Anatomy of the Counter Offer – What the Employee Hears…

Some anatomy books

A top candidate of mine just had “the talk” with his boss. He put in his notice, and the response was so very predictable. The boss offered apologies, promised raises and talked about new roles to keep him, but the candidate politely declined and finalized his start date…just the way we had prepped him.

Counter offers have been used by Google, defended by top HR pro Lance Haun and lampooned in Forbes, so I won’t talk here about whether they are effective or not. I can, however, confidently state that the notice conversation, the point where a valued employee tells the manager he/she is leaving, is typically so poorly handled that it comes across as pathetic, lame and predictable.

It all sounds plausible, and in fact, sometimes it’s even genuine. The problem, of course, is that the talk comes too late, so it feels fake. Here is a typical manager response when a top performer tells him she is leaving:

Wow, Sally…that really catches me by surprise. Look, you’re way too valuable to us to have you leave. You have to know that, right? I mean, we’ve been really busy, so maybe I have not given you the right recognition or been able to bring you up to speed on the conversations we had last month at the leadership retreat. You’re very important to us. We had even talked about expanding your role. You’re that important.

And me, I’m probably moving up in the next 6-12 months, and you’re the lady on the succession plan. Let me talk to the CEO and get you some time on her calendar next week, when she gets back from Asia. I know we can accelerate the raise we had already planned for you, plus another bump when you get promoted into my role. Just hang in there, Sally. Things are right around the corner. Big things. Don’t make any firm decisions yet.

It comes across as so fake, in fact, that this is what the candidate actually hears from the manager:

  • Initial surprise—I have been paying absolutely zero attention to you recently as you have completely disengaged from your work.
  • The big secret plan—we either had a plan and failed to act on it, or more likely, never ever had a plan for your development.
  • We can expand your role now—we have a group of unwanted, barely productive, high maintenance employees who no one else wants to manage. They’re yours.
  • More money, right now—we would rather pay you what we should have been paying you rather than start a search. We will absolutely throw money at this problem.
  • The big move…later—if we increase market share 67%, cut costs, and our four biggest competitors catch on fire, you’re in. Just not right away.
  • Don’t make any firm decisions—even though you have worked tirelessly for me for years, I am asking you to delay your shot at greatness until someone else comes up with a plan to keep you.

I am exaggerating a little, but I have used stories like this to tip off candidates ahead of time. Humor helps make the point. That way, they should be able to examine the counter conversations with an impartial eye. If you can prepare them for typical counter topics, maybe they can take the emotion out of the game to understand what’s real and what’s nonsense.

FOT Background Check

RJ Morris
R. J. Morris is a talent acquisition/staffing director based out of STL with McCarthy Building Companies, a multi-billion dollar national firm. Like many others in the FOT clan, he's a sports nut who can endlessly draw the parallels between athletes, sports and the talent management game. I know, I know, as if we needed more of that.  He has 7 years of practitioner experience leading talent acquisition efforts in corporate HR and another 7 years in leadership roles on the agency side, so he gets both sides of the desk.  Talk to R.J. via emailLinkedInTwitter...

15 Comments

  1. Anonymous says:

    One of my valued co-workers just left our organization for some very green pastures. I don’t know what kind of counter-offer was made, but I know the company couldn’t (wouldn’t) match what he’s getting elsewhere.
    I’ve heard people say, “What was the company to do? They couldn’t match that.” But that’s not the problem. The problem was for the last two years, they’ve shafted him pretty good on his raises. They could have kept him around with some modest raises.
    The company can make whatever excuses they want, but when you have employees fresh out of school, five years is a long time to avoid recognizing them. Five years is a long time for them to build up skills and project management experience without realizing (or caring) that they’re worth more on the open market.

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  2. Counter offers are a widely used tool that delay the inevitable. Don’t get me wrong, I have used them in the past but I also recognize that the highly valued employee that is leaving for another opportunity may have some very legit reasons for doing so.
    I have coached countless candidates on counteroffers and encouraged my recruiting teams to do the same. As RJ very wisely points out, tip your candidates off before hand – they will likely encounter some version of the counter offer. If they accept the counter offer, they will likely be looking again in the next few months because they just put a band aid on a problem that requires something more dramatic (like surgery).

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  3. R. J. Morris says:

    @Michael—Thank you for the comment. As Lance points out, “every situation and employee is different. And that’s why you need to analyze each departure.” I do agree with you, though, that many counters are ineffective, often because they are delivered so poorly.

