As Search consultants, we know all too well the frustration and disappointment that comes in the form a great candidate, with whom our Client has fallen in love, accepting a counter-offer...
In recent months we’ve seen several instances of counter-offers influencing the outcome of a recruitment process.
How best to handle a counteroffer?
Well, from a Headhunter’s perspective, our aim is to prevent the serious consideration of a counter-offer - and the answer may lie in a very thorough interview process.
We strive to make sure that candidates we’ve approached, and who are interested in a career move, have given it some thought, have weighed the pros and cons and have come to a decision based on their consideration, not a spur-of-the-moment impulse.
But with all the preparation and thoroughness, we can still never rule out the possibility of a candidate getting and accepting a counter-offer. It is human nature and we are in the business of humans!
And from a candidate viewpoint:
If you are unhappy with your current position/employer for whatever reason and are exploring your options, you should be prepared for the possibility of getting a counter-offer at the end of the process (although some employers do have a policy of making no counter-offers at all!).
Most typical reasons for a company to make a counter-offer is to retain valuable knowledge and to avoid the cost and efforts of replacing you. So let that sink in. Yes, there are some cases when accepting your employer’s counter-offer is the right move, but generally speaking, an increase in salary isn’t a magic wand - in fact with such an offer should come the realization that your employer has all but admitted that you are worth more to them than they have been paying you.
Interestingly, research published in Harvard Business Review suggests 50% of people who take a counter-offer end up leaving the firm within the next year anyway.
And what about Clients?
Having an ideal candidate reject your offer only to accept a counter-offer with their existing employer can be a bitter pill to swallow. After all, you put in the effort, met with the candidate, answered their questions, etc. but apparently, it was not to be.
Well, that may be the best outcome, given that the candidate was not motivated enough to join your company. It’s possible that a pay increase was the objective all along for the candidate, or when the candidate hands in her notice, she is genuinely surprised at the steps current employer is willing to take to keep her on board.
Sit down with your Search Consultants to examine the outcome, make adjustments if necessary (is it this one candidate? Have we been turned down before due to a counter-offer? Is our salary competitive? Should we avoid the competitor where we are targeting? And move on.
Veronika Mohasci
Senior Consultant, Budapest
Progressive organisations and their leaders are now realizing that the hackneyed excuse of “there just is no qualified diverse talent” is an outdated phrase from before the pandemic.
The question of who will be returning to the physical office and who will remain virtual is a burning issue. In 2020/2021 many organizations operated in a virtual, or hybrid, workplace and there is no doubt that this has influenced how they view their current talent, how they deploy that talent and from where they now look to acquire talent.
We recognise that leaders are becoming more open to looking at how the work gets done irrespective of a specific physical location.
Women and people of colour who might have felt like outsiders in a white male-dominated in-person workforce might find working in a hybrid or purely virtual workplace an attractive way to gain career experience. Talented people who are differently-abled can now become entrants into a job market that was once physically closed to them when all work was done in-person. These are exciting options for everyone.
Long commutes to an office may have dissuaded people from working for a particular company. By casting a wider net for talent to fit new hybrid workplaces means roles can be much more attractive if newly hired talent only had to go into the office two days a week — or even one week a month.
The world has changed.
The workplace has changed.
We have all changed.
Friisberg works with organisations all over the world to help them keep pace with rapid progress and ensure they secure the very best talent.
Lorri Lowe,
Partner UK
VUCA: Volatility, Uncertainty, Complexity and Ambiguity – an acronym used in 1987 to describe the unpredictability after end of the Cold War and is increasingly used to describe the unpredictable nature of the world today.
Not only has Industry 4.0 rapidly changed the business environment (artificial intelligence, nanotechnology, robotics, biotechnology, the Internet of Things, autonomous vehicles, etc.), but it also influences various aspects of our lives; from politics, terrorist attacks or natural disasters, and catastrophes such as COVID-19. We can hardly anticipate what new business realities will face our future leaders.
What kind of leadership will be most effective in VUCA reality?
Facing more and more uncertainly, leaders must be open to change, flexible to deal with ambiguity, creative, fast learners and risk-takers. There is of course one constant element in the VUCA world: PEOPLE.
Leaders must support their team by remaining focused, fast and flexible. Leaders should coach their employees by enhancing their skills in two of the most significant areas: agility and complex thinking. According to the UNC Kenan-Flagler Business School, HR should create leadership development plans on the assumptions based on:
Volatility can be countered with vision, because vision is even more vital in turbulent times. Leaders with a clear vision of where they want their organizations to be in three to five years can better weather volatile environmental changes such as economic downturns or new competition in their markets, for example, by making business decisions to counter the turbulence while keeping the organization’s vision in mind.
Uncertainty can be countered with understanding, the ability of a leader to slow down, look, and listen. To be effective in a VUCA environment, leaders must learn to look and listen beyond their functional areas of expertise in order to make sense of the volatility and to lead with vision. This requires communication with all levels of employees in their organization, development and demonstration of effective teamwork and collaboration skills.
Complexity can be countered with clarity, the deliberative process to make sense of the chaos. In a VUCA world, chaos comes swift and hard. Leaders, who can quickly and clearly tune into all of the minute associated with the chaos, can make better and more informed business decisions.
