Should I stay or should I go?

We have noticed during the course of recent executive level searches that there is an increasing imbalance of expectations or misalignment between employee and employer when it comes to resolving a satisfactory offer. We have witnessed many instances where there is a widening gap between the expectations of candidate and employer when issues arise around the structure of the compensation offer.

This is a fundamental problem which needs addressing. Here we set about highlighting some of the reasons that cause these issues and recommend some ways to resolve the problem.

Should I stay or should I go? This is the most frequently asked question to Executive Search consultants by the successful candidate on receipt of an offer. It is the time that all the doubts, concerns and fears come to the fore in their mind now that the selection process has finished. Whilst in the past, the majority of new hires would be open and disposed to accept an offer, 'today's' hires are much more cautious and risk averse.

Why has there been such a shift in thinking and approach?

Conversely in recent times, almost as a mirror to the changing mindset of potential new employees the employer's position has also shifted.

Why has the close of the hiring process become much harder?

Why at a time when the employer and employee are about to embark on an important partnership does this relationship become fraught?

The Candidate's Story

It is apparent that employees have become much more circumspect in their decision making. Many involved in the hiring chain presume that a candidate's acceptance is a formality...

Why would they go through the selection process in the first place if they were not going accept?

So why have candidate's changed their outlook? What are the drivers which that present them with so much angst?

  • The 'time in the bank' factor - Individuals are more aware that moving to a new organisation means that the value/security gained from the time invested in their current organisation has to be offset against the risk/reward of a new organisation
  • The 'head hunter' factor - candidates who are approached through search are not actively looking for a new role and therefore always seek an improved compensation package as a motivation to move to a new role
  • Last Minute thinking - many candidates do not seriously consider the wider implications of a move including financial, location and career until they receive an offer
  • Risk and Reward - candidates fail to accept that changing job requires them to understand that there are risks offset by reward which will mature over the medium and long term rather than over the short term
  • Unrealistic Expectations - many candidates build unrealistic expectations when it comes to salary, bonus and other work related costs such as travel
  • Retention policy - many organisations have developed coherent and effective retention strategies
  • Economic Uncertainty -the current state of the global economy is having a dramatic impact on decision making
  • Brand and Appeal - candidates are far more intuitive and aware of the impact of the brand of an organisation and are able to establish a view of the brand and its competitive position easily via the many knowledge sources now available

The Employer's Story

So what has made the employer more circumspect?

  • Risk Averse mindset, we are in a 'glass half full' market which adds a sobriety to business thinking, which is in contrast to the mindset of an organisation in a growth economy
  • Investment restraints which act as a barrier to flexibility in the compensation award
  • Economic Influences suppress the organisation's ability/willingness to build comprehensive offers such as 'signing on bonuses', guaranteed compensation levels and high bonus levels
  • The 'buyers market' perception - many organisations feel less inclined toward flexibility due to the soft demand in the hiring market which create difficult internal barriers to largesse such as bonus inducements, share options and inflation 'busting' salaries
  • 'Take it or leave it' - certain organisations are unwilling to consider that they have to 'sell' their organisation/role and that they have to build confidence in the candidate to enable the move

It is clear that there are many factors which are having an impact on the hiring process. Rather than acting as a unifying influence these issues are having a divisive impact. The impact of a downturn is that both parties are more risk aware; a condition which moves both parties further apart in negotiations.

Taking this into account how then can we, as Executive Search consultants, make this process become more effective and positive?

  • There should be clear and open communication ideally facilitated by the search consultant who acts as a dispassionate advisor
  • Openness should be primary, all cards should be on the table
  • Commercial realism bounded by an acceptance of the cost of failure to both parties
  • Communication - the benefits of direct talks should not be underestimated

It is important that in these demanding times both parties in the recruitment process need to adopt these points as they will have a very positive impact on the process. The danger presented by the current misalignment between candidate and employer is one that should not be underestimated and can lead to a costly failure to recruit.