No Need to Starve for Top Talent: Lessons on How to Eat Cake

[TalenTrust LLC]

“With all the attention paid to executive compensation – the shift to stock options and the huge packages that have become commonplace – surely, we thought, the amount and structure of compensation must play a key role in going from good to great. How else do you get people to do the right things that create great results? We were dead wrong in our expectations.”
Jim Collins, Good to Great, 2001


It’s no wonder companies have trouble finding and keeping top talent when even the business experts didn’t know until recently that compensation isn’t the biggest motivating factor after all. Not that compensation is irrelevant; it needs to be competitive. But it’s only one of many things people consider when deciding whether to accept employment with your company, or whether to stay.

How do you keep from starving for top talent? In our experience, it’s by understanding and satisfying what motivates your candidates on both professional and personal levels, by being honest and direct about your company culture, and by treating people well. Following are trends we’re seeing in today’s talent marketplace and strategies for making sure your company is the first choice of the right candidates.


The Winds Are Shifting to a Talent War

The job market is improving and senior execs are weighing their options, according to ExecuNet’s 2006 Executive Job Market Intelligence Report. ExecuNet estimates that 7 in 10 executives will be considering new opportunities in 2007. They found that both search firms and corporate HR professionals agree – overwhelmingly – that there is a shortage of executive talent. The U.S. Department of Labor projects that 10 million jobs will go unfilled between now and the end of the decade. These factors mean that you may find yourself in a talent war to keep your best people and attract new ones.

In their report, ExecuNet found that compensation not only ranked low on the list of reasons executives leave jobs (5%), but also that it is no longer the primary motivator in making new career decisions. Lack of opportunity for personal growth, external factors limiting company/industry prospects, cultural mismatches, and work/life balance were listed higher than compensation on the list of reasons executives leave.

So how do you use this information to win the war?

Attracting Talent with More than Cash

I don’t want to underemphasize the importance of compensation. Salary is an emotional number, and executives expect that they will be paid fairly and at current market rates, or more. They still want compensation packages that include bonuses, stock options, and supplemental benefits. The point is that offering generous amounts of all these benefits is not enough in today’s market. Here are some strategies that will help you differentiate your company and win a competitive edge:

Build a solid reputation – an employment brand. A candidate’s first exposure to your company is probably your reputation, and people are more likely to be interested in you if they’ve heard of you. Do you have a presence in the community or in your industry? What is the market saying about your company, its mission, performance, culture, and leadership? Examine your company honestly, correct glaring shortcomings, and pursue a public relations effort to become better known.

Don’t fluff up your company. Tell candidates the truth about your culture, what it’s like to work at your company, and what they can expect in terms of development and opportunity. You may convince a person to work for you by padding reality, but both the company and employee will lose in terms of performance and longevity if expectations aren’t met.

Find the needle in the haystack. What motivates this candidate or employee – what does he/she want from your company, this job? Is it leadership challenges? Professional development? Personal growth potential? A culture of work/life balance? International opportunities? Less travel/more travel? What makes them want to come to work? What turns them off? When you understand what a candidate truly wants, you’ll know if you can provide it – and make your hiring decision accordingly, or find a way to accommodate the need.

Begin your retention efforts on day one. Relatively few companies have executive-retention plans in place, making their people highly vulnerable targets. Recognize, reward, challenge, and appreciate your executive talent (and all employees) from the moment you come to an employment agreement. Don’t wait until they begin looking for greener grass. Establish an assimilation plan and knowledge transfer system now, before you hire, to ensure a positive, confident start on both your parts.

Treat your people well. Workplace stress and work/life imbalance are causing more and more people to leave their jobs. Many companies are overcoming outdated skepticism about flexibility in the workplace to create environments that minimize stress and allow a successful blending of personal and work lives. Study after study, book after book, have shown that the highest performing, most successful companies find a direct, and positive, relationship between flexibility for employees and the bottom line.


As one senior executive put it, “The ability to blend my personal and work lives is the difference in arriving at work being happy, enthusiastic, and full of gratitude as opposed to being rushed, angry, and unfulfilled.” Think about how these demeanors filter down through an organization, executive by executive, impacting the attitudes of every employee. Whether or not you win the talent war will depend on all the ways you find to say, through compensation and environment, “This is how valuable you are to our company.” Achieve that and you’ll never be starving for talent.