Beyond Compensation: Headhunter-Proof Your Team

It's that time of year. Below is an updated version of the original article published in March, 2018.

As an executive recruiter, I exist to create the very disruption this article aims to help leaders avoid.?Curious right??Readers may understandably wonder about my motivation.?

I assure you, it’s a love of writing about topics I find personally interesting and of service, rather than penance.?In addition, my highest goal for the candidates I place is for them to enjoy long, productive tenures, contribute to growing the businesses they join, and, ultimately, become clients. So we share the same goal – building and sustaining a top performing and engaged team.

For context, I spend my days creating and executing the strategy that will identify and attract the very best talent possible for my clients (hiring firms).?

Most often, this talent appears well entrenched and happy in their current role. They work hard, get paid fairly, perform well, and are often considered a culture carrier within their organization. On the surface, everything seems great.

Until my outreach presents this talent with a compelling opportunity, any thoughts of leaving were often tucked safely in the way back of their mind.?

What inspires a top performer to accept a recruiting call from someone like me?

Within the niche I specialize - building client-facing teams for institutional investment managers - the research I've done supports my anecdotal view of just how committed these professional are to their current situations.

When asked “How would you characterize your current state of mind?”?

5%????????are unemployed and actively looking

21%??????are employed and actively looking

59%?????are not looking but open to considering new opportunities

15%??????are firmly not open to considering new opportunities?

Put another way, if the Head of Distribution at XYZ Investment Firm looked around and randomly selected ten individuals on their team, six of them would be quite open to receiving a phone call from someone like me.?A few would be actively reaching out, and only one or two would be fully committed.

Taking a broader view, Gallup’s State of the Global Workplace Report (2017) showed that employee engagement is challenged across all industries and geographies. For example, in North America, the region with the highest level of reported employee engagement globally, only 31% of employees reported feeling engaged in their work.

Chances are, your employees are currently sitting somewhere along the continuum of not bringing their best selves and talents to work every day and being a legitimate flight risk.

Too often, the warning signs go unnoticed (or unaddressed) as managers focus on navigating their ever complex and expanding responsibilities.?

At the final stage of a recruitment process, I often ask candidates “how will your manager react to your resignation??Will they be surprised?”?Almost always, the answer is “yes.”??Occasionally, the candidate will have flagged frustrations or unmet career aspirations with their manager, but usually they haven’t.

Too often, the first sign of a problem (or acknowledgement of its seriousness) is an employee walking in with letter of resignation.?

Barring a successful counter-offer (with its multitude of complications) the situation is typically too far gone to salvage at this point.?

Professionals are not exempt from getting this wrong, even yours truly.?

Many years ago, I walked in to my manager’s office holding a resignation letter, full of confidence, excitement and conviction.....and promptly burst in to tears. I clearly didn’t stand a chance against a counter offer. I loved the people I worked with and had been instrumental in building our practice.

I didn’t really want to leave, but there were many things I wanted to change.

My manager did the smartest thing he could have done. He challenged me to put that list to work and take personal ownership over driving change where I had influence, convinced me to trust him to fix things where he could, and encouraged me to let a few things go.?

With the benefit of this personal experience, I encourage friends and candidates alike to have these difficult conversations before the level of frustration reaches the stage of a resignation.???

With so much available research and guidance on employee engagement, why is this opportunity so often missed? Why is it so easy for an executive recruiter to capture the attention of even the top performers??

Because, as the saying goes, common knowledge isn’t necessarily common practice.?

In my experience (and research) the top motivating drivers for changing firms are:

• Opportunity to build and grow an effort
• Culture and people
• Opportunity for career advancement

Notably, compensation ranked fourth.?

The Jerry Maguire scenario of headhunters or agents bidding star performers away with money does happen, but it’s much less common, especially in the current environment. As long as candidates are paid fairly, compensation is rarely the key driver.

In any case, salespeople rarely express satisfaction with their compensation. This isn't just perception - in my research, I've quantified both their view of how well total comp met expectations and how well it reflected their contributions to the firm. The feedback was noticeably pessimistic for such an otherwise optimistic population, but that is a separate article.

