Archive for the ‘Hiring Market’ Category

Age Discrimination — Not Part of a Sustainable Growth Strategy

March 31, 2015

Age discrimination is alive and well. There. I said it. Believe it or not, there is a law against this sort of practice. Yet, by and large, it goes undetected and unenforced. It reminds me of that FCC law that went into effect several years ago, prohibiting TV programs from broadcasting commercials at a louder volume than the program itself. A lot of good that did. I’m finding myself doing what my grandpa did when I was a kid – mute the commercials.

I wish I could mute the hiring executives who insist on hiring sales reps or marketing managers younger than 40. What’s the matter with prospective employees who are 40 or older? Is 40 when the warranty expires? Is it akin to pro football or baseball, in which many players over 30 are deemed high-risk damaged goods?

Let’s step back and look at some of the misguided reasons why hiring companies continue to engage in age discrimination.

  1. Concerns over cultural fit — I was told that the average age at my software company client’s headquarters is 29. Well, of course, we all know that it’s impossible for a 48-year-old to fit in, thrive, and interact constructively amongst younger peers. Unbelievable! Every sales organization I’ve ever managed included a healthy mix of twenty-somethings, thirty-somethings, forty-somethings, fifty-somethings, and some with sixty-somethings. Not only did they all manage to play nice in the sandbox together, but they all brought to the table a fresh blend of perspectives, insight and recommendations. And yes, they all performed equally well.
  1. Concerns of being overqualified – Oh no, we don’t dare hire people with rich experience and wisdom! This concern is usually code for, “Your 50-year-old candidate may be highly qualified for the role, but he’s bound not to be coachable and will likely bring plenty of baggage, including all his nasty habits ingrained over the years.” It seems as though these hiring executives prefer a subservient, moldable ball of clay over a fine wine. The other reason for this concern stems from hiring executives’ belief that no one in their 40s or 50s would really want to pursue the position and stay in it. Funny thing, though – most 40- and 50-year-old candidates have demonstrated more longevity and loyalty in the roles they’ve taken than their millennial counterparts ever will.
  1. Prefer a high-energy up-and-comer athlete over someone on the downslope of their career – Because as we all know, older professionals are devoid of energy, drive, enthusiasm, and the ability to perform. What are we talking about here…ED? Do we really need to invent Viagra for Salespeople? Well, guess what – the person on the “downslope of their career” has just as much to prove (and gain) as the proverbial up-and-comer.
  1. Older candidates inherently have greater demands both inside (i.e., higher compensation) and outside of the workplace (e.g., caring for an elderly parent as well as kids). Well, actually, we all have demands that pull us in conflicting directions at any given time. That’s life. As for compensation, perhaps older candidates are at a different place in their life. Maybe their kids are done with college and the mortgage has since been paid off. That doesn’t preclude them from wanting to make as much money as possible, but it could mean that their priorities have shifted a bit — more interested in the role, company or industry instead of just focusing on the base and OTE. Last time I checked, this can be a good thing.
  1. Older candidates don’t bring the same level of career focus – In other words, because professionals who have been around the block have ostensibly accumulated a greater breadth of roles or permutations of the role in question, they are deemed less desirable. Granted, some “seasoned” candidates bring this upon themselves by emphasizing how they’ve done this, that, and everything else…for over 20 years. They’re trying to be all things to all people. Yet, hiring managers are equally prone to dinging candidates for keeping to the same kind of role throughout their career. They would be viewed as complacent — not seeking advancement or developing themselves beyond their comfort zone.

The current demographic shift in the U.S. population is quite dramatic. As baby-boomers hit their 50s and 60s, there aren’t as many qualified candidates in the more recent generations to continue fueling the hiring and growth objectives that employers seek to attain. That’s not to say that there aren’t viable candidates in their 20s or 30s. Oh, they’re around, all right. But in this highly candidate-driven talent market, they’ve become a hyper prized and increasingly expensive commodity. They’re expensive in two ways. First, all this attention to younger candidates has driven up their comp levels, in some cases to egregious levels not commensurate with skills, experience, or performance track record. They’re also expensive because as hiring companies hold out for that perfect up-and-comer, there’s an opportunity cost for taking four months to fill the role instead of just one.

Companies whose aim is to build their organizations with younger, mirror-image people of the same ilk are bound to compromise the sustainability of their growth plans. Not only will it take longer achieve their goals, putting them behind on their hiring objectives, but they will end up with homogenous groups of people who could never learn as much from one another as they could from a more diverse grouping of experience and skill sets. Yes, age discrimination is alive and well. Yet, it is the very companies that continue to practice age discrimination that end up suffering as much, if not more than those they discriminate against.

 

Action items:

  1. It’s the same 50- or 60-year-old C-level executives, who would be (justifiably) appalled to be discriminated against for their age, who are leading organizations that routinely engage in discriminatory hiring practices. Stop the hypocrisy!
  1. If you will not hire an older person because of concerns over the cultural fit, then it’s high time to reassess your culture.
  1. Attention older candidates: You’re not doing yourself any favors by using terms such as “seasoned” or “25 years’ experience.” In addition, you may have taken on a wide variety of roles throughout your career, but don’t forget to tailor the resume and your speaking points in an interview to the position you are vying for.
  1. “And in the end, it’s not the years in your life that count. It’s the life in your years.” – Abraham Lincoln
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Work it Like You’re in a Contract Year

January 14, 2015

Imagine for a moment that you’re a professional sports athlete. You’ve been paying your dues via extra hours of practice to raise your game and waiting your turn for a chance to prove your value. You’ve put in the sweat equity and made the most of the opportunity for the past several years. Finally, your big payday is on the horizon. You’re in a contract year and at the end of the season, you’ll be a free agent. Multiple teams will be knocking down the door to your agent, bidding up the package to include performance kickers and a host of tantalizing benefits. As long as you have a solid year with impressive stats, your ship is about to come in.

