Quoting The Clash lyrics “should I stay or should I go” is actually a common question asked by executives when faced with a counter offer from their current employer.
Generally speaking if you are a respected and valuable member of an organisation, an employer is going to be reluctant to let you go. Great employers recognise talent and will work hard to retain their top staff which may include putting forward a counter offer after you’ve announced your resignation.
While it can be flattering to receive one from an employer, international research shows that counter offers are rarely effective at retaining key staff. A recent survey by Hays Salary Guide Australia and New Zealand investigated the allure of counter offers and found that 46 per cent of professionals left anyway, four per cent stayed less than three months, 21 per cent stayed between three and 12 months, and just 29 per cent stayed longer than 12 months.
Before accepting a counter offer, there are a number of key questions to consider to help make a decision that supports personal and professional goals.
Why did you want to leave?
Giving thoughtful consideration to the reasons that made you consider another job opportunity should be a critical part of your decision-making process. There may be one clear reason or cumulative motivations such as increased remuneration, flexible working hours, a desire to switch industries to follow a passion, career progression or the internal working environment.
As part of the Hays’ survey, many professionals found that original motivations for looking elsewhere were not addressed in the counter offer, so while they made a decision to stay, they quickly found a renewed longing to leave due to hitting a career plateau. Additionally if you expressed issues to your employer in the past that were not dealt with effectively, it is likely that these potential deal breakers will resurface, causing you increased angst.
Why is your employer offering a counter-offer?
Executives should always assess an employer’s underlying motives for putting forward a counter offer. Research shows that replacing a senior executive can cost as much as 213 per cent of an annual salary. This is because hiring and training new executive leaders is a costly and time consuming exercise. In many instances, a counter offer is not about an organisation reaching out to meet your needs, it’s about meeting the short-term requirements of business at a specific point in time. For example, it may be an undesirable time for you to leave because a major project is about to commence, or perhaps several employees have recently resigned, and your department can’t afford to lose your particular skill set.
Whether a counter offer consists of the promise of an elusive promotion or enhanced benefit package, it’s critically important to evaluate each component objectively, not emotionally. Carefully assess the remuneration and other benefits presented as these may have been sourced from a future promotion or bonus. You also need to consider the implications of accepting the offer now and what impact this could have on future salary increases and benefits. In the wise words of global recruitment powerhouse Phaidon International: “While many of these comments could be genuine, a good business that values its staff would have made you feel appreciated before you felt the push to leave.”
What impact will a counter offer have on your relationships and reputation?
Announcing your resignation can easily burn bridges within your current organisation as it can signal that you no longer want to be part of the ‘team’ and this can break trust with your employer if not approached in a professional manner. The announcement of your resignation can also raise red flags by creating an impression that you are transient or lack commitment to a company, particularly if your plan was to move to a competitor. This can have a significant impact on your future career progression within the organisation. You may be overlooked for future promotions or find yourself at the top of the redundancy list as your ‘tentative’ resignation inadvertently made you appear easily expendable, taking you out of a company’s succession plan.
What if you choose to stay?
If you have carefully evaluated a counter offer and feel confident that you will be happy, challenged and satisfied in your existing role, the decision to stay may be just what the doctor ordered. Job satisfaction isn’t just about salary or improved benefit packages. For example, the company may be entering a new global market or a new business strategy you devised could be one signature away from Board approval, providing you with new and exciting opportunities to lead a dynamic team, drive profitability and improve performance.
For many of New Zealand’s top executives it’s the combination of a great internal working environment, competitive salary, flexible working arrangements and opportunities for career development that create long-term job satisfaction. If an employer understands the value of providing new opportunities and clearly communicates a pathway for career advancement, the proverb ‘the grass is greener on the other side’ may not be so.
When considering a counter offer always look again at your reasons for leaving, your employer’s motives for the counter offer, and what impact accepting or declining the offer will have before making the next step in your career.
If you find yourself in the position of assessing whether to stay or go, get professional advice by contacting one of our consultants for a confidential chat.
The Decipher Team
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