Negotiating Job Offers with Top Talent

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Executive search is a personal business, and the path to salary negotiation with top talent is a strategic one, with many important steps and considerations along the way. Helbling recruiters believe …

Executive search is a personal business, and the path to salary negotiation with top talent is a strategic one, with many important steps and considerations along the way. Helbling recruiters believe the key to successful negotiations is making sure you have covered all the right questions with prospective candidates before talking dollars and cents.

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  • 1. Construction Real Estate EngineeringFacilities R E T A I N E D E X E C U T I V E S E A R C H Negotiating Job Offers with Top Talent It’s More Than Just Dollars and Cents rom an outside perspective, salary negotiation with a job candidate appears to be a simple process: just find a candidate who has the right skills and offer them slightly more money than they are currently making. This may sound like an oversimplification, but many professionals responsible for hiring think this way. Our search consultants at Helbling & Associates believe that recruiting is a personal business. When partnering on a project as personal as executive search, finding a mutually agreeable solution is not always straightforward. Successful offer negotiation is about far more than salary. Hiring is a strategic process, with a number of stages and crucial variables to consider along the way. Failing to make these considerations or bypassing important steps can result in unsuccessful searches or problematic salary negotiations. This article will address several key factors that come into play when making an offer to a top talent candidate. Before an Offer is Made All the moving pieces of the role itself need to be in alignment before even thinking about dollars and cents. Does the role meet the company’s current needs? Is the scope of the job and opportunity clearly defined? What is the value of this role to the company? Our recruiters consult with our clients throughout the search process (including improving position descriptions, identifying candidates, interview coaching, and negotiating compensation packages), alerting them to all of the critical factors discussed in this article and helping them focus on selling the opportunity to a candidate. And, there is always the undeniable importance of cultural fit. At Helbling, we emphasize this component of every search we have the opportunity to perform. Even if a candidate has the technical ability to perform the functions of a role, if the cultural fit is wrong, the salary doesn’t matter. On the other hand, once the client and candidate determine that they want each other, the compensation arrangement becomes much easier to navigate. Many hiring managers wrongly assume that the strategy ends once a candidate comes in for an interview, and that may impact the way they negotiate salary. Convincing a candidate to walk through the door does not necessarily mean the candidate is sold on the opportunity. It’s important to stay strategic and remain focused on the value of the role and the overall goals of the organization throughout the interviews and negotiation process. By Caroline Drazin, with the assistance of Helbling consultants, Tom Dunn, Marc Datz, Jim Lord, Matt Lesher, Ryan Pugh, and Joe Wargo F All the moving pieces of the role itself need to be in alignment before even thinking about dollars and cents. Does the role meet the company’s current needs? Is the scope of the job and opportunity clearly defined? What is the value of this role to the company?
  • 2. Negotiating Job Offers with Top Talent Spring 2014 Navigator Identifying Key Motivations In a previous article, How to Evaluate a Prospective Hire’s True Motivations & Interests, we discussed the importance of identifying a potential candidate’s key motivations, technical capabilities, career goals and personality in order to assess whether they are the right fit for a company’s culture. This type of intelligence can not only help determine whether a candidate should be considered, but it is also useful to have when structuring an offer. Discovering why a candidate is looking to leave their current employer should be one of the first things to uncover. Many employers ask this directly as part of their standard repertoire of interview questions, but as our previous article notes, this often triggers a rehearsed response that tells little about true motivations. A series of more probing questions may yield a better understanding of what is driving a candidate to make a move. One possible motivation unrelated to salary is quality of life. For example, a candidate currently with a construction or engineering firm may be wooed to an owner organization (such as an institution or public agency) due to the quality of life typically associated with that type of organization, even if the compensation package isn’t quite as attractive. Quality of life can refer to such things as vacation time, opportunity for personal development, working environment, or work-life balance, to name a few. The current state of the economy and job market is another factor that may realign a candidate’s priorities when assessing a job opportunity. When the market is particularly volatile, job seekers may be more focused on guaranteed positions in stable companies than achieving a bump in salary or taking on more responsibility. As the markets shifts, employers must adapt their hiring strategies to those changing conditions. As experience will tell, it’s not always about the money. The Million-Dollar Counter Offer A high-level candidate we recently placed turned down a substantial counter offer due to other aspects about the new position that made it more enticing, such as location, trusted leadership, and opportunity for growth. Again, most serious candidates are not only looking for higher salaries. Still, it’s important to identify the ones who are early