So we’re not professional sports athletes, paid mammoth sums of money to play a game – millions if we win and millions if we lose. We don’t have an agent, looking to capitalize on our past performance with a max contract. Worse yet, we’re in the corporate world, where we’re deemed tenants at will. Despite our self-worth and proven value, predicated on years of accumulated tribal knowledge and accomplishments, we’re highly expendable – easily replaced, made redundant, or otherwise evaporated at a moment’s notice.

Granted, there are plenty of situations, activities and decisions in our working worlds that are well beyond our control. That promising early-stage start-up could fail to land the next round of funding. The post-acquisition environment for an organization may face massive consolidation and redundancies. The big brand, F500 company may have missed Wall Street’s expectations on quarterly earnings. Anything can happen at any time. And the pace of change is only getting faster. Your company’s picture keeps changing before it’s been fully drawn.

Yet, as working professionals, we are the possessors and caretakers of something that is a constant – our own individual brands. And our individual brand, like any brand, represents a promise; an assurance that the experience and resulting performance will meet or exceed expectations. To sustain and build upon the aptitude, attitude and performance our individual brand promises – now that is something we fully own and control.

The best of breed employees and top tier candidates understand this ethos. They embody pride, integrity, credibility, accountability, drive, and consistency – intangible attributes hiring executives consciously (or sometimes subconsciously) seek out in candidates. As I tell my 12-year-old daughter on a regular basis, you have to go to the trouble of doing the job anyway. So, you might as well do a really good job.

Many people just completed a year during which they worked hard to hit their goals. They climbed the mountain and reached the summit. And now with a new year, they’re back down at the base of the mountain, staring up at a new set of sky-high goals to attain. No, we’re not exorbitantly paid professional athletes, looking to hit it big after completing a successful contract year. Yet, there’s no reason to think this couldn’t be that contract year.

The next stellar career opportunity may be right around the corner. The best way to land that position is to be the athlete everyone is vying to hire. And there’s nothing preventing us from acting as though we’re in a contract year. Besides, in our world, every year is a contract year.

 

Action items:

  1. Don’t just do your job. Do it well. And while you’re at it, keep track of your stats – the goals you’ve achieved, the milestones you’ve surpassed, and the initiatives you’ve driven.
  1. The euphemism for a top-tier candidate is “athlete.” So, embody the mindset of one, starting with defining your personal brand and the value it brings to companies.
  1. How would you feel about being paid millions of dollars to win…or lose?

Of Course It’s About Compensation!

October 24, 2014

In this era of spin-doctoring, I continue to be amazed by both hiring companies and employment experts who downplay the importance of compensation in the eyes of candidates and employees. The latest hiring company touts their industry-leading innovative solutions and thought leadership, only to be outdone by their transformative modern culture. Sounds impressive. Too bad I’ve heard the same thing from nearly every other organization. Meanwhile, management consulting experts point to the many employee surveys that rank the importance of compensation below nearly all other critical factors, coming in just above Tacky T-Shirt Tuesdays, Red Sox ticket raffles and ping pong tables.

One VP Sales told me how he took a pay cut to join the company and expects others to do the same. Well, bully for him! I’m sure he’ll offer candidates the same generous equity allotment he gladly accepted. News Flash: It is no longer 2009! We are in the midst of a candidate-driven market, one that has raced past prior employment surveys and compensation benchmark studies.

No doubt, all the trappings of a great gig need to be in place: discernible career advancement paths; supportive and constructive culture; phenomenal product or service in a growing space; equally phenomenal people; acknowledgement for work well done; attainable goals; openness to new ideas; absence of politics and needless bureaucracy; sensitivity to work/life balance; strong financials; growing customer base; and leadership that embodies passion, vision, and ability to execute. Yet, nearly every hiring company paints a reasonable facsimile of this picture. That brings us to the elusive issue of compensation.

My hiring clients that have been winning the talent wars are the ones who prioritize getting the right people on the bus over managing to a rigid line item in a budget spreadsheet. I’m not suggesting that hiring companies abandon fiscal responsibility altogether and approach the talent market with a blank check policy. Rather, I strongly encourage companies to take a more accurate pulse of the market right now and at the same time, build in the flexibility needed to craft a compelling offer to the right candidate. While hiring companies have been flaunting everything except compensation, I’ve noticed how candidates are bringing it back front and center.

Of course, compensation means different things to different candidates. The weighting of base salary, variable compensation (e.g., bonus, commission), equity, and benefits gets distributed differently from candidate to candidate. Some prefer the perceived security of a stronger base while others desire greater upside via an uncapped variable with accelerators. There is another group that gravitates towards early-stage companies for the equity lottery ticket, betting on an exit event that could yield a far more significant material impact.

The point is we all work for several reasons, with making ends meet and achieving personal financial goals at or near the top of the heap. And in the current candidate-driven talent market, hiring companies can ill afford to sweep this reality aside. There are many exciting companies to work for these days. They offer promising futures, positive environments and best-of-breed innovative solutions. They have very compelling stories to tell. However, for every one of them, there are twenty others offering up the same attributes. At the end of the day, one of them will win out on hiring the candidate five others were also vying for. And it won’t be because of Halloween costume parties or Call of Duty tournaments.

