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Having to deal with counter offers is one of the most difficult\u00a0challenges facing successful\u00a0companies looking to grow and attract great talent.<\/p>\n
Great employees are hard to find, highly sought after and almost always gainfully employed. No employer wants to lose people like this without a fight, so\u00a0when an employer learns that one of the their best employees is intending to resign, in all probability there\u00a0is going to be a strong effort to prevent them from going.<\/p>\n
In our business, which is based entirely\u00a0on finding elite level sales people,\u00a0counter offers\u00a0arise regularly. Over the years, however, we\u00a0have developed useful ways of mitigating their impact on our ability to recruit the people our customers need to hire. Some of these tactics can be used in isolation, or combined to increase the chances of landing the desired candidate:<\/p>\n
The best defense against counter offers is to offer things that no other employer can offer. Market leaders\u00a0explicitly understand\u00a0that becoming known as a great place to work and build a career significantly lessens the impact that a counter offer has on a highly desirable candidate.\u00a0Any employer can offer more\u00a0compensation, but a company that is known as an employer of choice can offer\u00a0not only a great financial opportunity, but also a great career opportunity \u2013 which is always very\u00a0difficult\u00a0for\u00a0other\u00a0employers to\u00a0match.<\/p>\n
When someone decides to interview for a new position, they are likely seeking something they are not receiving from\u00a0their current employer. The recruiting employer has the advantage\u00a0of discussing these matters with the prospective hire and offering\u00a0a career opportunity that caters to\u00a0the candidate\u2019s current objectives, needs, and mindset. When a mutually agreeable offer is made and the candidate informs their current employer that they will be\u00a0resigning, the current employer may well be caught off guard and not be\u00a0able to offer all the things that the competing\u00a0employer is offering. This makes it imperative to not only fully understand the candidate\u2019s real career objectives and motivations for making a change, but also to stay in very close contact throughout the recruiting process so as to be aware of any issues or mood changes as they\u00a0arise.<\/p>\n
During advanced stages of engaging a target candidate, have a discussion about the likelihood that they will receive a counter offer from their current employer. Ask the candidate whether they expect a counter, how they will feel about this and how they will respond. Consider conducting\u00a0a role play where you present a counter offer to the candidate to assess the degree to which they have thought through their response, and how emotionally committed they are to leaving their current employer. At worst, this will help identify any addressed obstacles that may stand in the way of hiring this person away from their current job.<\/p>\n
I recall the negotiations with one particular\u00a0highly coveted candidate. We met the candidate\u2019s financial requirements, and\u00a0although money is always a factor in making career moves, the candidate had\u00a0expressed that their primary motivation for making the change was to take advantage of the career opportunity that was being offered.\u00a0They claimed that no amount of money would make them pass up this opportunity. To see where we were really at, I role played a resignation conversation between\u00a0the candidate and their current employer, with me assuming the part of the latter. It went something like this:<\/p>\n
\nCandidate<\/span>: I would like to inform you that I am resigning.<\/p>\n
Me\/Current Employer<\/span>: I am sorry to hear that. Is your decision final?<\/p>\n
Candidate<\/span>: \u2026Yes<\/p>\n
Me\/Current Employer<\/span>: Can you tell me why are leaving?<\/p>\n
Candidate<\/span>: I feel it is time for me to move on.<\/p>\n
Me\/Current Employer<\/span>: Is there anything I can do to make you change your mind?<\/p>\n
Candidate<\/span>: I am sorry, not really.<\/p>\n
Me\/Current Employer<\/span>: If I raise your base salary by $20k and add a new 10% bonus, would you be open to reconsidering?<\/p>\n
Candidate<\/span>: Uh\u2026wow\u2026well\u2026uh\u2026yes.<\/p>\n<\/blockquote>\n
Boom! I knew right there we had not yet fully secured the candidate\u2019s commitment to make a move and more work was required to understand\u00a0the candidate\u2019s real motivations.<\/p>\n
Get Compensation Right<\/strong><\/h2>\n
While there is a school of thought that money is not the most important aspect in attracting great talent, we see time and time again that even small differences in compensation have an enormous impact on a candidate\u2019s desire to change employers.<\/p>\n
Yet\u00a0a\u00a0surprising number of companies will spend a lot of time finding and courting\u00a0the ideal candidate, discussing a financial offer and then making\u00a0a formal\u00a0offer which includes\u00a0compensation that is lower than the candidate is currently\u00a0making. Hiring employers that make these kinds of offers either overvalue the career opportunity that they are offering or assume that a candidate will want to negotiate.\u00a0Big mistake. In many such cases,\u00a0the candidate, having been insulted by the recruiting employer,\u00a0will\u00a0go back\u00a0back to their current employer, let them know they are contemplating resignation, and ask for a raise in exchange for staying. Many employers will comply and the candidate is off the market.<\/p>\n
\neven small differences in compensation have an enormous impact on a candidate\u2019s desire to change employers.\u201d<\/p>\n<\/blockquote>\n
An approach with a better chance of success\u00a0involves\u00a0knowing what a targeted\u00a0candidate wants, and making a great first offer that meets or even exceeds their expectations. This takes compensation off the table as a potential issue in the offer negotiation and allows the discussion to focus on other aspects of the unique\u00a0career opportunity that is being offered. It also doesn\u2019t hurt to have some\u00a0budget flexibility in order to sweeten\u00a0the compensation\u00a0offer\u00a0if required to close the right candidate.<\/p>\n
Out Counter the Counter<\/strong><\/h2>\n
At some point later in the process of courting a particular candidate, \u00a0have a discussion with them about the likelihood\u00a0that they will get counter offer from their current employer. Be upfront and inform the candidate\u00a0that you\u00a0would like a chance to speak\u00a0after the counter is received in case there is chance to make a better offer. While an employer\u00a0generally wants to avoid a bidding war for talent, there is no escaping the reality that by\u00a0targeting the best talent in the industry, you are already in a bidding war.<\/p>\n
De-risk<\/strong><\/h2>\n
Anyone that leaves an employment position to join another company is assuming risk. This is particularly true with high achieving people who have an unblemished\u00a0track record of success. Recruiting employers often underestimate this risk and the power of the status quo. Even if a great career opportunity is presented to a potential hire, they may be inclined to pass on the opportunity and accept a counter offer in order to stay with their current employer since they have a reasonable likelihood of continuing their success. \u00a0This reality makes it incumbent on the recruiting employer to thoroughly map out how the candidate\u00a0will be successful and how every detail has been taken care of including contingencies for unexpected events.<\/p>\n
To your success!<\/p>\n
Photo Credit: JD Hancock<\/a> via Compfight<\/a> cc<\/a><\/span><\/p>\n
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