10 Ways to Still Get Search Fees

In a recent article, 10 Ways to Avoid Paying Search Fees, I made the case that larger companies have targeted third-party recruiter (TPR) expenses as a major cost-saving opportunity. Up until a few years ago, my own prediction was that success was unlikely until these companies started aggressively pursuing less active candidates. While it might take a few more years, this fundamental shift is now underway. More and more companies are now proactively getting the names of top people by networking with current employees, leveraging competitive intelligence, and using targeted job-branded advertising. These common TPR techniques are no longer off limits to the corporate recruiter. Here’s a sample of the sentiment in Corporate America. At a recent get-together of the entire recruiting department of a Fortune 100 company, the VP of HR opened the two-day conference with this comment: “You’re here so that we will never have to pay search fees again.” TPRs I hope you’re listening. It’s the sound of change. Of course, TPRs will still be able to earn fees, but it will be a different future. You can help create it ó and prosper ó or you can fight it or ignore it completely. The choice is yours. At the moment, most corporate recruiters handle too many assignments, so TPRs still have a short-term advantage. In my opinion, this advantage will be short-lived. Here are some ideas on how to leverage this window of opportunity before it closes:

  1. Be different. Offer different services, different candidates, different fees or different approaches. One way is to provide value-added services like testing, training, adding a formal on-boarding program, or something that distinguishes your firm from the others. Perhaps you can become an expert at something. Why not speak at hiring manager professional association meeting, and explain how they can accurately assess new sales reps or Java developers? Why not become a technical expert and offer a training course for your candidates on solution selling or new developments in medical technology? Then offer your clients your best students.
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  3. Specialize. If you’re the person everyone knows knows everyone, you’ll be big. This means you go to conferences, network with industry leaders in your field, put people together for events pro bono, and network with everyone all the time. If you’re really into this, you probably added six to eight people ó great people ó into your network today. If you can deliver top people in hard-to-fill positions within a few days of getting an assignment, you’ll be a success. In fact, you probably already are.
  4. Get great at marketing. Forget the stale HR networking events. Be bold. Be different. Become an industry expert. Speak at bigger events. Offer to make presentations to your clients’ hiring managers. Conduct real research (on compensation trends, demographic changes, outsourcing, or shifts in technology) and provide real insight into what’s happening in your field. Then make sure you present this info at conferences, webinars, or as part of someone else’s email blasts. Everyone’s looking for more great content. Why not provide it?
  5. Unbundle. Get under the radar. Be indirect. Every new assignment doesn’t need to be a complete search. Why not offer your clients a staged search approach with variable fees based on the breadth of services provided? This includes everything from just preparing a performance profile, to writing and posting ads, to screening resumes, to searching resumes databases, to conducting phone screens, or to conducting the whole search if the lower cost options don’t pan out.
  6. Become a partner, not a vendor. Be more than just a source of candidates. Give your advice away. One way is to lead the job preparation process. Offer to prepare a performance profile at no cost. Once your clients see how this can improve their selection process, you’ll be viewed as a coach and partner, not a vendor. Why not lead a panel interview of the finalists at no cost? You’ll quickly be seen as a expert, and a person sought after for advice.
  7. Get super creative with your fee schedule. Do something unusual or gutsy with your fee structure to gain attention. Here are some ideas:
    • Offer flexible fees based on quality and time to fill. If you find an “A” candidate within five days, you get a full fee. The fee declines the longer it takes or if the candidate quality is perceived to be lower.
    • Provide a 100% money-back guarantee for six months, even if they retain the person you placed.
    • Don’t charge a fee. Instead, after 90 days conduct a performance review on the person and base your fee on how well your candidate met expectations.
  8. Do more than your competitors. Presentation and professionalism counts. Make sure you present your candidates formally. (See my article How You Present Candidates Counts). At a minimum, submit a great resume and a formal assessment. Why not include reference checks and a Profiles International assessment? Describe why you believe your candidate can meet the primary performance objectives of the job, using examples of comparable accomplishments as proof. You might want to have the candidate write up his or her most significant team and individual accomplishments in detail and include these with your presentation. Show samples of these write-ups to your potential clients. You’ll get lots of referrals from your current clients when you offer the best candidate assessment package.
  9. Avoid (or work with) HR/recruiting. Do whatever works. With some companies it might help to work with HR/recruiting, in others it’s best to call functional VPs directly. In my opinion, you’ll get better results if you contact the boss of the hiring manager. For new clients, find out which jobs your target company is trying to fill (look at their site) then send in a few “A” players directly to the hiring manager’s boss. This will gain you instant credibility, plus the leverage you need to get your candidates seen and hired.
  10. Give away some candidates in order to gain the hard-to-fill assignments. We offer a low cost eSearch for candidates we can find on job boards. We’ve found some great “A” players with great advertising (see my article on semi-sourcing) this way. We also offer this as a preliminary step in exchange for a full retained search if the lower cost option fails.
  11. Go small. Change your customer base. Put together a target list of potential clients. Select those that are growing, changing, and those with smaller HR/recruiting staffs. All need your help. While more mature companies are insourcing their recruiting departments, there is plenty of opportunity with these other companies. Above all else, don’t do what every other recruiter is doing. Make sure you’re different when making first contact. You might even want to send your potential new clients a book (suggestions: First, Break All of the Rules; Hire With Your Head; Good to Great) as an attention-getter. People will generally spend an hour with you when you send them something like this. Tie the book to some service you provide. Then make sure you use the hour wisely. Review items 1-9 again for some ideas.