This is funny but it's not really true.

Compensation is not as strong of a recruiting or retention level as one might assume.

In reality, the candidates I work with are most excited by opportunities where they can best leverage their strengths to build and grow something, and where the impact of their contribution is visible, meaningful and valued.?Where they feel the firm respects both the marketing function and the individuals within it. Of course, money is one manifestation of that respect, but so are many other things. Top performers want to be surrounded by people they like, trust and respect as well.?And they want to feel as though they are growing in their careers.?

Quotes I hear on a daily basis:

“I’m not interested in going to be a cog in the wheel somewhere”

“This place is so dysfunctional and I’ve had it”

“I've reached the stage in my career where life is too short to work with *****”

Conversely, I also hear “I’m really happy here and not open to a move, but would love to try and be helpful with recommendations.”?

How can you ensure members of your team fall in that latter camp??

Across the board, employee engagement notably increases in companies with a strengths based culture, where managers regularly communicate, and work with their teams to set and achieve clear performance goals.?In recent years, linking an individual's values to a company’s broader purpose has taken on increased importance, as have community involvement and support for integrating one’s professional and personal lives.

As an executive recruiter, I work with senior, experienced professionals. As one’s career progresses, those operating from a position of strength seem to have less tolerance and patience for sub-optimal situations.

Yet, I have noticed similar sentiments expressed by Millennials and Generation Y far earlier in their careers.?These “up and comers” seem born with a level of existential clarity on values, balance and purpose that Baby Boomers and Gen Xers only begin to contemplate later, as they approach and move further in to mid-life.?

What does this all mean for managers committed to retaining and motivating their teams?

Moving beyond the conceptual, consider the following specific ideas:?

• Celebrate wins big and small; take time to amplify successes
• Take metrics from the annual performance review and break them down in to smaller goals and objectives; hold a weekly meeting to discuss progress and challenges
• Create a relationship of mutual accountability. Rather than focusing solely on a team - member's KPIs, put metrics and accountability around what you as a manager commit to them (opportunities for advancement, compensation, resources etc.)
• Seek out opportunities to provide team members with ownership and autonomy; this is often critical when trying to protect a #2 during the “in between” stage where they are ready to step in to a more senior leadership role but a spot (probably yours!) isn’t readily available?
• When rolling out new initiatives, consider instilling a spirit of competition and using incentives that reward engagement vs. shaming (particularly publicly) for non-compliance
• ?Link an employees’ individual contribution to a greater purpose (for example – an investment funds’ returns fueling a college endowment that increases the number of scholarships offered)
• Transparency – involve your team in decisions, even going beyond information sharing to giving them a voice or vote wherever possible?
• Acknowledge and openly discuss sensitive topics vs. avoidance; in the absence of information, I can assure you, your team is not assuming the best; they are calling me
• ?Demonstrate a respect for your team's time and resources (e.g. save weekend emails as drafts vs. clicking send, avoid fire-drills and consider commitments thoughtfully before offering up promises that your employees will then need to deliver on)
• Uncover what drives employees on an individual level and work to ensure their role and career path satisfy these intrinsic motivators
• Consider the power of social influence. To the extent possible, surround your employees with others who exhibit the characteristics and habits that lead to top performance in your industry

The ideas above aren’t new or earth shattering.?

But are they common practice in your role as a manager??

Where are these practices on your calendar??

What would your team say?

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Laurie Thompson is the founder of Willow Hill Advisors, a retained executive search and career advisory practice she launched in September 2019.

With nearly 20 years of experience serving the financial services community, Laurie helps traditional and alternative investment firms build and sustain top performing institutional client-facing teams.

Prior to launching Willow Hill, Laurie spent 16 years in the financial services practice at Heidrick and Struggles. She started her career working with two boutique executive search firms and a year in fundraising and development with Big Brothers Big Sisters.

With an academic background in Wellness Management (M.A. Ball State University, 1998) Laurie enjoys contributing her unique perspective on personal and professional development through her executive search work, career advisory coaching and speaking engagements.?

For a full overview of Willow Hill’s thought leadership, executive search and career advisory offerings please visit https://willowhilladvisors.com/