 

Action items:

1.  It behooves both candidates and hiring companies to gain a real-time snapshot of the current market conditions as it relates to compensation. Ask trusted recruiters who work in the same space. Ask other hiring executives. Ask other candidates who have recently accepted a new position.

2.  The inability to attract and hire top talent in a timely manner is by far the greatest barrier to achieving business objectives. Companies ought to assess their recent hiring performance and come to grips with why open reqs are taking months instead of weeks to fill.

3.  Upon putting together an offer for a finalist candidate, don’t just send an offer, hoping it gets accepted. Take the time beforehand to engage the candidate in an open and honest dialog about compensation and what it would realistically take to get them on board. Socializing an offer first allows both parties to fully understand what’s important to one another while facilitating a verbal meeting of the minds. By the time a formal written offer is sent to the candidate, the offer terms should be no surprise.

Seven Mistakes Hiring Companies Make

June 30, 2014

Many hiring companies seem to have missed the talent market pendulum shift. News flash: It’s no longer 2009! We are in a full-fledged candidate-driven market and a company’s competition is not just others that play in their space. It’s every other company that’s vying for the same talent. The companies that adapt to market conditions will win the talent war. As the legendary recruiter, turned talent acquisition thought leader Lou Adler states: “You can’t use a talent surplus model in a talent scarcity situation.”

As both a long-time hiring executive and recruiter, I’ve seen (and made) a fair number of hiring mistakes. Some were process shortcomings while others were misguided priorities. Whatever the case, it’s vitally important to identify them and make course corrections, aimed at improving hiring effectiveness. While there are many hiring problems that companies bring onto themselves, here are some of the most prevalent and debilitating ones I come across.

1) HR IN A VACUUM

Ah yes, our good ol’ trusty Human Resources comrades. Some of them get it. They realize that it’s not all about them and their own stringent rules and processes. Ultimately, it’s about results and catering to their internal customers’ hiring needs. What better way to cater to a hiring manager’s needs than to fully involve them in formulating the candidate profile as well as truly understanding what a person needs to do to be successful in the role. Moreover, hiring managers must have a direct tie to the recruiter throughout the entirety of the hiring process. Unfortunately, many HR folks take an exclusionary stance, pushing their own agenda as both the gatekeeper and soothsayer of all things hiring.

2) COMPENSATION INFLEXIBILITY

Many of the most successful and forward-looking companies understand that for any given position, setting a rigid compensation level based on a budgeted line item in a spreadsheet represents a needless self-inflicted wound. The best companies prioritize getting the right person on the bus, and in doing so, let the market dictate what takes to acquire top talent.

The talent market is highly dynamic, meaning that compensation levels from candidate to candidate are all over the place. They will vary from week to week and candidate pool to candidate pool. Thus, setting an inflexible arbitrary compensation level is bound to be incongruous with what the market will bear. Naturally, all hiring executives need to set budgets and manage to them. That’s where external resources, like search professionals come in real handy when it’s budget-setting season as they can provide a realistic compensation range based on current market conditions. And yes, compensation includes non-cash components, such as equity and differentiating benefits – all necessary to help bolster competitiveness in a candidate-driven market.

3) FITS AND STARTS

Understandably, both hiring managers and their HR colleagues have much more on their collective plates than interviewing and hiring candidates. In many high-growth environments, interviewing and hiring could be a full-time job. Regardless, companies should not endeavor to hire top talent unless they are willing and able to commit the time and priority to make it happen.

All too often, I’ve been approached by companies desperate to hire for what is deemed a critical position. And as usual, they’re months behind on their hiring timeline. After completing the candidate development phase of my search, I present several strong, well-qualified and engaged candidates. But then, when the rubber needs to meet the road, schedules become too full and calls and emails go without response, resulting in interviewing delays and multiple rescheduling. What do you think this says to the candidate? “This company doesn’t have their act together.” “I guess this is not a critically important hire afterall.”

4) GET VS. DO

Simply put, many companies make hiring decisions based on candidates who can get the job (i.e., polished interviewees who say precisely what interviewers want to hear) instead of those who can do the job. They ask their very clever (and sometimes tricky) interview questions, looking to hear the “right” answer. Instead of treating the interview like a game show, interviewers would be better served to focus on performance-based criteria, such as behavioral and real-world situational interviewing. By the way, sometimes the most talented and qualified people are not necessarily the most polished interviewees, especially if they haven’t been out there interviewing much over the last several years.

5) INTANGIBLES CHALLENGED

It is far too easy for hiring companies to base their decisions on tangible elements in candidates’ backgrounds. Examples include educational pedigree, number of years in each position, specific domain experience (e.g., worked for a company in the same space, marketed/sold to the same target audience, coded the same type of software, etc.), and big (or small) company experience. While some of these factors may bear relevancy for a given role, they do not encompass the universe of hiring criteria. In addition, some of these areas – such as software and target market, can be taught.

One of the biggest mistakes I see hiring companies make is hiring based on tangibles, only to end up firing for the lack of intangibles. As a hiring executive, I quickly learned to prioritize hiring based on the attributes I couldn’t teach: passion, drive, inquisitiveness, coachability/self-development, aptitude, positive mental attitude, and self-awareness. More times than not, this led to the greatest hires.

