Counter Offers

Don’t count on counter offers.

It’s a good feeling isn’t. You resign from your current job, and all hell breaks loose. Next thing you know, the boss is taking you out for lunch and sitting there with tears in his eyes telling you how important you are to the company, and how he had such high hopes for you and that you were like a son or daughter to him. He asks what he can do to make you stay, what if we could beat the offer the new company is making you, would you stay then?

Yes, it feels good. And so it should. There is nothing wrong with letting your ego inflate just a little. You are entitled to feel good about it, but lets just analyze the situation for a moment.


What has just happened here? It isn’t really that they can’t afford to lose you is it? If you think on it, it isn’t much of a company if that were the case. Personally I would be very worried to work for a company that absolutely could not survive without one person even if I was that person. What if that person was hit by a bus? What would happen to the rest of the employees?


So, the chances are that although it feels good to think you are irreplaceable, you probably aren’t. Thinking about it more carefully, you will find that it is obviously just very inconvenient for them to lose you now. They have been caught napping and suddenly the boss has realized that it isn’t likely that he can appoint a new person and have that person trained in your one-month notice period. So it is only natural that they will try to get you to stay (at least for a while longer).


So he must get you to stay. As a smart boss, he is likely to use some pretty intense tactics to accomplish this goal. He may appeal to your loyalty (you are like part of the family?), your ego (you are critical to the business?), your greed (how much are they offering you?), your naivety (we were just about to promote you?) or probably a combination of the above. When they get desperate, he may even try to scare you by telling you every nasty thing he has ever heard about the new company (especially if the company is a competitor).


But, you can’t hold this against him. He is only doing what is best for the company. What you need to do is look at what is best for you.


Lets just say that you do take the counter offer. What is likely to happen? It has been my experience that one or more these things happen:


1.The problems that made you want to leave the company in the first place are unlikely to change, unless the only reason you wanted to leave was for more money.


2.If it was the money, and they now give you a substantial increase, it would be wise to think this out very carefully. You need to analyse why they feel you are worth more money now? If they believed you are worth the extra, then why didn’t they offer you this increase before you resigned? (Maybe you should ask them to backdate this increase and pay you the difference for the last 12 months).


3.It only therefore makes sense that they are buying time. Again it comes down to the fact that it is not convenient for them to let you go now. If they can persuade you to stay they will do it, even if it costs them in the short term, but they obviously won’t let you catch them napping again. They are going to make sure that they have someone understudy you and then when this person is up to speed, but earning far less than you are, then what is likely to happen? Chances are they are going to make your life miserable in the hope that you will resign or they are just going to stop giving you the normal annual increases until your salary is once again where they believe it should be. The problem is that by this time the new opportunity is no longer available and you have let the new company down and they are unlikely to want to talk to you again. So if (you are lucky) and they haven’t been able to get rid of you, you are now stuck in a job where your boss believes that he is over paying you, so he is making your life unpleasant in the hope you will resign.


When you look at it this way, it is just logical. I don’t blame companies for making counter offers. It makes business sense for them. But from the employees point of view, accepting them is like shooting yourself in the foot. Ask anyone who has ever accepted one.






Beware of the counter-offer


Beware of counter-offers no matter how tempting they may be. You may feel flattered but you need to be aware of the pitfalls.


Be sure to ask yourself these questions:


1. Now that you are leaving, why now are you only now worth the increase?


2. Will my loyalty always be in question now that I have changed my mind?


3. Will you be the first to go if there are cutbacks in the future?


4. By accepting the counter offer, are you giving your employer some breathing space to see if they can source a replacement for you?


5. Most importantly, will your career stagnate now that you are getting more pay?


6. Will they give you more responsibilities now that you are getting more pay?


7. Will you have to report to a person you don’t respect?


8. Are you sure that you will receive a raise or bonus next year? (You can bet that the increase they just offered you will be recalculated and you can be sure that your next increase will be less than what it would have been).


9. Has the counter-offer been made to avoid a short-term inconvenience by your employer?


10. Will you be considered for promotions now that you have considered leaving?


Counter Offer Statistics


Some interesting statistics that have been tabled internationally with regards to employees accepting counter offers are:



1. 50-80 percent voluntarily leave their employer within six months of accepting the counter-offer because of unkept promises.


2. Most of the remaining employees that accepted counter-offers involuntarily leave within twelve months of accepting the counter-offer, they are either, terminated, fired or laid off.



3. As attractive as counter-offers may appear, they greatly decrease your chances of achieving your career potential


This was an article I found many years ago when I owned my previous agency, the statistics still ring true today.
 
melinda@hrcorp.co.za