have nothing to do with my fields of expertise, and generally offering free coaching to appreciative individuals.

Whether you are an employer, a candidate, or a potential candidate, chances are your career has intersected with a "headhunter." If so, perhaps you have wondered about what we really do with our time. The following steps illustrate what happens during the placement process. They are straightforward and somewhat oversimplified, but actually performing the service from beginning to end is difficult and sometimes complex. (Keep in mind that two major activities are not represented on the list: making hundreds and thousands of telephone calls; and waiting for people to return calls…this is the epitome of a "hurry up and wait" business!)

STEPS IN THE PLACEMENT PROCESS

1. Take a complete job assignment.

2. Make a recruiting plan.

3. Do a file and database search.

4. Assemble names of prospects to call.

5. Begin contacting potential candidates.

6. Develop profiles and interviews on candidates.

7. Present candidates to employers - verbally and/or with resumes.

8. Arrange for initial interviews.

9. Prepare candidates for first interviews.

10. Re-confirm interviews with candidates and employers.

11. Debrief candidates after interviews.

12. Debrief employers after interviews.

13. Arrange for second interviews.

14. Do reference checks if required.

15. Prepare candidates for second interviews.

16. Prepare employers for second interviews.

17. Negotiate and close placements.

18. Secure offers, acceptances and starting dates of employment.

19. Prepare candidates for resigning from current companies.

20. Debrief candidates after resigning.

21. Prepare and mail invoices.

22. Stay in touch with candidates.

23. Stay in touch with employers.

24. Collect the fees.

In conclusion, having outlined the basics of the executive search business, I wish to make crystal clear the priorities of the parties involved in the process:

The client company's priority is the fulfillment of the search - to find the one best person for the job - and to secure that person with the best financial arrangement possible. Hopefully, the company is also committed that the candidate realizes a financial "win" as well. Any activities or telephone calls which are not perceived by the person conducting the search for the company as going in that direction are relatively unimportant to that person. Although the company has its public image to maintain, if the process with any particular candidate (say it's Mr. Jones) breaks down for any reason, the "warm, fuzzy feelings" go away very fast and the search continues for the successful candidate. If there's no headhunter involved in the process, the company will probably stop communicating with Mr. Jones by telephone and/or e-mail - and Mr. Jones will later receive a rejection letter. If a headhunter is involved, Mr. Jones should receive a telephone call from the headhunter with the news of his rejection. The reason given, if any, and its truthfulness depend, of course, upon the ethics, professionalism, and tact of the headhunter.

The candidate's priority is the successful management of his/her career. In this day and age, even if a person is content with his/her current position, it is wise to have a current resume ready at all times, just in case a great opportunity presents itself. However, it is also wise for candidates not to get too emotionally excited about any one particular job interview that may surface; there are generally other candidates who may be chosen as the one. So, we advise candidates never to become too attached to any one new opportunity - until they are hired! We have seen many a candidate feel very rejected when ultimately he/she did not secure the position. Interestingly enough, hiring authorities at our client firms become equally rejected when the one they are after for the position ends up turning THEM down!

Obviously, candidates are very interested in securing the right financial arrangements in moving to a new company. We find that knowledgeable candidates who are reasonable with their expectations are ultimately the most successful candidates. Whether a candidate decides to be realistic with his/her next potential employer is that person's decision. Here we are reminded of that old Wall Street adage: "Bulls make money; bears make money; PIGS STARVE!" We are amazed at how often candidates believe - and say (in so many words) that they are "leaving money on the table," i.e., that the offer is not high enough. While we advise candidates not to accept positions unless they are excited about their futures and can see them "in Technicolor," each person will put a different degree of emphasis on the financial aspect of an opportunity. We never "twist a candidate's arm" to accept an offer, nor even to go out on an interview. Our experience is that the "right" person always gets hired into the "right" position, with very few exceptions. By "right" we mean that it's the right company for the right candidate at the right time - and at the right compensation. When all of this lines up correctly, the company knows it; the candidate knows it; and the placement is a "win/win" fulfilled opportunity for both sides.