6) NOT A THROUGH STREET

As an adjunct to intangibles, many hiring companies will not consider candidates who took the road less ventured. Many of the top talent took a circuitous path to greatness. Perhaps they took a chance with some early-stage start-ups that only lasted a year each. Or maybe they started in a technical role, but discovered along the way that they were more effective in sales than the salespeople they were supporting. These highly talented “non-traditional” candidates aren’t even given a chance by many hiring companies. Big mistake.

7) YOU HAVE TO SELL ME

Granted, candidates must keep their sales hats on throughout the interview process to make the case for their value and fit. But again, this is not 2009 anymore. Companies that act as though they are the only high-growth, innovative place where people are clamoring to join are simply delusional. The interview is a two-way street and in these current times, it is difficult enough just to engage with top talent. By and large, companies do a masterful job at marketing to their prospective customer base to generate revenue and market share growth. Yet, they tend to do a lackluster job at selling to the very candidates who could help drive further growth and favorably impact the shape and direction of the company’s future.

No doubt, there are plenty of other mistakes hiring companies make. And candidates are not without fault, either. I’m amazed by all the great talent out there, many of whom do such a disservice by not positioning and promoting themselves in the most flattering light possible. It’s as though they’re leaving it up to hiring companies to discover the diamond in the rough.

Ultimately, a hiring company that is behind the curve on attaining their hiring objectives (i.e., most every company out there), would be best served to do a deep dive assessment on their current hiring practices. Perhaps consider bringing in an objective third party who can evaluate with a fresh perspective and cast a light on every facet of the hiring process – warts and all. With a constructive and open approach, mistakes become opportunities.

 

Action items:

1. What are your hiring objectives, associated hiring timeline goals and employee retention figures? What is the delta between your goals and actuals?

2. How well are the new hires working out long term and why did the ones who left or were terminated not work out?

3. Take an honest look at your hiring practices and compile a list of processes, mindsets and tendencies that might be inhibiting desired results. Start working on these issues internally or with the help of an objective third party resource.

Candidates and Houses

October 24, 2013

For the past year, it seems that homes in the Northeast region are not staying on the market for long.  In fact, the incidence of competing offers, most all coming in above the asking price, has skyrocketed of late.  Even homes with less curb appeal that sport tired, outdated kitchens are flying off the market.  Homebuyers are forced to shorten their decision-making process considerably just to have a chance.  Sure, the economic climate is still questionable.  But tell that to the housing market.

Eerily similar is the hiring environment.  Over the past two years, the greater Boston metro area technology realm has trended towards a full-blown candidate driven market, resulting in continued lower unemployment rates, increased incidences of competing offers and counteroffers, and offers that contain additional points of leverage (e.g., increased stock options, RSUs, signing bonuses, guaranteed commissions during ramp-up period, unlimited PTO policy, etc.).  Even candidates with less curb appeal, meaning poorly crafted resumes along with problematic job moves, uninspiring accomplishments and less relevant skill sets, are getting interviews.

Unlike homebuyers, who have either learned the hard way or have been suitably admonished to recalibrate their approach, many hiring companies are missing opportunities to acquire strong candidates because they haven’t adjusted their interviewing cycles and offer components to reflect the current talent market dynamics.  Somehow, they still have it in their mind that it’s 2009, their company is the most exciting and attractive one to join, and that candidates should feel privileged just to gain an interview.

Growing companies looking to scale their business must meet their hiring objectives, especially as it pertains to hiring timelines.  To do so, they simply have to get their hiring acts together.  Here is a list of the top 10 best practices I’m seeing the more successful companies doing on a consistent basis to attract and successfully hire strong candidates.

1.  Conduct proactive recruitment to better engage with passive candidates.

2.  Build in flexibility to hiring budgets so that the priority can be to get the right people on the bus vs. managing to a stringent line item.

3.  Understand that the entire interview process must involve selling the opportunity just as much as scrutinizing the candidates.

4.  Streamline the interview cycle and delays between interview rounds by marshaling internal resources to enable substantially greater prioritization of hiring.

5.  Rely upon recruitment thought leaders instead of cutting corners by trying to go at it alone.

6.  Engage with search professionals who have their finger on the market’s pulse, have served as hiring managers in the past, and can provide a higher level of counsel to your interview process and offer components.

7.  Be prepared to shift on the fly if an in-demand candidate is being courted by multiple suitors or if opportunistically, a compelling candidate for a position that doesn’t yet have an open req. jumps into your purview.

8.  Truly listen to how each finalist candidate prioritizes the prospective offer components and have a flexible offer model to accommodate those preferences as best as possible.

9.  Base hiring decision on intangibles (passion, drive, creativity, inquisitiveness, self-awareness, etc.) just as much, if not more than tangibles (education pedigree, company pedigree, domain experience, etc.).

10. Offer a discernible onboarding/ramp-up plan as well as attainable career advancement paths.

Just as with homebuying, no hiring optimization plan is foolproof.  Most assuredly, there will be the ones that get away.  The point is to stack the deck in your favor and to wholeheartedly compete beyond the perfunctory “We offer competitive salaries and a comprehensive benefits plan.”  Now go out and get that dream home…er…top candidate.

 

Action items:

1.  How far off are you from attaining your ongoing hiring objectives?  Be honest, because nearly all companies fall off the mark.

2.  How many of the 10 best practices listed above have your company fully embraced?  Get the senior leadership team together to form an action plan that addresses the best practices not yet enacted.