on, versus those who are committed to the new role. If compensation is the only motivating factor, a candidate is much more likely to accept a counter offer. Counter offers are a weighty consideration in any negotiation that requires drawing a passive candidate from an existing position. When targeting “top-tier” talent, a counter offer can generally be expected, and hiring managers will want to be prepared for that in advance. When working with our recruiters, clients are given the luxury of knowing what potential candidates are currently earning; part of a recruiter’s responsibility is gathering this kind of information to help clients make tailored offers. However, it’s a misconception that a candidate’s offer should be solely based on what they were previously making (for example, there is no specific percentage raise that is appropriate across the board), and ideal candidates should not be undervalued just because they were underpaid at their last job. An offer should be based on the value of the role and the abilities of the candidate, particularly when a counter offer is likely. Making it Personal A candidate’s spouse can have a huge effect on the success of a hire, whether they are advocating for or against taking the new role. At times, a husband, wife and/or partner can be a client’s best cheerleader if they are on board. During the negotiation process, it’s sometimes helpful to invite the candidate and their spouse to dinner, getting them engaged in the process and helping them buy in. This can increase the spouse’s/partner’s level of comfort with the change and remove the uncertainty associated with a new company. In one instance, a candidate requested that our client join him and his wife for dinner. The experience was critical in demonstrating the company’s personal commitment in the long term, and gave him a higher level of comfort with what was to come. With his spouse’s support, the candidate ultimately accepted. On the other hand, we have seen an offer flatly rejected because the candidate’s spouse decided that, astrologically, the alignment of the planets and stars was unfavorable for making changes at that time. Whether that particular reason was true or false, the influence a husband, wife and/or partner can have on a candidate’s decision can’t be underestimated. Most serious candidates are not only looking for higher salaries. Still, it’s important to identify the ones who are early on, versus those who are committed to the new role. If compensation is the only motivating factor, a candidate is much more likely to accept a counter offer.
  • 3. Read more of Helbling’s perspective articles on A|E|C, Facilities Management, Talent Management, and Career Development by visiting our Knowledge Center. Subscribe to Helbling’s quarterly eNewsletter and New Search Alerts by visiting our home page at www.helblingsearch.com. Social Media: Blog: blog.helblingsearch.com Twitter: @helblingsearch RESPONSIVE Motivation  and  urgency  to  fulfill  your  needs RESOURCEFUL Extensive  network  of  contacts  in  your  industry RELIABLE Comprehensive  and  accurate  market  intelligence RESULTS Performance  that  exceeds  your  expectations RELATIONSHIPS Consulting  based  upon  trust  and  commitment H E L B L I N G & A S S O C I A T E S , I N C . R E T A I N E D E X E C U T I V E S E A R C H w w w . h e l b l i n g s e a r c h . c o mP i t t s b u r g h 7 2 4 . 9 3 5 . 7 5 0 0 Beyond the Base Base salary is only one of many elements that make up an offer. Every candidate is unique, and structuring an attractive compensation package tailored to their individual needs can show a company’s commitment to bringing him/her on board. Depending upon the type of company, there are a variety of creative ways to enhance an offer. For example, a higher education institution may not be able to offer equity to a candidate, but they may be able to offer free tuition to a candidate’s children. Other possible components include guaranteed bonuses, signing bonuses, relocation assistance, or additional vacation time. As noted earlier, getting verification of the full package a candidate is currently receiving can go a long way in helping a company understand how to structure a favorable offer. It’s important for a company to know where there is flexibility and where there isn’t, and to not be afraid to say no. A company may not be able to give candidates everything they ask for, but should know ahead of time where it may be able to concede. Conclusion When preparing to enter negotiation with a candidate, the most basic rule of thumb to remember is to make sure everything is in alignment (including the planets) before putting an offer on the table. Understand what the company is looking for, what the candidate’s parameters are, and what kind of offer it will take to satisfy both parties. Here are just a few questions to ask before making an offer: • What are the candidate’s key motivating factors? Salary, location, family, upward mobility, etc. • Does this candidate have the right cultural fit for this organization? • If relocation is necessary, is the candidate willing, and what will it take to make that happen? • What is the candidate’s full compensation package now? • In terms of compensation, what areas are flexible, and what areas are firm? • Are there other incentives beyond salary that might entice this candidate to accept? Back to the earlier point about staying strategic, the work is still not over once the candidate says yes. It’s crucial to stay engaged after the offer is accepted. Both the client and the search consultant should stay connected throughout the onboarding process. Encourage other team members to reach out and make contact, congratulating the new hire and making them feel welcome. Negotiating Job Offers with Top Talent Spring 2014 Navigator Caroline Drazin is Marketing Coordinator with Helbling & Associates. She works closely with our search consultants in developing articles and blogs about talent management, career development and executive search. She may be reached at carolined@helblingsearch.com.