State of The Executive Search Firms in India

Author : Leadership Hiring | Published On : 22 Apr 2024

India's booming economy is creating a fierce competition for leadership talent. To secure the best and brightest, companies are increasingly turning to executive search firms. These specialized recruiters boast extensive networks and deep industry knowledge, making them invaluable partners in the C-suite talent hunt.

But with a growing number of players, how do you find the right executive search firm for your needs?

What is an Executive Search Firm?

An executive search firm, also sometimes called a headhunting firm, acts as a specialized recruiter for high-level leadership positions. These firms focus on filling critical roles at the top of an organization, typically for C-suite executives like CEOs, CFOs, and CMOs, as well as senior management positions.

Here's a breakdown of what executive search firms can do for your leadership hiring:

Targeted Recruitment: Unlike general recruiters who cast a wide net, executive search firms take a more targeted approach. They have deep industry knowledge and extensive networks to identify the most qualified candidates, often including those who aren't actively seeking new opportunities.
Meticulous Selection: The search process goes beyond just resumes. Executive search firms conduct in-depth interviews, reference checks, and skill assessments to ensure a perfect fit between the candidate and the company's culture and needs.
Market Expertise: These firms stay on top of industry trends and leadership needs. They understand the specific challenges and opportunities within a particular sector, allowing them to identify the best talent for the job.
Streamlined Process: Executive search firms handle the entire recruitment process, from initial candidate identification to negotiation and onboarding. This saves companies valuable time and resources.

What is a difference between a retained search model and a contingent search model

The key difference between a retained executive search firm and a contingent search model lies in payment structure and approach.

Retained Executive Search:

Payment: Firms are paid a retainer fee upfront, regardless of whether they fill the position. This fee is typically a percentage of the target candidate's first-year compensation, often paid in stages throughout the search.
Approach: Retained executive search firm offer a more invested and personalized service. They take a deep dive into your company culture, ideal candidate profile, and industry needs. They leverage extensive networks and in-depth research to identify top talent, often including passive candidates not actively seeking new roles. Additionally, they handle the entire recruitment process, from initial contact to offer negotiation.

Contingent Search Model:

Payment: Firms are only paid a fee if they successfully place a candidate in the role. This fee is typically a percentage of the first-year compensation.
Approach: This model focuses on speed and efficiency. Recruiters often rely on job boards and existing candidate databases to source potential candidates who actively seek new positions. They might handle a larger volume of candidates, with less emphasis on cultural fit or deep industry knowledge.

What is the executive search business in India

The retained executive search/headhunting space in India is valued at anywhere between Rs 1,500-2,500 crore and focused on executive/senior talent, is seeing more players enter the fray as India Inc seeks more leaders and C-suite professionals to build and drive businesses.

Growing at 15-20% year-on-year, India’s retained executive search market has a mix of global search majors, search network firms, mixed model firms, boutique players and even one/two person outfits.

Globally, five firms

Top executive search firms in India generally take fees about one-third of the first-year compensation for the candidate hired – typically paid in three tranches: at the start of the search, 60 days into the process and finally, when the candidate is hired. Lower down the order, fees vary, with some firms charging anywhere between 20-30% of compensation.