3.  Wake up!  It’s not 2009 anymore!

The Components of a Compensation Package

August 23, 2013

I’m truly blown away by how many different models of cars there are to choose from these days.  It would be one thing if all the cars were so drastically different from on another, but as each model year comes and goes, it seems as though car designs and their respective accoutrements become more and more homogenized.

Such is the case with job offers and their respective compensation packages.  Or so it would seem.  Putting aside those crazy years before the internet bubble burst, when offers were accompanied by decadent enticements like sign-on bonuses, trips, cars, personal shoppers, and clones to do your job for you, the perception from many candidates is that one offer is just like the next, only with some numerical differences in the base salary and variable.  It’s as if we’ve been conditioned to look at offers in a myopic fashion.

But lately, I’ve seen some nuanced differences amongst my hiring clients.  First, let’s break down the different components of a package.  On the cash side of the equation, there’s the base salary.  In a commissioned sales role, it’s quite typical for the base to be roughly 50% of the on target earnings (OTE).  For marketing, product marketing, product management, and pre-sales engineering roles, I’ve seen the base represent 70% – 90% of the OTE.  And for post-sales consulting/implementation roles, it usually falls in the 80% – 90% range.  There certainly are exceptions, but these ranges have been fairly consistent over the recent years.

The variable cash compensation is either a bonus or commission.  The bonus is usually comprised of management by objectives (MBOs), in which the hiring manager and new employee agree on milestones to achieve that align with and support the greater organization or company goals.  In addition, there may be a smaller component of the bonus that is based on company performance.  In a pure sales role, the variable is usually all commission, but will depend on the level of the position and its associated responsibilities.

Beyond base and variable, I’ve seen some companies offer profit-sharing, delivered as cash payments quarterly or year-end lump sum.  Sometimes, they’re funneled into an employee’s 401K.  Beyond that, there are the miscellaneous odds and ends not covered in a job offer, such as spiffs and contests.  And while these trinkets are generally short money, they can add up over the course of a year.  And yes, once in a while, I still see the perfunctory Christmas bonus – or to be politically correct, holiday bonus paid out, although that’s become rather antiquated.

Next comes equity, nearly always in the form of stock options, restricted stock units (RSUs) and employee stock purchase plans.  Without going into too much granular detail, stock options are a grant of a specific number of shares that vest over a period of time (usually four years).  Once the options vest, the employee may exercise their options and purchase them at the price that was established at the time the options were granted – usually when the employee first joined the company or as additional options are granted down the road.  A restricted stock unit (RSU) is a grant valued in terms of company stock, and similarly to stock options, they are not issued at the time of the grant. RSUs do not involve having the employee purchase the shares.  After the employee satisfies the vesting requirement, the company distributes shares or the cash equivalent of the number of shares used to value the unit.

In most cases, job offers that include company stock involve stock options.  The number of stock options in the offer doesn’t mean anything on its own.  What matters is what that number represents as a percentage of all the company stock, known as outstanding shares.

Finally, there are benefits.  Granted, most companies offer a reasonable assortment of benefits, including a health plan, dental (although I’m seeing fewer smaller companies offering dental as the value of the plans can be questionable), life insurance, short term disability, long term disability, accidental death and dismemberment, vacation, holidays, birthdays off, tuition reimbursement, health savings account (HSA), flexibility to work from home, etc.

The mix of base salary, variable, equity, and benefits varies widely.  Traditionally, it has varied based on the nature of the position and the company’s priorities, but lately, I’ve seen these components vary based more on the finalist candidate’s preferences.  Some people, who are more risk averse, don’t care as much about equity and want the perceived security of a higher base.  I say perceived because negotiating for a high base could pay off short term, but potentially come back to haunt the employee down the road should the company have to make difficult decisions on cost cutting.  Base salaries are a fixed cost and usually represent the most expensive part of a company’s budget.  So for an employee to have a higher base salary compared to others in the same peer group, that person could potentially be targeted for headcount reduction.

Other people prefer to have greater variable, offering the chance to overachieve on goals and make even more money.  Such a leveraged plan is more typical of a pure sales role.  This type of plan is for people who want to have greater upside in their cash compensation plan and with that, better control their earnings destiny.  I advise salespeople that they shouldn’t be so concerned about base salary if they are confident of their selling ability.  After all, in sales, it’s not about meeting your quota.  It’s about exceeding it and getting into accelerators.

The equity piece comes into play as a more significant factor with earlier stage companies.  By far, the equity allotment in an earl-stage company will have a material impact on one’s livelihood down the road, assuming the company enjoys strong growth and has a successful exit event (i.e., acquisition or IPO).  One of the main reasons to join a small, early-stage company is to have a chance at this high reward.  Yes, it’s a lottery ticket.  But if you don’t play, you can’t win.

Finally, I’m seeing some differences with benefits offerings.  Lately, I’ve seen several companies offer 100% heath care coverage, meaning they will pay 100% of the employee’s monthly healthcare premium.  Over the course of a year, this has material value as it can save an employee thousands of dollars from monthly paycheck deductions.  In addition, I’m seeing more and more companies offer unlimited vacation.  All they ask for is the courtesy of advance notice.  This benefit sends a clear message to the employee base.  Essentially, it says, “We want to treat you as mature, responsible adults and as long as you get your job done well, we’ll be flexible and not micromanage you.”  Interestingly, according to recent studies, most people under this plan don’t end up taking more than 2 – 3 weeks off anyway.

