Should you rely on internal talent acquisition teams or on independent headhunting firms for your hiring strategy? With this article I will aim to demonstrate why this is very much the wrong question to ask.
Internal and External recruiters have different strengths and capabilities, and as such can both benefit a hiring organisation tremendously.
While there can certainly be an overlap in ultimate objectives to some extent, these two types of HR professionals and units serve a different and unique purpose when it comes to the employment and talent attraction strategy of an organisation. Most companies would benefit greatly both from understanding the differences and unique strengths of headhunters and internal recruiters, and from optimally utilising their services.
Here are my 9 general reasons why in-house HR teams cannot provide an effectual replacement for the services of quality recruitment agencies for all of the company’s hiring needs. The operative word in the previous sentence was “all” because – especially for larger organisations – an internal recruitment team may very well be the best option for filling a large number of the job vacancies within the company, and for ensuring a regular flow of suitable candidate applications for the teams. The thesis I will aim to convey is that internal and external recruiters have different strengths and capabilities, and as such can both benefit a hiring organisation tremendously if employed in the right way and the right circumstances.
9 Key Differentiators Between Recruitment Firms & In-house Recruitment Teams
1. Challenging, critical or specialist roles
I’d venture to say that the number one reason hiring managers turn to external talent search professionals for assistance, when they have not sought the services of rec firms in the past, is the need to fill a very niche, challenging or critical position within their organisation. There are many different scenarios – the position may require someone with exceptional skills in a specific area, or a rare combination of different hard and soft skills, or it could fall within a specialist field which is often characterised by talent shortages. In such situations it is almost always necessary to reach out to a proven, qualified headhunter who specialises in this particular domain. Challenging searches like these require a lot of dedication, focus, specific tools, industry knowledge, sales and communication skills which a high-quality search agent can provide by definition.
Filling complex and specialist vacancies is the bread and butter of recruitment and executive search consultants.
While each company is unique in its setup and operating style, as a general rule internal talent acquisition teams have a lot on their plate. Some of their key responsibilities nowadays include employer branding, talent attraction and sourcing, job advertising, overseeing recruitment, coordinating interviews, tests and trainings, implementing and improving HR processes, gathering requirements and collaborating with numerous hiring managers, overseeing budgets, working on employee relations, referrals and retention strategies. The sheer number of positions they typically are responsible for filling already translates to certain limitations in terms of time and focus which are beyond their control, but combined with all of the other responsibilities that accompany their job, this clearly means that the most challenging and complex job vacancies which cannot be filled through proactive job applications – will remain open for extended periods of time.
On the other hand, filling complex and specialist vacancies is the bread and butter of recruitment and executive search consultants – they will be dedicating all of their time on such searches, and with retained firms, will even guarantee a successful placement. This will save the employer time as well as costs, associated with leaving a critical vacancy unfilled.
2. Passive talent
At this stage it is vital to point out an important distinction – a work vacancy can be filled either by a job applicant, or by a candidate. An applicant is someone who is at the time actively looking for a new career opportunity. It is applicants who answer job ads, submit their CVs through job boards and CV databases, etc. In contrast, we refer to candidates who are generally happy with their current position and employer and not actively looking for a change as “passive talent”. Needless to say, the identification, engagement and attraction of passive talent requires a very different approach and skillset from posting a job advertisement and reviewing the applications received. To put it simply – recruiting passive candidates requires exceptional, well-rounded recruiting skills. As a general rule, in-house teams largely rely on vetting applicant profiles when trying to fill a job vacancy – indeed there are recruitment firms who base their strategy on such an approach, too. Headhunters and executive search firms, however, focus most of their energy and time on identifying, networking with and attracting specialists who are not (proactively) on the job market.
Internal recruitment teams are often absolutely necessary for supplying qualified staff, especially in larger organisations. However, as we already pointed out, they tend to have a large scope of day-to-day responsibilities. This is why when dealing with job openings which are crucial to the business strategy and would require timely and specialised hiring services, reaching out to an external headhunter is often the quickest and most cost-effective option.
Еxternal headhunters are paid on success. They are rewarded for results, not for activity.
