When retained search is worth it — and when it isn't
Retained search has a reputation problem. To a lot of hiring managers it sounds like the same service as contingency, just more expensive and slower. Sometimes that is fair. Often it isn't.
Here is the honest framing.
Where retained earns its fee
There are three conditions that usually make retained the right model:
- The role is confidential. You can't advertise it, your current incumbent doesn't know they are being replaced, or your competitors must not learn the role is open. Retained protects you because the search firm has skin in the game.
- The pool is small and senior. The right candidates are not active, can't be found on job boards, and need to be approached carefully and credibly. Volume models don't reach them.
- The cost of a bad hire is large. Leadership roles, head-of-function hires, succession appointments — the difference between a good fit and a near-miss is measured in months of organisational drift.
If two of the three apply, retained is probably the right shape. If all three apply, it is almost always the right shape.
Where retained is the wrong call
- A mid-level engineering hire with an active market
- A role you've successfully filled before with the same brief
- A role where you genuinely have time and are happy to compete on speed
For these, a well-run contingency engagement with a single trusted firm is usually faster and more commercially efficient. Paying a retainer here is paying for rigour you don't need.
The third option
There is a quieter middle ground that often fits better than either: embedded recruiting. A senior consultant working alongside your team for a fixed period, on a day-rate or fixed-term basis. It works well for scale-ups in build-out mode, or established businesses running a project-shaped wave of hiring.
The honest test
The right way to choose between models is to ask the search firm to tell you which one they would pick — and why they would walk away from the other two.
If the answer is "all of them, depending on the role, and here is the reasoning", you are talking to someone worth working with. If the answer is "always retained" or "always contingency", you are talking to someone selling a product.