As a candidate, it’s important for you to prioritize what’s really important to you.  Many candidates are more than willing to take a cut in their base salary for an opportunity to join an exciting, innovative company whose culture they can truly thrive in and have a chance to hit it big with a successful exit event down the road.  Other candidates prefer to shore up their base salary as they have a higher cost base in their personal lives (e.g., mortgage, child care, college savings, car payments, etc.).

For hiring companies, the mix of base, variable, equity, and benefits gives you the opportunity to truly differentiate yourself from other competing hiring companies.  Not only can you come up with creative offerings, but also offer flexibility in the mix of the offerings to better suit the preference of the candidates you wish to hire.  Unlike cars, hiring packages do not have to be alike.

Action items:

1.  As a candidate, be careful not to think too myopically about the compensation package offered to you.  Take into account longer term facets, such as equity, benefits, company culture, and career advancement paths.  I’ve seen far too many candidates make regrettable career decisions based solely on base salary combined with pie-in-the-sky variable packages that turn out to be unattainable.  And even if the cash compensation is strong, how sustainable is such a role if many of the other attributes are sorely lacking?

2.  Add up the benefits and assign dollar values to them.  You’d be surprised how much material impact they can have.

3.  What are you really looking for in your next career move?  Make a priority list and use that as your North Star in assessing opportunities and offers.

Respond to a Recruiter?

April 24, 2013

Nearly everyone receives unsolicited contact from a recruiter, sometimes multiple recruiters, touting new and exciting career opportunities.  Some of these positions sound better than they actually are while others don’t seem all that interesting to begin with.  Putting aside the apparent quality of the opportunity, not to mention quality of the recruiter, what do you do when a recruiter reaches out to you?

In the last decade, there has been something of a shift.  Whereas many prospective candidates used to reply to recruiters’ outreach, thanking them for the contact while basking in flattery, today it often brings a decidedly different sentiment.  Nowadays, many people don’t respond at all and when they do, they don’t necessarily view it as a mutually beneficial event.  Why the change?

Let’s look at some of the most likely reasons why individuals decide to forgo contact with recruiters:

  • Not looking to make a move right now
  • Distrusting of recruiters
  • The opportunity presented does not map to specific career interests and preferences
  • Since companies pay recruiters for placements, candidates presented to companies via recruiters must surely be deemed less desirable as they will be more expensive to hire
  • Too busy to engage with recruiters; not considered a valuable use of time
  • The best positions will come via network referrals

Granted, recruiters come in all shapes, sizes and levels of competency.  Some recruiters may not bring enough value to the table to warrant the time spent with them.  However, there are many high quality search professionals out there, some of whom even come from the space they now serve.  Along the way, many of these recruiters have themselves been candidates as well as hiring managers.  Although recruiters typically make contact because of a specific search they’re working on, these are exceptionally well-networked people who can help you now as well as potentially down the road.

Thus, if an individual is not looking to make a career move at the moment, there’s always a year or two from now when the situation may change.  By engaging with a recruiter, you’ve potentially planted seeds for later.  And even though recruiters are focused on their current searches, quality recruiters know when they’re speaking with a bright, talented individual who could become a highly sought after candidate when the time is right.

Some people do not trust recruiters.  Often times, they’re viewed as carnival barkers, spouting off at any length just to fill a slot.  True, such animals do exist.  However, search professionals worth their salt know that poor quality hires reflect poorly on themselves.  It’s in a recruiter’s best interest to ensure a win-win.  Of course, there are situations that go well beyond a recruiter’s control or vantage point.

Two years ago, I placed two highly intelligent and savvy senior sales individuals with an early-stage, well-funded SaaS-based software company that appeared to be growing and becoming true thought leaders in their burgeoning space.  Unfortunately, just a few months after placing them, the SVP Sales left the company and soon after, the CEO and CMO were ousted.  The company quickly became an insurmountable mess.  These things happen.  After all, when dealing with companies and careers, there are multitudes of variables that can impact the viability of a given position.

If a recruiter contacts you regarding an opportunity that doesn’t quite match up with your skills or aspirations, why give them the cold shoulder?  Instead, try engaging with the recruiter to learn of their areas of focus while discussing the types of opportunities that could be more relevant to you.  If the recruiter works in your field of interest and appreciates all you bring to the table, you will likely get on their radar screen for more appropriate opportunities as they crop up.

Everyone is busy.  We get that.  Yet, even if you gave a recruiter just 5 or 10 minutes to establish a connection, you’d be surprised about how that connection could pay off.  Given how well-networked recruiters tend to be, perhaps they can help you make contact with a company or individual.  As always, one hand washes the other and top tier recruiters keep this in mind when trying to engage.  If they offer to help you, perhaps there may be an occasion when you’ll be able to help them.

As for the increased expense of coming to a prospective employer via a recruiter, let’s back up a little.  In many cases, hiring companies have already tried to do the hiring themselves and are finding that they’re falling way behind in their hiring objectives.  They then make the conscious decision to partner with an external search professional.  By this time, the hiring company is happy to receive quality, well-vetted candidates.  The price a company pays a recruiter pales in comparison to the cost of either a bad hire or months of wasted time not hiring at all.

Finally, it’s true that many solid career opportunities can present themselves directly from your own network.  Yet, relying solely on your network to connect you with desirable positions represents the mere tip of the iceberg for relevant opportunities in the market.  The higher quality recruiters tend to work on more exclusive searches – ones that may not be posted or widely advertised.  Thus, your network isn’t even privy to many of the quality career opportunities.  Also, just like you, your network is populated with busy people.  As much as they’d like to help you, they’re consumed with their own affairs and are not in the business of career matchmaking.