Finally, ambiguity can be countered with agility, the ability to communicate across the organization and to act quickly to apply solutions (Kinsinger and Walch, 2012). Vision, understanding, clarity, and agility are not mutually exclusive in the VUCA prime. Rather, they are intertwined elements that help managers become stronger VUCA leaders.
In the Harvard Business Review article, The Most Important Leadership Competencies, According to Leaders Around the World, researcher Sunnie Giles shared the results of “the first round of a study of 195 leaders in 15 countries over 30 global organizations.” In the study, “participants were asked to choose the 15 most important leadership competencies from a list of 74.”
The top 10 competencies were then grouped into 5 themes:
On the top of the uncertainty of the business environment, we have overlap of generational exchange. Contrarily to Millennials, who tend to expect quick success and have less propensity to stay put as they grow up in an age of endless options, the Z generation is even more tech-savvy and high expectation seekers, but they search for job security.
Tomorrow’s leaders need to build trust with their teams. Trust will continue to be the currency of the workplace. Being able to create a safe place for their teams will help Millennial leaders’ priorities to build a culture that appreciates both people and results.
Today’s market environment stresses speed, flexibility, and the ability to lead in uncertain situations.
Tomorrow demands high ethical standards, encouraging openness and great communication skills to managing firms successfully.
Dorota Serwinska, Partner
Anna Rudzinska, Partner
Poland
You have been responsible for international business development for years. What do you enjoy most about this role?
Diversity. Diversity, in terms of colleagues, cultures, projects and the international scene where we service our Clients. It delivers new challenges on a daily basis that I need to solve rather fast. Besides my work as a consultant on the Hungarian market, my international business development role makes it more complex providing me with a lot of new information, insights of international trends and involvement with how our Partners handle projects in various countries. It is just fun!
The concept of thinking globally is now more widespread. Why do you think Friisberg is so successful working globally and on cross border assignments?
Quite simply, Friisberg can be very responsive to the markets. Our flexible methodologies mean some of our offices actually exhibited massive growth during 2020, which is simply admirable. Even before the pandemic we positioned Friisberg not only as a trusted search firm, but also a management consultancy firm, delivering solutions for business leaders in management audit, board services, network science-based organisational development and business partner search.
What qualities do you think are required to facilitate effective international business development?
You must love it and you must be dedicated to it. Having inspiring people around you whether that is your colleagues, clients or candidates, helps and we must all listen to each other carefully. Openness is very important in such a role.
How do you use technology? Do you use business intelligence tools or systems and what steps you do take to analyse trends and identify new opportunities?
Throughout Friisberg we use various cloud based platforms for our business administration, but most importantly our Friisberg Network Advisory (FNA), which is a network science-based organisational development tool supported by AI, reveals the social network of the company and provides the opportunity to visualize and thus analyse and manage the relationship of business units and individuals. This is much loved by our clients too!
Where do you see Friisberg in 5 years’ time?
Friisberg is a growing organisation so my role is increasingly interesting. We are opening new offices in new cities and new countries and we plan to expand even more in the coming years. The future is very bright for Friisberg!
Zoltan Petho
Partner, Hungary
With such economic volatility and uncertainty currently, oversight by boards is more important now than ever.
A balanced view is critical to the success of a company, and maybe even its survival. However, boards may whether wilfully or unwittingly converge on collegial consensus and by doing so fail to address crucial issues. Independence from each other and thereby better collective decision-making are interconnected prizes that are hard fought but well worth winning.
In 2015, Siobhan Sweeney’s “The creation of the Contrarian Director and their role in achieving workable board independence and better risk oversight” caused something of a stir. The premise of that paper is as pertinent now as it was then, and in the aftermath of Coivd-19 perhaps even more so. Having a ‘Contrarian Director’ - a devil’s advocate - on a board to question the herd instinct, to investigate alternatives and recommend innovative approaches whilst acting independently and impartially will deliver more robust examinations of facts, options and proposals.
The longstanding and arguably inevitable consequence of capitalism is that the untried, untested, unknowns are avoided in favour of their more familiar counterparts. The composition of a board of directors will often follow the same trajectory, with reinforcement of success in the form of making another appointment not too dissimilar to the last. The case for independent thinking, and diversity of background (gender, ethnicity, education, experience) has not been made in sufficient boardrooms - all too many boards continue to miss opportunities in the appointment process leading to a reinforcement of an established culture.
Groupthink and confirmation bias in a board room are dangerous and difficult to root out. They can easily override the most rigorous of decision-making processes and detract from even the most respected expert opinion. Self-awareness is the key to reversing such a slide.
Chairs, and other NEDs should recognise when:
Consciously or subconsciously Chairs may prefer directors who will help them build a consensus. The concept of the contrarian runs counter to that – and deliberately so – so it will take a strong Chair (and CEO too) to actively seek out and secure someone to the board who can and will challenge them, routinely, but professionally of course.
Once the benefits of more varied thinking in the boardroom become apparent, then the same principles extended to senior management and throughout a company might yield yet more advantages for that company.
But… do please feel free to disagree with me!
Andrew Guy
Partner, UK
