To retain or not to retain

Sridhar Murthy, Longhouse Consulting

Why should a client pay a retainer fee to hire senior talent? Isn't it better to have a whole lot of consultants working on a position to ensure success in finding the right talent? These are some of the questions that run through the minds of many people in the recruitment industry and very valid too. However, one big question always almost is never asked, and this, I believe, in itself answers these questions and doubts about hiring recruitment firms on a retainer basis."What do I lose if I don't run a focused effort to hire senior talent?". The obvious answer is Time and only Time... right?.

Understanding and attracting senior talent in India requires tremendous amount of "focus" and more importantly close interaction between all stakeholders. The process requires focus from the company which wants to hire and also from the consulting firm that is helping their client to hire. It is a given challenge that a company will not be able to efficiently engage with many consultants in a focused way and at the same time, given the success based incentive system the consulting firm will not be able to put the right amount of resources required to focus on such important searches. Further, in this scenario the feedback loop between the company and the consultant is slower and not effective as there is lack of clarity on who is accountable and who is driving the search. Hence, this lack of focus can often result in large amounts of delay in identifying the right candidate for the job. Though no explicit money is being spent in this process, we need to account for the implicit impact this is having on the company's bottom-line given the importance of such roles. Yes, we are talking about the basic fundamentals of "opportunity cost" that many of us fail to identify and account for during the recruitment process. This is like trying to make a hole in the wall with soft pins when what you really need is a sharp nail and the right hammer. So, if you are looking to hire for a critical position in your company, I'd say it's time to pick up the right hammer and the sharpest nail!

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