By Kevin Flemming, CSP Kevin Flemming is president of Integrity Personnel, Inc., a Lehigh Valley-based staffing and recruiting firm. He writes about staffing issues for small and medium-sized employers. His column, "Talent Search," appears in the Eastern Pennsylvania Business Journal every third week of the month.

What do Carly Fiorina of Hewlett-Packard and Meg Whitman of eBay have in common? Besides being celebrity CEOs, they were both hired by their current employers through a corporate headhunting firm.

For decades, the placement industry (a.k.a. executive search) was known more as an exclusive service for Fortune 500 companies than as a cost-effective solution for small business. This was partially the fault of the industry itself. It’s a lot more exciting to brag about recruiting the hot new CEO or CFO than to discuss the nuances of identifying a really strong Accounts Receivable manager.

Nonetheless, many small and mid-sized employers have used third-party recruiting services to hire their core workforce due to a growing need for employees with specialized talent. These companies have seen the difference in quality between resumes produced through classified advertising and candidates selected by professional recruiters.

Placement is small business
Small companies especially benefit from developing a relationship with a recruiting firm due to the inherently high cost of hiring. If you only need to add five new employees a year, it would be hard to justify the $43,000 average annual salary of an inside recruiter, or even the $12,000 membership fee to one of the large Internet job sites.

Even if your company has used outside recruiting services to hire previous employees, you may not have a clear idea of how to evaluate its effectiveness. So how do you know which recruiting firm is right for your business? What criteria do you use to evaluate the quality of an individual recruiter? How do you control your costs while protecting your business from poor hiring choices?

Choosing the right match
The following questions address some criteria for measuring a placement firm’s capabilities. I won’t presume to give you predetermined answers. Rather, the questions themselves will provide you with the information necessary to make the right choice:

What type of business are they?

There are recruiting firms; temporary staffing services; employment agencies; and various combinations. Although they provide different services, they use similar vocabulary to describe what they do—causing confusion among the customer base. If your company’s only recruiting resource is the local newspaper classifieds, you’ll want the depth and breadth of a recruiting firm’s sources. If your company experiences high turnover, and the skill sets demanded by most jobs are light, a temporary staffing service may be your best option. An employment agency’s services can be misleading because they don’t work for you—they work for the candidate. Make sure you understand what the firm’s primary mission is before taking the time to evaluate their costs.

How do they recruit?

There is no point in paying a fee to a company that does the exact same thing you can do. Recruiting firms make money because the candidates that they locate can’t be found through classified ads. Ask detailed questions about the methods and resources they use to locate top talent. Do they have multiple and creative recruiting sources? How big is their Rolodex? You want a firm that can find the star, not just produce a pile of resumes.

Are you paying a recruiter or a salesperson?

Many recruiting and staffing firms in business today hire salespeople to deliver their services. Firms tend to employ people who can sell a lot of recruiting orders, while de-emphasizing their ability to attract the best candidates.

Look for firms whose people not only have experience, but who demonstrate a level of professional expertise. There are three primary professional designations in our industry: Certified Placement Consultant (CPC), Certified Temporary Staffing Specialist (CTS) and Certified Staffing Professional (CSP). Make sure that your firm employs a person in a leadership position with at least one of these initials.

Do I understand the fees?

Many first-time users of recruiting services are intimidated by the cost structure of a search. Most firms are paid a fixed percentage of the annual salary for the job that they fill. This percentage can vary from 15% to 30% depending on the level of job, but it is contingent on hiring a candidate that they produce. If you don’t like any of their candidates, you don’t pay. Take the extra time to understand how you will be billed and what contractual guarantees the firm will provide to ensure that the employee they recruit will be successful.

Trust is the most important measure
Finally, there is the one factor that defies measurement. Among all of the professional services that your company purchases, recruiting is probably the most touchy-feely.

Like all businesses, recruiting firms have unique cultures that are reflected in the mannerisms and words of their employees. Why is their culture worthy of your attention? Recruiters can only be successful if they have all of the information required to fill the job. That means that you (the client) will have to feel comfortable enough to share the good and bad about your company, your managers and perhaps yourself.

Choosing the men and women who will work successfully in your business is a tough job that is fraught with uncertainty. With the right recruiting partner, you can gain more confidence in your hiring choices.