By Russ Riendeau, Ph.D.
The number one challenge facing business leaders today? Securing and retaining human capital.
As a CEO or key executive you’ve probably heard or even spoken these words:
“We have a better product, service and benefits than our rivals. Let’s lure the superstar sales and management talent to our firm … We need a person who knows our business … someone who can “hit the street running” … a person with a “book of business” that will assure revenue … We just don’t have the time to train someone without knowledge of our business.”
Raiding your rival’s company to recruit top talent, promising them a richer compensation plan, fun workplace, promotions, benefits — even an equity stake — seems logical and lucrative enough. So why is it so difficult to actually raid a rival’s talent pool and bring those employees aboard?
A number of issues face leaders today in need of human capital: High employment rates; demographic shifts in an aging workforce, and reduction in potential workers are key issues. Evidence of a skeptical workforce, still uncertain about our economy, war, oil prices etc., continues to impact candidates’ decisions — as they tread very cautiously when considering new employment.
These factors affect the overall working population, but what about sales and management talent? What additional factors create psychological and business practice challenges when recruiting from a rival?
Having conducted more than 80,000 interviews with business professionals over the past 20-plus years in search of top performers for client companies, I’ve compiled a list of key factors facing companies who are looking to recruit top sales and management talent from rivals:
1. Hide ‘n seek for top talent. Mobile workers and technology thwart efforts to find talent quickly.
2. Non-compete agreements. The best will have an agreement and be bound (or at least intimidated) to remain in order to avoid legal issues.
3. Counter-offer tactics work — just long enough to deflect defectors from leaving.
4. Emotional ties, fear of change, bonus money due, concerns with customer credibility, traitor-labels, and guilt are all factors that weigh heavily.
5. Top talent is most difficult to extract and satisfy — marginal performers will always look to leverage their position with a rival.
6. Reference checking is near impossible to secure accurate insights to character and skill sets. Marginal performers are able to hide in the fog of confidentiality, thus avoiding revealed weaknesses from vendor references.
7. Second-guessing by the raiders: “If they’re so good, why did they let the top talent get away? What’s wrong with this picture?”
8. Client relationships and “book of business” do not follow sales people like lemmings to the sea. Studies show less than 15 percent of business survives the journey in the first 12 to 18 months.
9. Sometimes it works. A superstar jumps from his company’s business pool and swims to yours with no problem — the exception to the typical situation.
10. It’s expensive. Compensation plans must entice superstars, and issues arise in the rank and file wanting equal pay.
11. Conflict arises as customers, torn between two vendors, could seek neutral vendors to avoid conflict and legal troubles; both companies lose.
Having explored the challenges to raiding your rival’s company, here’s a list of things you and your organization can do right now to offset the challenges and risks of raiding your talent pool, while putting proactive systems in place to draw from a larger ocean of top talent. By designing and implementing efficient systems to quicken the time and effectiveness of new sales and management professionals, you can avoid the wars on securing rival talent and attract those who want to board your ark or enter your markets.
1. Proactive hiring practices are mandatory. Don’t wait till someone quits or is stolen to start a search. Plan “B” stands for “If it ain’t broke, keep spare parts on hand in case.”
2. Create specific initiatives and goals that this job must fulfill that are measurable and critical. Now require candidates to document that they have achieved similar results in the past. This allows the measuring of consistent patterns of behavior and success.
3. Create written job descriptions including core competencies and personality traits required for each sales and management position.
4. Install an incentive program that is performance-based. This accountability weeds out unmotivated and socialism in the sales ranks.
5. Use a validated psychometric instrument to benchmark existing employees and use with each viable applicant. Gut intuition is strengthened with measurement.
6. Explore other industries that have successfully recruited talent from outside their industry.
7. Design or purchase a thorough, consistent and implementable sales training / product training program for every new employee. Raise the odds of success. Monitor progress carefully.
8. Consider retraining or realigning existing people in your company. Are the workers in-house in the right job for their skill sets?
9. Consensus hiring is out. Hiring managers must be accountable for their direct reports. Input from group interviews: yes. Final selection by consensus: NO.
10. Reward activity that leads to accomplishment. Create incentives that encourage and pay incentives for proactive behaviors that will lead to sales. This approach also provides management with feedback on process, learning, habits, intellect, drive, motivation, etc. (It’s also insurance for jump-starting sales if the person fails and a newcomer picks up the trail.)
11. Interview approach: A three-interview minimum, different interviewers, field trip, one interview during a public meal, references, phone interview to check energy and articulation, written case study and a strategic plan for first 90 days, to be written by the applicant.
Applying these analytics and systems to evaluate and train top talent from the surrounding industries, you widen the talent pool, invite new ideas, increase the odds of top performers staying longer, and reduce costly turnover at your company.
Russ Riendeau is the founder of East Wing Group, Inc., an executive search firm and also a Vistage member/speaker on leadership topics. Russ holds a Ph.D. in developmental psychology. He writes about research in behavioral science and business-related issues. He can be reached at firstname.lastname@example.org.
Originally published: Sep 19, 2011