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  4. HRBR says:

    I remember one counter offer–was temping and received a full-time offer. I like the company I was temping for and enjoyed the work, pay was OK, but no benes, etc.
    I give them notice and their counter offer was “tell us what it would take to keep you”–wow, now, suddenly I was good enough to maybe offer full-time employment, etc, but I was going to have to figure it out for them. It didn’t work. No regrets. If they had made me an offer–it might have worked.
    To top it off, they even ended up using scare tactics of a sort when I said I thought it over and was still moving on. They said if you get out of this field now to go back to your old field of work, it will be hard to come back to this type of work later on. Well, that turned out not to be true either. I’m in that field they said I wouldn’t be able to return to…
    Interesting post. Thanks.

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  5. Last job I quit actually handled it well. After my little speech about I was handing in my notice the response was “is this a negotiation or final?”. At least we got to that part really quickly and they did not have to bother praising me as I was not interested.
    We parted with no ill feelings.

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  6. James says:

    It seems funny. When i lose a candidate to a counter-offer, those are the rarest but the most shocking. Everyone single one gets 1.) a raise 2.) a promise of a promotion.
    If i followed up with those people 6 months later i bet that “promise” was empty

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  7. Rob says:

    I’ve never understood people who take counter-offers. The underlying issues that led them to look for something else are still going to exist regardless of money or a promotion.

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  8. DarrylRMSG says:

    Janet Jackson’s “What have done for me lately?” would be appropriate background music while reading this post.

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  9. Lance Haun says:

    Since I was called out, I figured I should respond. Recruiters always lose it when someone says it is okay to do a counter offer and they can be successful. I don’t know why, either. Thanks for not being one of those guys R.J.
    Here’s what many recruiters miss because they only see the TA side: employees don’t communicate their desires very well 100% of the time. Shocking, I know. But recruiters assume the company the employee is leaving is ALWAYS in the wrong whereas it is very often a bit more complicated than that.
    I wish recruiters would talk about the dozens of former employees I’ve talked to who took jobs that they later regretted because a company oversold them or a recruiter scared them away from a perfectly reasonable counter because it “never works.”
    Thanks for the coaching, folks. All I ask is the job they go into doesn’t suck so they aren’t asking me down the line, “Why didn’t you do more to stop me? This place is awful.”

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  10. Brian says:

    I’m in a position where there’s a lot of demand, and I get regular feelers from headhunters. I like my job, but they tend to pay below market rate unless someone forces the issue on them.
    If a recruiter comes by with something really interesting, I take a look – I’m happy at this job, but what if I could be thrilled and make more money? I’ve never pursued an offer that I wasn’t genuinely interested in, so I don’t feel I’m being unethical or unfair to anyone.
    Looking around gets me a sense of my market value and a chance to see that my current job is really the best one for me. It also leads to counter offers, and as a result I’m making probably 10-15% more than I would be if I didn’t shop around. I don’t jump ship 3 months later; I continue on as a happy and highly productive employee.
    When recruiters council employees on the dangers of accepting a counter-offer, it always rings hollow to me. It sounds more like the headhunter is more worried about losing a placement fee than anything having to do with the employee (whether or not that’s the case). It’s like listening to a real estate broker saying that now is the time to buy.

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  11. Robert_hatta says:

    Preparing a new hire/candidate for dealing with the counter-offer is an often overlooked part of the recruiting process. Your tips/stories are great.
    The lesson to employers is obvious. As Suster puts it, don’t roll out the red carpet on the way out. http://www.bothsidesofthetable.com/2009/11/16/dont-roll-out-the-red-carpet-on-the-way-out-the-door/. Netflix has a similar policy on the matter. An employee walks in your office today saying that they received a better offer from another company… if you would offer them more money to stay (or some other benefit), do it now. If you would not fight for them, fire them now.

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  12. When recruiters council employees on the dangers of accepting a counter-offer, it always rings hollow to me. It sounds more like the headhunter is more worried about losing a placement fee than anything having to do with the employee (whether or not that’s the case). It’s like listening to a real estate broker saying that now is the time to buy.

    Reply
  13. Diana Martz says:

    In terms of the last comment, I can see how someone may be skeptical about heeding advice of recruiters when it comes to advice about counter-offers, but what’s said in this article is true.
    If you tell your employer you are leaving, and then decide to say, it puts a bulls-eye on your back. There will always be a question mark in your bosses’ minds about your decision to leave. And for the candidate who accepts the counter-offer, their primary motivations for leaving usually come back to light fairly quickly. It’s almost always a temporary solution to a bigger problem.

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  14. Hannah Voss says:

    I enjoyed reading this blog. I read another recently from the employees perspective, rather than the employer, which I also thought was very insightful. It can be found using this link: http://www.truenorth-us.com/blog-and-news/job-tips/155-employer-counter-offers Both have helped me understand how to effectively handle situations that occur when counter-offers come into play!

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  15. The English Bulldog -As the title implies, this breed is native to England.

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