Turning down retainers – Just say “no”
Many of my long-standing clients will ask me to help them fill executive positions on a retained search basis. In most cases those projects work out extremely well for both parties including the placed employee. These are well-run companies that I can represent effectively in the job market, and attract prospective candidates to consider a new career opportunity. These positions are critical to the success of the organization so the retained search approach makes perfect sense. They pay me for the process of being extremely thorough and accurate so that all targeted candidates and prospects will be contacted at least twice. In those situations it’s a win-win for all parties involved because the hiring manager is getting complete reach and frequency of their message to targeted individuals, the prospects are getting consistent, accurate information about the opportunity, and I’m assured of a well-run process that will result in a placement of a high-quality employee in a top-tier organization.
I wish all retained search projects had such ideal outcomes, but unfortunately they don’t. From time to time I’ll speak with prospective clients about their staffing needs and they will request a retained search despite a lack of key elements in place that are required for such a project to be successful. For instance, they may be seeking a person that doesn’t exist: such an extensive combination of qualifications that it will be extremely difficult to even find such a person much less convince them to quit their job and take the new one. Another common problem occurs when the company has such a negative reputation that few qualified, talented people will consider working for them. In many other cases, the job has been open for so long that nearly all qualified prospects for it have already been made aware of it and have passed. And of course there is the problem of non-competitive wages and the inability to financially incent a prospect to make a job change.
Each of these problems, or a combination of them, lead to the low likelihood of filling the job in a timely manner with the “A Player” that all companies are seeking. And although the retainers pay the bills, as a professional Search Consultant I could and should be working on other projects that will yield success and happy clients in a much more timely manner. A recruiter can burn up months of unproductive time working on bad searches that do not justify a retainer. The recruiter can also develop a reputation of poor performance because they accepted a retainer and then could not fill the job. Sometimes they foolishly accept a retainer to fill a job that is well outside their area of specialization, knowing in advance that they are unlikely to fill the job quickly. But more often the reason for failing on the search is something completely out of their control.
Sometimes I don’t know that the project is unlikely to succeed until I get into it and begin speaking with prospects in the marketplace. There have been occasions where I’ve returned the initial retainer or not cashed the check until I know there is a likelihood of success. If I’m doing my job correctly I can avoid those situations by asking the tough questions in the initial discussion about how I might be able to help them fill the job. Those include questions about the hiring manager’s timeline and urgency to fill the job, the history of their prior attempts to fill the job, the financial package, as well as their insistence of finding the perfect combination of qualifications.
There is an old adage in the recruiting industry about not getting “married” to a bad search. When it’s clear that the project is not set up for success, I feel obligated to “just say no” to a retainer and explain why I can’t take the money and commit to the project. I will often recommend a contingency search approach in those cases (where I don’t get paid until I fill the opening), which is nothing short of heresy to many recruiting firms. The reality is that I would rather be “dating” a bad search and spending the majority of my time on other projects that have a high likelihood of success. Along the way there is a good chance I’ll be able to match a candidate with that company, since I work in a highly specialized niche (marketing professionals in the medical technology industry), but I can’t guarantee that will happen.
My goal in turning down a retainer is to have an honest conversation about how to improve the situation and help the would-be client fix their problems. Those problems are not easily fixed in the short term, however, so we end up either running a contingency search or re-visiting the prospect of working together in the future. In the search profession we have the opportunity to build long-term success by turning down potential business that doesn’t make sense. And although my profession can seem at times to be focused on short-term transactions, it’s the long-term relationships and personal reputations that matter most.