5 Ways to Compete in Today’s Talent Market
Andrew Henry | November 17, 2021
The amount of private capital raised and the associated deal activity in today’s market have served to create a candidate-driven talent market. Proven Operators open to considering new roles have found themselves with multiple compelling options to consider simultaneously, while companies continue to compete in the ever-escalating war for talent. How to successfully compete and win in today’s talent market is on the minds of hiring authorities across the Private Equity realm.
In executive search, our teammates are on the ground every day navigating the landscape of unrelenting deal activity and competitive offerings with both clients and candidates. Here are some of the best practices we’ve implemented and lessons we’ve learned as market competition for top executive leaders continues to accelerate.
Setting Appropriate Expectations & Minding the Clock
It is a candidate’s market. With top talent experiencing a robust pipeline of competing offers and counteroffers, it is critical that at the onset of the search process all hiring authorities understand the realities it takes to compete in today’s market, particularly around the required pace of a selection process, candidate “shelf-life” and competitive compensation.
“At the beginning of a search, design the process for speed and efficiency. We can accelerate the process by defining all process steps, developing equity illustrations, thinking through compensation scenarios in advance and identifying ways to accelerate the process when a compelling candidate is brought to the table.” – Hayden Tewell, Partner – Packaging & Plastics
The impact of market competition has been substantial. For example, a strong economic offer a year ago may be under-market today. Likewise, a time gap in process steps may create a window of time for candidates to withdraw and accept a competing offer. By setting expectations around compensation and timelines at the outset, clients and recruiters can better align with candidate needs.
Do Not Shortcut Diligence
The right executive hires will have a substantial impact on a company’s value creation. Getting the right talent is a significant part to ensure the goals of the value creation plan are achieved.
“While it is critical to move quickly or risk losing a candidate in the presence of competing offers, this is a long-term decision for both the employer and the candidate. Taking time to execute proper due diligence should not be overlooked by candidates or clients.” – John Marshall, CEO
Define the critical path for your executive selection process and stay true to it – even as you move the process at-pace. Completing all process steps, from vetting to interviews, assessments, referencing and offer terms should not be short-circuited.
Build Trust & Encourage Transparency
It is commonplace in today’s market for top talent to be engaged in multiple hiring processes. It is critical that those working most closely with the candidate operate with transparency to foster equal information sharing as it relates to these competing processes.
“Staying connected to candidates is vital. For top candidates there will be competitive offers, new opportunities or counteroffers that emerge throughout the hiring process. Companies do not like to lose top talent and will do everything they can to compete for it. Being transparent with the candidates and asking them for the same transparency is crucial.” – Jamey Cummings, Partner – Cybersecurity
Information transparency can include: Does the candidate have the offer in hand? Is relocation required for the competing offer? For which role is there a stronger development opportunity? Understanding where this opportunity stands regarding timing, long-term opportunity and alignment to motivation will help determine if a candidate is seriously engaged in your opportunity. A candidate’s unwillingness to disclose even high-level, directional information on other processes can often signal the candidate’s level of trust and engagement. Assessing a candidate’s level of engagement in your opportunity can be a key factor when deciding whether to accelerate or decelerate an interview process for that candidate.
Go Beyond the Basics to Know the Motivation
While compensation must be in alignment with the market and with the candidate’s requirements, it is the tangential things that can make or break the outcome. Factors such as relocation, commute, team, succession, and timing of a liquidity event may hold far more weight when evaluating an opportunity.
“It is important to thoroughly understand a candidate’s motivation and keep it at the forefront of the process. The smaller factors will emerge as the heavy weight in a competitive scenario.” – John Hildebrand, Founding Partner
Diving deeply into a candidate’s motivation and their competitive offerings is necessary to compete in today’s market. Every executive is different, valuing location, upward mobility, impact, challenge, risk, and other factors at varying degrees. Understanding how each candidate’s specific motives align to the opportunity will enable recruiters to better navigate clients through hiring and offer processes.
Know When to Vet and When to Sell
Hiring teams should be poised to sell the opportunity early in the process as they work in parallel to complete their diligence on a candidate. Engaging additional team members whose experiences, roles, and perspectives align with the candidate’s motivation and enhance the candidate’s discovery process regarding a new opportunity can increase the likelihood of wining in a competitive scenario.
“Clients need to know when to vet and when to sell in a candidate market. Focusing on candidate motivation is critical to selling the opportunity, building the relationship, and engaging the candidate. If you are not selling the candidate as to why this is a compelling situation, trust me, your competition is.” – Bob Sargent, Founding Partner
What is the long-term financial opportunity? What is the path to the next step? Who will I work with? What has been the experience of other Operators who have worked with this equity sponsor in the past? Questions like these are top of mind for many executives exploring new opportunities and must be top of mind for hiring authorities seeking to engage theses executives.
Today’s market is highly competitive. Across functional areas, industries and geographies, talent is at a premium. To navigate today’s market clients, candidates and recruiters must work collaboratively throughout the hiring process. By remaining transparent, aligned, and future focused, employers can successfully compete for talent, candidates can find the opportunity that best matches their motives, and long-term value can be achieved.
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