Counter Offer Pitfalls
When one of your best employees walks into your office and gives you a resignation notice, perhaps to pursue an opportunity with another firm or start their own company, you may be tempted to make a counter offer persuading that person to stay. Just like no one likes to be fired, the employer feels like an employee cannot just quit working for them.
There’re a few other reasons why the employer would try to make things right, including:
- The feeling that the timing is poor
- The feeling that losing a strong employee in the company could cause others to lose morale
- Too many people have already left and any more openings would paralyse the business
- Losing another employee would reflect poorly on their direct superiors
- You wouldn’t feel comfortable losing the current employee until a suitable replacement is found
When someone quits, it is commonly perceived as a reflection on their boss. And unless the employee is incompetent or too inexperienced, the boss will look likely look bad by allowing a trained and experienced person to leave. Naturally, the employer’s reaction is to do whatever it takes to keep the employee from leaving, or at least until there’s a suitable replacement.
However, the counter offer is not always what people believe it to be.
Unless the employee is known for making rushed decisions without considering the implications until later (or even not at all), he/she has probably weighed the pros and cons of making a change from your organisation before approaching their higher ups. Alternatively, if that employer is known for making hasty decisions, it could be a healthy change to see them leave your team.
Before jumping into a counter offer, consider these three crucial elements:
- Counter offers don’t give you as much time as you think
A survey by The National Business Employment Weekly revealed that nearly 80 percent of people who accept counter offers still leave their organization within the year. Once an employee has made the decision to leave, it’s often engraved in their psyche, making them less motivated to put effort into their workweeks. Staffing them temporarily until they pull the trigger on leaving again will contribute little to your company’s productivity, and will take up unnecessary bandwidth in your payroll.
- Money’s not everything
Many studies suggest that money is, surprisingly, not even among the top three reasons why people make career changes. Yet it is the main element of a counter offer.
- The relationship has already changed
Even though you might get the person to stay, you can never regain the level of trust that was there before. You will be waiting for the employee to be dissatisfied again, or to find an even better deal than the previous one. The employee might even corrupt the motivation of other employees and destroy their morale.
Keep in mind that once someone is unhappy or shows interest in moving to a different organization, your relationship has already changed and persuading them to stay might produce mixed or short-term results, at best. Instead of trying to hold onto an employee who has shown interest in moving on, put your company efforts towards finding a new candidate who will be successful in the role, and who will maintain longevity with your company.
Contact the team at The Executive Wing today for more information.