What’s the difference between executive search and recruitment?

Not all recruitment is the same. The process used in executive search is fundamentally different to the same process used in recruitment firms (typically contingent ones).

Let's look at the key differences to show why the search process is the best approach.

What is Executive Search?

Executive search companies get to understand your business, your goals and your values and then search the world to find the professional that shares your values and has the skills necessary to succeed in their role. 

The search will include passive candidates (those who are not looking to move) as well as active candidates (those who are currently in the job market).

They act as an extension of your own firm, selling your vision and taking time to show amazing professionals how their next big career move needs to be with you.

Because they work with more senior hires, the cost of a mistake is huge.  Executive search firms, therefore, spend a longer period of time screening and testing each candidate before sending them to you

What is recruitment?

Recruitment firms will focus on understanding the job requirements and finding candidates who are both actively looking for a new role and have the skills that might make them a good fit for your business.

They will post your job on various job boards and use an existing database to find who the most appropriate talent is amongst the current set of active candidates.

They may pre-screen but this will be rudimentary as they will expect you to be doing the majority of the fit-based interviews.

Despite the superior outcomes that Executive Search brings, Recruitment is a cheaper service because it requires less of the recruitment firm’s time.

Berg's unique business model ensures that you get an executive search-level service for less than the cost of a recruiter.

What is the difference between executive search firms and recruitment firms?

What work do they do during a kick-off process?

In general, Recruitment firms spend less time with you before launching the candidate search and most of the time will be spent on the job description and the functional skills that the candidate possesses.

Because every additional hour worked costs money, there is a delicate balancing act between getting the right amount of information in order to conduct the business.

Executive Firms want to hear your story, your vision and how your business succeeds. They are preparing to be your evangelists in the market and so they need to be able to tell your story as well as you can. This may involve being added to a group Slack or being present on your all hands.

They will then understand the role, how it fits into your organisation, and what success looks like as well as gather information on your competitors.

What kind of job roles do they focus on?

Recruitment agencies fill more junior roles where functional experience is most important.

• Junior positions
• Roles when personality is less important
• Candidates with multiple skills matching different roles

Executive search firms seek candidates who are the best in class and consider your values to a much larger degree (in addition to functional ability).

• Executive level positions
• Technical abilities
• Roles where personality matters
• Hard-to-find positions
• Business critical positions.

How do they attract candidates?

Recruitment firms post job openings online on sites such as LinkedIn and applicants are considered in tandem with those that exist on their database.

Once an executive search firm has built a thorough understanding of your business, your vision and your values, they will conduct a complex market mapping exercise to understand where great talent may be found and then actively locate and convince this talent to enter your process.

What type of candidates do they attract?

Recruitment agencies prospect mostly active candidates. These are people who are actively looking to move because of dissatisfaction with their current roles or because they don’t currently have one.

Executive search companies seek a mix of passive and active candidates. Passive candidates are professionals who aren’t actively looking to move companies. They are happy, successful, capable and have at least some of the values that could help your business go from good to great. Imagine asking one of your customers who’s the best salesperson that you compete with? Don’t you want them on your team?

Vetting process

Recruitment agencies will first check that the candidates have the right skills to match the brief. If you are looking for a Sales Director and the person has sales experience at a reputable company, they will likely be put through to a screening. Some candidates (if they look great on paper) won’t be screened but others will be subject to a screening interview. This interview could be short or long depending on the quality of the firm.

Executive search firms will similarly ensure that the person has the right skills to match the brief but they will also pay close attention to how successful that person has been in their career ie do they hop from job to job, do they make parallel moves, what kind of companies have they worked for and how have those companies fared.

They will conduct at least an hour (and up to three hours) of interviews where they will go through that person’s history and try to clearly discern if that person has the values and character that you need. They will also try and understand how humble, hungry and emotionally smart the candidate is as well as the reality of the CV.

Quantity Vs. Quality

Recruiting agencies try to fill a large number of posts and their team are usually heavily incentivized on the number of deals closed (Top Biller, anyone?) They spend a relatively small amount of time scrutinising each application. The aim is to find ‘good enough’ candidates for different positions.

Executive search firms focus on filling a specific position by hiring the best person for the job. They meticulously inspect each candidate to ensure the best fit for a position and deliver a short list of exceptional talent for you to consider.

Presentation

Recruitment firms will present a steady stream of candidates as and when they find people that pass the basics. You will usually receive a CV as well as a paragraph on why the person may be a good fit (but that isn’t always the case).

Executive search firms will provide thorough reports on each of the candidates, including the CV and notes from the interviews about how each candidate exhibited successes, values and ethics throughout their careers. These stories will then be re-verified through the reference process.

Which is Better: An Executive Search or a Recruitment Firm?

Putting costs to one side, the search process is clearly better than the recruitment process.

If you want to move your company from good to great, you need stars. The people that have clear success running through their careers, that share your values and are highly regarded by their own organisations. Occasionally, those A-players will look actively for new opportunities but this doesn’t happen often. A-players will have a degree of loyalty and the self-motivation to drive past any short-term turbulence.

If you know the shape of the puzzle piece, you need a firm that will work tirelessly to find the piece that fits, not one that’s ‘nearly there.’

Why then does the recruitment industry exist at all?

Cost.

An executive search firm requires more time and more people. For example, the average fee charged by Korn Ferry is around $130,000. That wouldn’t make sense if you were hiring an SDR or an engineering graduate.

For more junior roles where skillset matching is most important, recruitment is a much more cost-effective approach. You’ll have a higher percentage of bad hires but the cost including those bad hires probably won’t exceed $130,000.

Historically, executive search has been used in roles where the impact of that person on the organisation is large. Where they manage a team, are responsible for PnL or set strategy. The cost of a bad hire here is incalculable and why risk your business to save what is usually 20-30% of a salary of one person?

The best of both worlds

At Berg, we don’t need to earn 30% profit margins. We are headquartered in Athens and as a result, are able to deliver the Executive Search quality for a price below what you’d pay to a ‘nearly there’ recruitment firm.

• We search for the best Passive candidates for every role (not just execs)
• We put our money where our mouth is and base our commission on that person’s performance after six months in the role
• Our Founders have had extremely successful careers outside of recruitment. We’ve hired each role personally, and seen the benefit of a great hire and importantly, the cost of a bad one.