Companies in today’s ultra-competitive tech job market have a hard enough time just hiring top-tier executive talent. But now, they’re also having to deal with increasing “flight risk” – in which new hires turn down a job they’ve already accepted or, worse yet, join the company and then quickly jump ship for another position. As an executive recruiter, these are the situations that make you stand up and say, “What the hell? No, you didn’t just do that!”
We started seeing this a couple of years ago. But now it’s happening more often. Let’s explore some of the reasons why:
- The surging tech boom has created overwhelming amounts of opportunities. Quite simply, this is great market for execs with strong pedigrees.
- The sustained nature of the current job market (going strong since 2011) is leading some people to forget the core values required to really build a career in the technology community. They may think, “It doesn’t matter if I burn a few bridges, there are plenty of good jobs out there.” But they forget how small this community really is. …
- Recent diminished loyalty between employees and their employers has reduced the traditional stigma about changing jobs frequently. After all, in a world where everyone’s essentially a free agent why worry about jumping when a better opportunity comes along?
- Current employers, in the meantime, are working harder to retain or lure back key executives with ridiculous counter-offers, including crazy raises, promotions and perks, making it hard to pry them loose.
Bottom line, there’s such a war for talent these days that top candidates’ phones are ringing off the hook, and they’re likely to be fielding multiple job offers. That’s great for candidates perhaps, but a nightmare for companies.
In one instance we helped an early stage tech startup recruit a veteran exec who quit after just a few months to join a later-stage company that offered “a deal too good to pass up.” Understandable? Maybe. But it was also very selfish, and disruptive to our client, which had already invested a ton of time in the recruit, issued a press release and introduced him to the board and the rest of the team. The thing is, he knew what he was getting into when he took the job. We made sure of that. He shook hands with the key players, and then just turned around and screwed all of them. A stupid decision.
In today’s hot market candidates may have good reasons for considering a better offer, or having second thoughts about accepting a job. But they must keep in mind that reneging on a signed job offer can have serious consequences. For the jilted company, re-opening an executive job search can result in months of costly delay, since other candidates are likely to have moved on by then. It can also hurt the rest of the company’s management team, and its investors.
So before taking that step, new hires should remember that there may be later repercussions. Not the least of which, Silicon Valley is too small for that kind of behavior not to be noticed. And believe me, people who’ve been burned in this way have long memories, deep networks and loose lips.
Because the market for great talent is so thin, companies may be somewhat more forgiving these days of candidates whose career consists of a series of short hops. But that won’t last forever. When the market tightens up, as it inevitably will, companies are likely to be much less understanding.
For better or worse, executive flight is a reality that many companies and search firms are currently dealing with. Early-stage companies are clearly the most vulnerable to flight risk, so it’s especially important for them to take the right precautions during the recruiting process.
Here are a few ideas for how they can reduce the risk:
- Be an open book. Make sure the candidate is joining with a clear understanding of where things stand at the company. Don’t just be in sales mode. New recruits who aren’t well enough informed may decide the job isn’t what they expected and opt to pull the ripcord. Best to be brutally honest with candidates upfront. You will only hurt yourself in the end if you’re not.
- Set realistic expectations. Additionally, make sure candidates understand what it means to join a start-up. Some get excited by the concept and allure of joining something early stage, but underestimate the challenges that often come with that – such as products that aren’t fully baked, lack of infrastructure, support teams that need to be built out and the difficulty of getting access to customers with an unknown brand. They need to be ready (and hungry) for the fight it takes to ramp a company.
- Make sure the culture fits. The best way to ensure new recruits stick around is to be certain they’re a good fit with the company’s culture. It’s worth spending extra time during the hiring process to build relationships and ensure that both sides really get to know each other – maybe even doing a strategic planning session together. It’s essential to expose candidates to your culture and how the CEO and/or executive team operate. And if you don’t have a well-thought-out plan for how to articulate the nuances of your business and people, you’d better figure one out, and fast.
- Engage early. Some companies assume that once a job is accepted they can turn their attention elsewhere. But the hiring process isn’t really complete until the new executive is actually on the job and integrated into their new role. We suggest engaging with new recruits early – even before they’ve officially started – so they can start building relationships and excitement for their new gig. Because if you aren’t talking to them, someone else may be.
Consider pulling them into an executive staff meeting, or perhaps inviting them to an offsite social event. Don’t overwhelm them with a lot of operational details or problems. Keep it light. But you’ve got to welcome them, make them feel like they’re part of the team and that you are sincerely grateful to have them.
- Resign successfully. Part of my job is helping executives to get psychologically ready to change jobs, including guiding them in how to manage a successful exit from their current company. We coach them on how to handle the exit with integrity, while maintaining professional relationships, so that they’ll have good references, and won’t leave their old company in a lurch. We also do this to keep them focused on their new role and help to spot the early signs of flight risk, if it arises.
- Onboard effectively. Take the time to define and map how new executive hires will get integrated with the team. Create an environment that encourages the rapid development of peer relationships (both socially and professionally), and involves candidates with meaty initiatives as early as possible. Those first couple of months on the job are critical to long-term stickiness.
- Stay engaged. I believe a search firm’s job doesn’t end upon placement, it’s important to stay close to new hires. That’s why we usually call them, or meet for coffee or a beer after a few weeks to be sure everything is going OK. If we detect any issues or squirrelly-ness, we help the recruit sort through that real-time. And if things feel like they’re about to go sideways, we give the new employer a heads’ up so they can engage and respond quickly.
When someone is considering bailing on a new job, we always caution them to think long and hard about the consequences. That’s one benefit of hiring a search firm with a wide footprint and muscle. We do over 300 searches a year and it’s increasing. Candidates know that we are an avenue to exciting opportunities, and that maybe helps them to say, “You know what, this other opportunity is tempting, but I don’t want to ruin my whole network.”
Ugh, flight risk is a sobering topic to be sure, but one to be ultra-aware of in this crazy market we’re in. Don’t take things for granted!
# # #