One complaint I hear a lot about from company owners is the difficulty they have in finding and enticing management talent to join them. Typically when I ask what did they offer when they encountered someone they thought would be a great fit, the said something akin to “I could not afford them”. That was NOT the question I asked. I asked what did they OFFER. I didn’t ask “How much did the potential employee want”? Nor did I ask “What are/were they making at their current/former job?”
Human beings are all motivated by different things. Rarely is money the sole motivator. Actually, employee and management surveys have found other factors play a greater role. For management team members the ability and leeway to actually help guide the ship can be significant. A share in the profits or an equity stake is enticing. Greater involvement with employees is another one. A more flexible schedule allowing more time for friends and family is yet another. A large factor is challenging and rewarding work – the need to grow and contribute in the process. Small businesses can often provide benefits that corporations cannot.
Let’s take an example (similar to an actual case for a former client): You are a $5 million transportation firm. What can you offer that someone making $160,000 as a logistics director at UPS wants? You may only be able to afford to pay them $80,000 – roughly half of what they are making. You first approached them a little over a year ago when you could only pay them $40,000. They turned you down and said, “I need $120,000 minimum”. Now you’ve doubled in size you can double your offer but it’s still $40,000 too low.
(I’ll continue this example in the next post.)