Maximizing Returns: Why Professional and Executive Talent Search is a Good ROI for Companies of All Sizes
In today’s economy, securing and retaining top talent poses new challenges. Businesses rebounding from the pandemic are seeking to grow and invest in talent amid economic uncertainty, intensifying competition for qualified individuals who match the job and company values.
Nearly 80% of employers are struggling to fill open positions in an unprecedented talent shortage — double the difficulty in 2015, according to a ManpowerGroup 2023 Talent Shortage Survey.
Getting the right hire — not just any hire — is imperative, as the cost of a bad hire or a mis-hire is likely more than you think. Costs vary based on the position, company, talent market, and other factors. Korn Ferry Hay Group research reports that replacing a manager within six to 12 months can cost 2.3 times their annual salary. For senior executive roles, the replacement cost may exceed $1 million, according to a Gallup Workplace Study.
Navigating the constantly evolving talent market demands continuous attention and proficiency in current practices, interview strategies, and recruitment technologies. Most companies lack the in-depth knowledge, time, or resources to source well-matched candidates efficiently and effectively, managing both speed and resources while ensuring quality and success. They often fall into the trap of wasting significant amounts of time and money, thinking they can attract top talent by simply posting jobs or relying on outdated recruiting methods.
Strategic hiring is vital for a company’s success, from senior executives to individual contributors. CEOs, business owners, and hiring managers can enhance their talent strategy by partnering with external consulting or search firms. These experts assist in finding and retaining top talent, fueling company growth and success.
In this article, we will discuss why partnering with talent consulting or search firms is a practical decision and a game-changing investment to ensure you have the talent you need to reach your business objectives.
The hidden costs of hiring: Exposing often overlooked costs
The true cost of hiring extends well beyond a candidate’s salary. It encompasses recruitment expenses, training investments, productivity losses during the hiring process, and the often-overlooked impacts on employee morale and company culture.
Delays in hiring and unfilled positions can significantly impact a company’s day-to-day operations and ability to achieve growth objectives. Every unfilled position represents an opportunity cost, with daily expenses adding up due to lost productivity, missed business opportunities, and increased workload on current employees. For instance, a manufacturing company recently faced hiring challenges, with several positions open for more than 45 days, each carrying an opportunity cost of $400 per day or $18,000 per vacant role.
The longer these positions remained vacant, the more profound the ripple effects within the organization. The company engaged RVR’s talent advisory and executive search services, using the Predictive Hiring Framework to develop a targeted recruitment strategy. This investment yielded an improved hiring process, a stronger employer brand, enhanced onboarding for performance, and top-quality hires.
Comparing external search models: Professional and executive vs. contingent search
Professional and executive search, sometimes called headhunting or outsourced recruiting, is a specialized and strategic approach to acquiring talent. The client company typically pays a retainer or an upfront engagement fee, often representing a portion of the total recruitment fee. This fee signifies the commitment to the search and typically ensures exclusivity, meaning the client will work solely with that search firm for the specific position.
The fee structure provides highly experienced, dedicated resources and customized services to identify and secure top-tier talent for critical roles. The value and outcome of this model generally lead to long-term partnerships, providing ongoing support and guidance throughout the recruiting, hiring, and onboarding process and beyond.
These specialized talent consulting and search firms possess a deep understanding of various industries, practices, and talent markets and the technical expertise necessary to navigate the ever-changing talent landscape and launch targeted recruitment marketing campaigns that showcase your unique employee value proposition. The result is an efficient process, a precisely matched candidate aligned with the role and your company’s values and objectives.
In recent years, these talent search services expanded their scope from solely executive leadership roles to encompass mid-level professional individual contributor, management, and senior leadership positions, reflecting a more comprehensive approach to talent acquisition.
A contingent search model is a recruitment approach usually adopted by recruiting or staffing agencies and is typically a more transactional approach. This model does not charge an upfront deposit, resource fee, or retainer; compensation is earned upon the candidates’ successful placement. While this initially appears cost-effective, the contingent search model notoriously falls short of delivering the exceptional return on investment (ROI) organizations seek.
The model’s competitive nature and lack of exclusive access, with multiple staffing agencies and internal recruiters simultaneously working on the same job opening, often lead to candidate duplication, competition, and, ultimately, a negative candidate experience. The quality of the candidate pool is restricted, as the contingent model emphasizes job postings, which attract candidates actively seeking employment and exclude passive or highly specialized candidates. Moreover, if the recruiters or agencies aren’t successful in locating candidates quickly, they may lose motivation and prioritize other clients with more immediate needs or easier-to-fill positions.
In-house recruitment challenges: Navigating complexities and talent market shifts
Companies often choose to recruit and hire employees in-house, but they may face difficulties and unsatisfactory results. Achieving success in recruitment requires a continuous focus on staying up to date with cutting-edge practices, candidate needs, compensation strategies, interview methodologies, and advanced recruitment technologies.
Regardless of their size, many companies lack the necessary resources to effectively recruit new talent, even if they have dedicated HR teams or in-house recruitment professionals. This issue is especially true for small and mid-sized businesses, which typically face more challenges than larger companies. As a result, companies often waste valuable time and money attempting to find and hire the right people, only to come up short.
When internal efforts are not yielding desired results, turning to external talent partners or recruiting and search experts becomes a valuable alternative. This approach leverages the specialized knowledge and network of experts to secure top-tier candidates, ensuring a faster hiring process and a greater likelihood of performance and retention.
Our proven approach: Predictive hiring framework underpins our success
Our unique approach is proven to predictively match and hire high-performing, engaged talent, streamlining the talent acquisition process with the following key components:
- Talent supply and demand research: Data-driven insights to meet your talent needs effectively.
- Compensation benchmark analysis: Customized guidance and market rate analysis for competitive compensation packages.
- Customized candidate search strategy: Developing a research-driven approach tailored to identify candidates uniquely suited for the role and organization.
- Employer value proposition development: Crafting a compelling brand narrative to attract top talent ideally qualified for the role and company.
- Scientifically backed assessments: Predict behavior and performance, avoiding hiring mistakes to ensure alignment with the position and company values.
- Custom interview strategies and guides: Role-specific tools and techniques, including a mix of behavioral, situational, cultural, and career development questions.
- Candidate offer and negotiation: Strategically guiding the offer and negotiation process to secure the ideal candidate for the organization.
- End-to-end support: Guiding companies through hiring, onboarding, and other stages of the employee lifecycle.
Tailored solutions: To conquer your toughest talent acquisition challenges
Organizations need tailored solutions to improve their hiring process and successfully hire candidates at all levels, ranging from C-level executives to vice presidents, directors, senior managers, and individual contributors. We accelerate hiring, reduce costs, improve retention, and enhance your brand.
Whether you need to hire for a single professional or executive role or have multiple critical positions to fill, RVR Talent has got you covered with customized solutions. Companies seek our services in all situations and stages of their business lifecycle, including those in high-growth mode, seeking leadership strength, merging with other organizations, expanding to new locations, building a new sales team for a product launch, or planning for succession.
Doing the same thing and expecting different results is not a viable solution. CEOs, business owners, and leaders must accept responsibility and accountability for improving talent outcomes. Shifting your mindset and investing in relevant talent strategies that align with your business strategy will undoubtedly drive the engagement and performance of your people and your business.
Ready to improve your talent strategies with a positive ROI? Reach out to us at 407-677-0400 or email firstname.lastname@example.org to gain a competitive edge in talent acquisition.
By: Karen Turner, Principal of RVR Consulting Group