Ultimately, it is in your best interest to respond to recruiters, even if you’re not looking to make a move.  They can help you from a networking standpoint, both now and in the future.  They can give you a helpful snapshot on current market conditions as well as an approximate valuation on you as a prospective candidate.  Recruiters may provide you with valuable feedback on your career track, resume and interviewing style.  They can bring to your attention relevant opportunities that you otherwise wouldn’t have known about.  The next time a recruiter tries to contact you, think twice before discarding what could be an important and useful connection.

 

Action items:

1.  Recruiters are like other networking connections.  They may not be in a position to help you right now, but you may very well have a need for them and their expansive network in the future.

2.  Even if you’re not looking to make a move, talk to recruiters when they reach out.  They can provide you with a snapshot of your value in the marketplace, perhaps giving you some ammunition when negotiating your career track within your current employer.

3.  Getting into an opportunity via a recruiter is truly an advantage, not a drawback.  Recruiters can supply their candidates with valuable insight into the company, its people and their hot buttons.  Recruiters can also provide counsel on resume and interviewing best practices.

Just Different

February 26, 2013

In assessing a career opportunity, there are seemingly infinite attributes to consider.  The same point can be made for assessing candidates.  And just as no two jobs are the same, no two candidates are cut from the same cloth.

With this in mind, it strikes me as odd when a candidate approaches me with a list of must-haves for their next career move, of which the level of specificity immediately rules out every opening.  Essentially, they’re writing the script to their own fantasy movie.  Naturally though, our lives are not lived in a vacuum.  We are all interrelated and inter-reliant.  Thus, despite our best efforts, the movie scripts to our lives are perpetually penned my multiple authors.  After all, as John Lennon once said, “Life is what happens to you while you’re busy making other plans.”

Invariably, the candidates who can articulate their career preferences yet maintain an open-minded stance are more likely to enjoy a successful and robust career advancement track.  Along with possessing the self-awareness needed to know both their strengths and vulnerabilities, these individuals have an innate understanding of our dynamic, ever-changing business world.  They have the wherewithal to put aside their biases and try a new career opportunity on for size, giving it full and fair consideration.  In many cases, compared to a given candidate’s preferences, career opportunities are not better or worse – just different.

Hiring managers are best served to invoke the same level of open-mindedness.  It amazes me how often hiring managers dismiss candidates simply because these prospective employees can’t be neatly fit into a box.  There are so many non-traditional candidates out there who bring exceptional intellect, attitude, and multiple skills to the table.  Just because these individuals didn’t follow a typical career path or possess specific domain experience, they are summarily cast away without being given a chance.

As a VP Sales, I made a good living hiring non-traditional candidates because I was focused more on the intangibles (e.g., personal drive, ability to overcome adversity, proclivity for picking up multiple skills, passion, coachability, and positive mental attitude).  And let’s be honest with ourselves.  The arrival of our current career track came via a circuitous path.  I never met a single person in college who said, “I’m studying to go into Sales.”  Yet, look at all the accomplished sales professionals out there.

Ultimately, no one career opportunity or candidate is a perfectly written script.  There are pimples and warts to everything.  But along with those pimples and warts may be diamonds and pearls that initially didn’t cross our radar screens.  The only way to discover these seemingly hidden gems is to be open to considering them and taking the extra step to learn more.  We all need to resist the prevailing thought process ingrained in most all of us that different is bad.  Different is different.  And in many cases, that leads to innovation, fresh perspective, unyielding drive to prove, and success like you’ve never imagined.

 

Action items:

1.  Fantasy career moves and fantasy ideal candidates are akin to movie scripts.  They’re conceptualized in a vacuum without the influences and dynamics of the real world around them.  Discuss your preferences with a search professional or other trusted resources to help gain a reality check.

2.  Always keep an open mind on both career opportunities and prospective candidates.  You don’t want to close any doors until you see what’s behind them.

3.  Different is not better or worse.  Just different.

Questions about Seasonality

August 20, 2012

On a regular basis, I’m asked by candidates for my take on the current state of the job market.  The second most common question I’m asked is about timing.  When is a good time to search for new positions?  Are summer and Thanksgiving through New Year’s throw-away periods, when job opportunities are sparse?

Keep in mind that my focus is the technology domain.  As such, my take may not apply to other areas that may have quiet periods, such as higher education, government or agriculture.  Within technology, the short answer is “No.”  There is no discernible seasonality to hiring.  In some years, both as a hiring executive and more recently as a search professional, I’ve had wildly busy summer hiring periods, only to be followed by the doldrums the next summer.  The same holds true with the oft dismissed Thanksgiving to New Year’s stretch.

So why do these times of the year carry the stigma of being useless for job seekers?  Starting with the end of most companies’ Q2, summer essentially begins with the 4th of July holiday, in which most everyone piggybacks multiple days off around the holiday itself.  Extending through August, this represents the most popular vacation time for people (i.e., hiring executives) to take.  However, since this time period also represents the midway point in the fiscal year, many companies take this time to assess and readjust their annual business plans.  Such adjustments include terminating non-performing employees, conducting layoffs, starting up new initiatives and teams, and opening up new hiring reqs.

