Way Forward for Recruitment Agencies: Death, Delivery & Irresistibility


A lot of B2B marketing pitches that we make for cajobportal.com eventually end up with this standard answer “We have our own in-house team”.

The argument that has gained currency in today’s times that the in-house recruiter is inarguably better equipped to direct source and understandably miss out the recruitment agency and their fees.

We often chance across resumes of HR professionals that proudly state

  1. Executive Hiring – Hired 23 Top Management executives in 2 years without the support of Staffing Agencies in 2015
  2. Brought down dependence on staffing agencies from 87% to 11% in 5 months
  3. Improved hiring through social networking sites (18%) and non-conventional hiring strategies thereby reducing Cost per Hire.

Let’s face it, for most HR individuals in companies using an agency is a grudge purchase.

It does not make HR look good when recruiters are filling most of the roles within their company structures even more so when that company has invested in an in house recruitment team. It seems search firms are increasingly being viewed as competitors rather than partners

As a recruitment agency founder, with my fees to defend; thus, it has been crucial to me also, to understand and read the evolution of the recruitment cycle.

Acid Test for recruitment agencies

There are so few barriers to entry for this industry that it is inevitably going to see new entrants all of the time. In India, all it takes is purchasing a Naukri Resdex subscription and becoming a so-called ‘consultant’

One can raise some very pertinent questions about the future of the recruitment industry

  • Is the industry dead anytime soon?
  • What is the purpose of a client paying an 8.33% fee anymore?
  • Is there a point to a generic recruitment agency any longer?
  • Are we no longer getting the expertise and value add that a consultancy should provide?

The strategic focus needs to be revisited and agencies need to ask themselves as well as their clients

  • What are the traits of a recruitment agency that still has value?
  • How does the recruitment agency become a genuine and authoritative specialist?
  • What does an agency have to be, to ensure they are better positioned than the client in our designated markets?

Great Expectations

The generalist approach of advertising for a response or trawling the same job boards the onsite individual has, doesn’t add value and isn’t expertise.

Not surprisingly, it does not get the reverence it used to, anymore.


Unless the agency is catering to a niche, it can’t add enough value to do anything other than spread the workload of the internal recruiter to an external agency. Thus, for sure, blinkered recruitment agencies that have executives chained to the desk with cold call approaches, job board adverts and gatekeeper dodging tactics aren’t going to cut the mustard anymore.

So in case of finance recruitment, the conversation with candidates’ should ideally revolve around IFRS and GST instead of just the clichéd CTC, location and notice period.

Brand Ambassador

From the corporate in-house recruitment professional, the expectation is now around access and insight to the market in which they are seeking candidates, the recruiter giving them trust that they know their way around it and can with precision and speed access and engage with role relevant candidates. Plus the assurance that the process accurately has as an underlying the company’s brand, culture and the true nature of its EVP.

Engagement with candidates

As the number of Generation Y — and soon, Gen Z — workers continues to increase, these employees’ expectations about the hiring process differ from those of older generations.

Raised on technology, [millennials] do not accept many legacy concepts of recruiting and work. To be effective, recruiters are going to need to engage Gen Y candidates in new ways.

Most candidates are loathe to being treated like on-line commodities.

Senior level Candidates will become increasingly distrustful of applying online or responding to a direct client call—both of which gives them restrictive response & little room for negotiations.

They prefer to have a dialogue with those who they perceive as neutral, more responsive and trustworthy basis their long term relationships, rather than directly with an organization.

Passive Candidates

With a tightening candidate pool and the forces of VUCA all around, agencies will be a lifeline to accessing talent.

Equally relevant is the dimension of “passive candidates” — individuals who aren’t necessarily seeking a job, but are open to new opportunities.

On-line tools can only go so far in finding talent, as the best talent is often hidden.

Executive search firms will have the upper hand in accessing a client’s direct competitors and a more intuitive approach to searching in less obvious places, digging deep into other sectors – often with parallel functional disciplines – and bringing to the table the best athletes, the rising stars, the unexpected discoveries that can make a radical difference to a client’s company.

Agencies that survive need to demonstrate that they are the ones best connected to the passive talent pool & the rising “super-stars” of the industry. They are the ones who can showcase that cost saved in hiring key talent directly is actually a huge cost-incurred in not hiring the best through specialists in the business.

Lateral thinking and acute assessment


To compete with in-house recruitment, executive search firms need to bring a new dimension.

Finding top candidates is just the start. Executive search firms will need to be pioneers in assessing constantly evolving executive genres. The current trend is to select on future promise, rather than past performance, which takes a blend of science and art, psychology and psychiatry.

The best firms will develop their own proprietary methods, adopting the strengths of respected psychometric tools and combining them with feedback from their own client base, cross industry and cross geography.

Dawn of a new era

Will the bums on seats agencies still exist and make money? Probably but not for the right reasons. Did I hear the word ‘kickbacks’? (Yes, there have been instances where the in-house TA guy searches the candidate but routes it through the agency so that the proceeds can be shared.But lets leave it for another day)

For me, the future of recruitment agencies is to learn how to sell a real recruitment solution rather than the vague ‘candidate trading’ service most of them currently sell

The model needs to change and evolve to include true market mapping and talent pipelining capabilities as an ongoing service for clients. The agency that gets this right, coupled with the ability to build and run talent communities, on-going talent engagement (curated relevant content) will be close to irresistible

Summing Up

Technology and automation might be leaking into the industry but recruitment is fundamentally a social negotiation that needs a human touch. The process might be streamlined and the work itself given a face lift but it will remain a social practice at its core.

Executive search of the future will definitely flourish but in a new avatar. Those who are able to change tracks quickly will definitely do extremely well. But it will be the survival of the smartest.

There are hairdressers failing all the time. People still need to have their haircut – it is just the service given at the price offered is not good enough for those who fail. Applied to recruitment it becomes obvious.


By the way, I’m merely opening the discussion up here, rather than providing answers. I’m asking questions which we need to consider in how the future recruitment agency operates.

Your inputs shall be immensely valuable.


Thanks & Regards


Founder: cajobportal.com, Kolkata