Closing the Deal: Making Offers That Are Accepted

After a long search, Jim, the CEO of a start-up, finds the perfect candidate to fill an important executive opening. The candidate, Susan, has the right skill set and excellent chemistry with other members of the executive team. She's excited about the job and the company. Her acceptance is all but certain.

Jim needs Susan to start as soon as possible. He hasn't talked with Susan about what she expects in an offer, but he knows what she is earning now and what he can afford based on the salaries of the other members of his team. He puts together an offer he thinks is attractive and has Human Resources overnight it to Susan. He calls the retained search consultant to give him the good news. Finally the search is over!

Two days later the offer is rejected. Both parties are too frustrated to salvage the deal. What happened?

A significant percentage of companies do only a fair to poor job making offers. In the worst case, this results in offers being rejected, higher recruiting expenses, and important jobs going unfilled. Even when the candidate accepts, mis-management of the offer process can mean she begins work with a bad taste in her mouth instead of unreserved excitement.

Get It Right

How do you make offers that are accepted?

• Involve your retained recruiter. If you are using a retained recruiter, you are fortunate to have expert advice and help. Involve the recruiter in every step of the process, and carefully consider her advice. Above all, use the recruiter as an intermediary for presentation and negotiation of the offer. Having a buffer between you and the candidate can keep things cool if negotiations get off-track.
• Romance the candidate. In other words, keep selling the candidate throughout the process. Make sure he knows how much you want him to join and what a big impact he can have on the company. This can be just as important to the candidate as money. Consider taking the candidate to dinner, flying the candidate's spouse in for a visit to the area (if the candidate is from out of town), or just making an encouraging phone call.
• Ask the candidate what she wants. If you want to know what it will take to get your candidate to say yes, ask her – the earlier in the process, the better. You don't have to match her requests, but this will tell you if you are in the same ballpark.
• Don't let your company's internal salary structure be the sole determinant of your offer. Your offer must make sense for the candidate and should reflect the market for this job. If your company's salary structure cannot accommodate the candidate's needs, you should be looking at less pricey candidates.
• Have reasonable expectations. Entrepreneurs are passionate about their companies and the exciting work they are doing. But don't expect a candidate to accept a sub-par offer just because he has a chance to work with you. The best candidates expect and can demand exciting work and competitive compensation.
• Don't lowball the offer. Negotiate in good faith. Bare knuckled, lowball negotiating tactics might work if you are hiring unskilled labor for the local meat-packing plant, but they never have a good outcome when used with executive-level candidates. Usually candidates throw up their hands in disgust and walk away. In the rare instances where these negotiations are successful, the company almost always has to raise its offer to a level that makes sense, leaving the candidate with a diminished opinion of his new employer. As a rule of thumb, if you have to raise your initial offer more than 15 percent to get an acceptance, you started too low.
• Expect negotiation. You should expect some negotiation of your offer. If the initial offer was reasonable and your recruiter is acting as an intermediary, issues should be fairly easy to resolve.

It's Not Over 'Til It's Over

Creating, presenting, and negotiating a job offer is like running the final two miles of a marathon. If you do it well, you will complete a successful race. But screw it up, and the prior twenty-four miles of effort will be for nothing.

Summary

Never assume you have completed a hire until you have an acceptance in writing and the candidate's present employer has accepted his resignation. When making an offer, use common sense, try to appreciate the candidate's point of view, and treat the candidate as you would like to be treated. If you do, the odds of getting an acceptance are high.