4. Guarantees and replacement options
Few things are more central to a company’s success than its lifeblood – a motivated, competent, well-appointed staff. Now, recruitment is not exact science, but one of the most significant distinctions between internal recruiters and retained recruitment consultants is the risk factor: external headhunters are paid on success. They are rewarded for results, not for activity. This is why employing the services of a qualified staffing consultant can greatly increase the chances of a successful hire – in fact many recruitment firms guarantee that they will fill a given vacancy, i.e. they will search the market and work with the client until a suitable candidate is engaged by the hiring company. They also provide free replacement services – in case the selected candidate turns out not to be the right fit, they will restart and complete the recruitment process at no extra cost.
Both internal and external recruiters are excellent networkers and tend to be very well connected with professionals in their field of work online and offline. It is however important to note, that candidates who may be considering a change or who are curious about what options are available to them in the market, are much more likely to reach out to an independent recruiter, as the latter work with a variety of clients across the industry, thus in the long run can contact them about different opportunities and a range of potential employers. External search consultants are also able to advise them about market rates, updates on the job market and can provide insights about different companies, while offering impartial counsel. Contacting an in-house recruiter while you still work for a competitor company can be tricky in terms of confidentiality, and at the same time – would only be relevant if the candidate is specifically interested in career opportunities at that particular employer.
Tautology aside, independent recruiters are consultants in every sense of the word. They collaborate with a variety of clients, candidates and applicants, and their work is project-driven, each assignment being approached individually by analysing an array of variables, where the end goal is a win-win-win. These conditions create an environment of unique trust and open communication between the hiring manager and the headhunter on one side, and the candidate and headhunter on the other. A bit like with doctors and accountants, the process works best when the parties are thoroughly honest with the independent recruiter about their current situation, issues, requirements and expectations. It is then the job of the recruiter to take all factors and nuances into consideration and facilitate the entire end-to-end process, acting as a mediator, market expert, adviser and superior communicator. Like any other type of professional consultant, a good recruiter wears a multitude of hats on any given day.
The position of the in-house recruiter dictates that they are an extension of the company they represent, thus there are more limitations on the amount and type of information the candidate would be able to share as part of such a relationship. On the other hand, the candidate can establish a long-term working relationship with the independent recruiter and collaborate with them for many different vacancies throughout the years.
7. Free brand representation
This is a point which few hiring companies take into account, but one which is rapidly growing in importance, with the part that social media and brand awareness play in our society. Communication and connectedness are central to a headhunter’s role in their industry niche. Having information about your company brand, culture, values, products and services and sharing it with the specialists and leaders within the vertical, leads to a significant boost to the company’s brand awareness and influence. It is after all part of the recruiter’s function to represent the client as an employer of choice.
As an aside, how applicants and candidates are approached and treated throughout the entire recruitment process is extremely important for the company’s reputation.
We already highlighted the distinction between recruiting job applicants, actively looking for a new career assignment, and recruiting professionals who are not at the time considering a job change. It is important to mention also, that a key reason as to why internal recruiters don’t generally rely on proactive headhunting to fill vacancies, is that there are certain implications relating to directly approaching your competitors’ employees. Independent search consultants, however, are not restricted when it comes to contacting representatives of any organisation – the only exception being employees of their clients, who they have an off-limits agreement with.
Both in-house recruitment teams and external headhunters have never been more needed.
As you can see, this is far from a black-and-white topic. The following factors should also be taken into consideration when deciding on the recruitment specialists to do business with:
- The type of hiring company and its recruitment needs and strategies;
- The types of positions which need filling;
- The type of recruitment agency (contingency vs retained vs executive search);
- The volume of vacancies;
- The profile and responsibilities of the internal talent acquisition team;
One thing is clear to the author, however – in a world which is always busy and short of time; when our reputations always precede us; where companies are faced with increased competition and looming talent shortages; while candidates expect their job to be so much more than a source of income, but rather a key outlet for creativity, passion and self-actualization – both in-house recruitment teams and external headhunters have never been more needed.
Leaders who have found a way to utilise the unique strengths and purpose of both, only stand to gain.