As a result, the summer can be an excellent time to seek new opportunities.  The downside, which many people misinterpret as being a summertime hiring lag, is that many hiring managers and others on the extended interviewing team take vacation time.  Invariably, this leads to recruitment, interviewing and hiring delays.  An open position that should have taken 6-8 weeks to fill is now taking 10-14.

As for the late fall/early winter timeframe, there are similar forces at play.  Many companies are finalizing next year’s business plans and want to get a head start on hiring.  However, there are multiple speed bumps that slow down the hiring process, starting with Thanksgiving and continuing on with multiple holidays parties.  It culminates with that lost week between Christmas and New Year’s.  Once again, there’s the perception of a hiring slowdown, but in reality, it’s purely a logistical issue.

Companies that are growing have an ongoing need to hire.  There is no seasonality.  They hire when they are successful in attracting the right candidates.  That challenge doesn’t ebb.  Just like the stock market, in which experts admonish us not to time the market, the same holds true with job seeking.

More importantly, I believe that candidates should be in a perpetual state of making their own activity.  Seek out companies of interest, regardless of their open positions, and find ways to get in via informational meetings.  It’s amazing what doors can open from this proactive approach.  Interestingly, summer and late in the year can be two of the best times to do this.  Vacations notwithstanding, hiring executives generally appear to be more amenable to meeting people during there periods.

The best time to conduct a career search is when you’re open to a change and willing to commit to it.  Let your network know of your intentions, contact your trusted recruiters, and do your research.  From there, don’t worry about timing.  Anything can happen at any time of the year.

 

Action items:

1.  Don’t let perceived seasonality serve as an excuse not to work on advancing your career.

2.  There’s no reason to wait until the new year, end of summer or months with an “R” in them.  Growing companies are continually challenged with finding good, qualified talent.

3.  Forget about the ebb and flow of the job market.  Create your own momentum by proactively researching companies and working your network to get a foot in the door.

What Comes Before Workforce Retention?

January 23, 2012

Last week, I attended a seminar on workforce retention.  Just the notion of having such a meeting topic sparked the question:  Is this a sign that the job market pendulum is shifting in the other direction?

Actually, the pendulum shifted back in candidates’ favor early last year.  It’s just that virtually no one was willing to proclaim such a milestone.  It seems that such declarations are done while looking in the rear view mirror.  Over the recent months, a substantial number of the long-term unemployed and underemployed have gotten hired into new positions and this trend appears to be accelerating.  Many of those who have been employed all along, albeit under duress, are now seeking better opportunities in a highly selective fashion.

No doubt, the job market is tightening in the other direction.  High growth companies with aggressive hiring objectives are already hitting pain points around not finding enough qualified talent to support their growth plans.  It strikes me as both humorous and disingenuous that companies are now scrambling to address workforce retention.  Not that they’re off base in doing so.  After all, it is far less expensive to retain your good employees than it is to be forced to replace them.  And that doesn’t even take into account the invaluable tribal knowledge embedded in current employees that could easily walk out the door at any time.

The last three years saw companies hold employees hostage.  Given the stormy economic climate, employees were, to a fair extent, afraid.  After seeing many of their colleagues caught up in workforce reductions, they could envision being next on the chopping block.  On top of this enduring angst, employees whose jobs were saved were rewarded by inheriting additional workloads and work hours.  Their positions were transformed into ones they did not sign up for, all the while not being compensated at levels commensurate with the additional load and responsibility.

That’s why workforce retention talks that are occurring now come off as disingenuous.  During the last three years, why didn’t managers and executives reach out to their front lines, listening to their concerns and ideas?  Why didn’t they offer more flexible work schedules to offset increased workloads?  Why didn’t they step up their recognition programs?  Why didn’t they promote a culture of loyalty?  Sadly, the answer to all these questions is because companies could get away with it.  There is no loyalty.  And now, in an environment that enables sweet revenge for all those pent-up feelings of being unappreciated and exploited, it’s the employees’ turn to vote with their feet.

Yes, let’s talk about raising the game regarding employee retention.  But first, let’s do it with consistency, regardless of the economy.  Let’s do all we can to protect our most valuable asset – people.  But first, let’s make sure we get the recruitment, hiring and onboarding phases right.  What good is an employee retention plan if your front-end processes are marred with delays, unresponsiveness, empty promises, and incomplete, inaccurate job descriptions?

Addressing workforce retention now implies that it wasn’t valued before.  It is being instituted reactively to put out preventable fires.  Where there’s no loyalty, there’s no trust.  One of my very first sales managers told me that the mark of great sales professionals isn’t how they perform during good times, but rather how they think and act during tough times.  That always stuck with me.  So why shouldn’t that adage apply to companies?

It’s all too easy for organizations to proclaim their care and concern for their employees’ welfare and thoughts during good times.  The real test is how adept they are at employee relations during tough times.  Better times may indeed be at our doorstep.  But before rushing off to avert unwanted employee attrition, put some serious thought into why people may want to leave.  In doing so, you may gain actionable corrective insight that ultimately may help encourage people to join…and stay.

 

Action items:

1.  Before you fully address employee retention, make sure to get all that comes before that tightened up.  This includes solidifying roles & responsibilities, interviewing & hiring, and onboarding.

2.  Workforce retention should be a company initiative that is ever-present and worked on consistently, whether in good or challenging times.  Otherwise, it can come off as disingenuous and ultimately backfire.

3.  Make sure that workforce retention strategies are ones that can be sustained and followed through on.  To not deliver on retention programs is far more deleterious to employee morale than not having any such programs at all.