Just like any business, TPRs who are creative, nimble, and forward-thinking will prosper. Many TPRs are feeling flush again with the recovering economy. In my opinion you can’t build your business only for the good times. Of course, there are other ways to provide needed recruiting services to your client companies than those mentioned here. I’d suggest you come up with your own “10 best” list and try every one out. Then come up with another list and then another, and try these ideas out as well. Keep this changing and evolving process going. Soon it will be a habit. This is probably the best idea of them all.

Lou Adler is the CEO and founder of The Adler Group – a training and search firm helping companies implement Performance-based Hiring℠. Adler is the author of the Amazon top-10 best-seller, Hire With Your Head (John Wiley & Sons, 3rd Edition, 2007). His most recent book has just been published, The Essential Guide for Hiring & Getting Hired (Workbench, 2013). He is also the author of the award-winning Nightingale-Conant audio program, Talent Rules! Using Performance-based Hiring to Build Great Teams (2007).

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7 Comments on “10 Ways to Still Get Search Fees

  1. Good article Lou.

    Don’t forget to add:

    Point #11: Work with their competition!! (If you can’t recruit for the best player in the industry you’ve chosen, why not help their competitor become the best player in the industry?)

    Point #12: Work with the manager/employee you placed to gain insider information about their company and prospective openings. Ask them to refer you to hiring managers.

    I would suggest that most good recruiters have already been serving as facilitators and relationship conduits for their customers and candidates alike for years. Thinking outside of the box when it comes to promoting and delivering those valuable services to current and new customers is definitely the challenge. Your tips always promote thought and a response. Thank you.

    PS: Offering to work for free for a number of months before being paid is already the signature trademark of a contingency recruiter. We call it the ‘hurry up and wait’ policy. You know, the one where the client tries to do the tough recruiting of non-active candidates themselves for a number of months without success, then calls us up to help them out. We give them great candidates in a hurry because ‘we needed the guy yesterday!’ The client then decides to have meeting after meeting after meeting followed by vacations, coffee breaks, evaluations, sick leaves, car repairs, hr shuffles, treat the TPR like a virus and then waits until the beginning of the next fiscal quarter to consider making a decision. May I suggest, offering the clients a substantial fee break (ok, discount — there I said it) if they agree to pull the trigger (hire) within a short, recruiter designated time frame from date of first candidate presentation. I found two (2) weeks to be effective. I have used this offer with select new but particularly small clients.

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  2. Interesting article Lou but heres my perspective albeit from the UK / EMEA side.

    TPRs enjoy huge fees for churning the same names through clients (who then become targets).

    Nobody would argue that the return on investment is not significant if we get top performers and yes it is up to us to ensure they are top performers.

    I have worked with WW Search firms and smaller ’boutique’ shops but the message of change is not sinking in.

    The amount of times I hear the phrase ‘I have the directory of my last client if you need it’ drives me mad 🙁 or my other favourite is ‘I just placed this guy and he is looking for a move!’

    TPRs Flame on!

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  3. Dan,
    If you are hearing that from TPRs, then you need to cut them loose. Working with a TPR is just like working with any other company that provides you a service; if you don’t like their practices, then fire them.
    There are plenty of us ethical recruiters out here.

    Sherry Karr

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  4. Dan-

    While I don;t necessarily consider myself one of ‘them’, I don’t consider myself a protypical in-house recruiter either.

    If you’re an inside recruiter and you really (I mean REALLY) are committed to your profession, that means you’re working and thinking 24/7. This is how the the great recruiters function – in house or TPR. Without a doubt there are churn TPRs just as there are in-house folks who live and die by the job board.

    So let’s do it by the numbers – say you’re earning $80K US and you’re a 24/7 (OK, I’ll take off 5 hours per day to sleep) kind of recruiter who takes four weeks vacation (and we’ll even assume you don’t bring business cards with you to network). That works out to $12.53 per hour.

    Sounds like a bargain.

    Also sounds like someone is in need of psychological help. 😉

    My question is why are folks in the UK doing business with the bottom feeders and not creating alliances with better firms? You can’t be saying that your company doesn’t know how to identify and work with these types of firms?

    Thinking bad thoughts about a group only makes it easier to internally rationalize these thoughts. I’d suggest that UK and EC based TPRs who are ethical and hardworking use this as an opportunity to develop a relationship with a UK-based company (if you wink, wink, hint, hint, know what I mean!).

    cheers!

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  5. If you are working with TPR’s that feed those lines to you, such as ‘I just placed this guy and he is looking for a move!’ or ‘I have the directory of my last client if you need it’ then you are working with the bottom 10% of all of the TPR’s out here.

    Just as we are asked not to generalize about how corporate recruiters handle searches, I would ask that you possibly search, when the need arises, for a TPR that is worth their fee – who really does recruit those candidates that aren’t looking, and who doesn’t source the internet for people to ‘sell’ to you at a fee.

    We are out here….we are the successful ones. We provide a REAL service.

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  6. Dan,

    I can tell you that I, as a TPR, do not do business the way you just described. Maybe you should switch to a more ethical TPR…I am just one of many.

    My goal is the same as any business owner, I wish to build up a client base that will provide return business. It’s much easier on my budget (and my sleep patterns) when I know I have a dependable client who provides me consistent business. In order for that to happen, I have to be true to my client. Also when HR Recruiters talk, I would rather them discuss my efforts in a favorable light than slam me.

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