Paid Search Executives vs. Contingency
Paid Executive Search involves a retainer fee, whereas Contingency Executive Search is payment-based upon successful placement.
Once upon a time, Paid Search Executives guaranteed a more thorough and exclusive search for high-level candidates than Contingency Search. Increasingly though, that retainer fee is harder to justify due to two reasons.
Firstly, there have been significant improvements around Contingency Search offerings and even some features that Paid Search Executives struggle to match, particularly around speed given the increasing notice periods of top talent.
Secondly, data from the Executive Search Information Exchange reveals that around 40% of traditional search approaches fail. In short, it becomes difficult to justify the retainer payments when the end result is no-one worth hiring.
For all these reasons, the underlying business model of “Paid Search” or “Contingency Search” is no longer a reliable guide to where your Search is safest or where you’re gaining greatest value. In fact, many are ditching retained search for hybrid models. The best advice is to look at the offerings and track records of individual firms to make your decision.