It might seem counterintuitive to think about your resignation or exit interview at the very start of your job search. However, failing to know what might be done to try and keep you can cause issues later down the line and adversely take from your relations, time and even obscure your ability to make an informed decision upon receiving a counteroffer.
Let's use a recent example of a counteroffer situation for a valued Tax Manager (in-house):
Over the last month, Joe has undergone a 4-stage process. Joe’s Head of Tax has allowed him to have several half-days for ‘dentist appointments’, ‘airport trips’ and the like. It paid off because excitedly, Joe accepts a great offer for a company and role which really ticks their boxes. While excited to join their new company, Joe is nervous for ‘resignation Friday’ as they have a great relationship with the Head of Tax, and Joe has no idea how it will be taken. Joe would also be keen to minimise their notice period; however, the busy season is coming up and Joe knows that without their support in what is already a small team, workload demands will be too high.
Joe’s resignation catches the Head of Tax by surprise. He reacts emotionally with a near-refusal. The Head of Tax composes themselves over the weekend and then sits Joe down. He says he does not want to lose Joe and asks, “what can we do to keep you?”. Joe has a transparent and cathartic discussion, venting what made them look elsewhere. The Head of Tax thanks Joe for the insight, and with a laugh of relief says he had no idea these problems existed. The Head of Tax assures Joe that now out in the open, all the highlighted issues can be fixed. However, he can’t put together a counteroffer or new job description overnight, so asks Joe to delay their resignation by just a week or two. Joe explains that this is not possible, as the countdown needs to begin for their (already 3-month) notice period and their new employer cannot wait any longer.
Four weeks later, the Head of Tax comes back to Joe with one hell of a counteroffer. He has sponsored Joe to the C-Suite and upped their base salary by £30,000. He promises to gradually redefine Joe’s responsibilities over the next year and get them involved in new projects to tee Joe into the Head of Tax role. Moreover, the Head of Tax promises to be more attentive in the future to address such issues right away. At this point, the shiny excitement for the new company subsides and Joe struggles to even remember their original reason for leaving. Now, Joe is back to the stress of deciding between two offers once more, and everybody is looking to him for an answer.
What went wrong here?
Most companies do not ask “what will we need to do to keep you?” every day. Pretty much exclusively, this question is reserved for resignations or exit interviews when a counteroffer is being formed. However, asking this crucial question so late in the game raises several issues, regardless of which route Joe chooses.
1. The trust with Joe’s Head of Tax has been tarnished.
If Joe decides to stay, there will likely be an almost too friendly relational strain in future. Their boss might be always smiling, happy and attentive because they’re not 100% secure that you’re going to voice issues right away or stick around in the longer term. Equally, If Joe follows their decision to leave, they need to maintain good relationships with former colleagues – ideally, this includes not needing to have deceived previous line managers!
2. Joe has wasted time.
If Joe accepts the counteroffer to stay, then they have invested the month on interviews and preparations, days off and energy into a process which led nowhere. Equally, if Joe stays true to their decision to leave, they have given their boss no time for succession planning/interim support to get them through the busy season, meaning Joe will likely be held to their full notice period.
3. Joe has stakeholders depending on them, with reputations on the line.
Joe has one team who is keen for them to join and one team which understands them as leaving. Joe also has two line managers who are counting on them for upcoming demands, with no backup resources in place. Additionally, Joe has a recruiter network where lengthy and in-depth conversations have taken place on why this is the right move for them. In this situation, whether Joe stays or goes, they will be letting people down.
4. The emotional involvement makes it difficult for Joe to make a clear decision.
As Joe’s boss didn’t see the resignation coming, it is difficult to tell which counteroffer promises hold weight and which are fuelled by emotion/desperation for having no ‘Plan B’ in place. With an accepted offer and a tempting counteroffer on the table, whether Joe stays or goes, they will have the uncertainty when looking back and asking the question “what if…?” – a question often coupled by regret.
How can we avoid all of this from the start?
Here are three calls to action to manage counteroffers from the start in a way which keeps the trust with your boss, makes the most of your time, manages stakeholders and helps you make the right decision:
1. Know your RFL – and never lose sight of it.
Defining your RFL.
Any recruiter worth their salt will build a working relationship with your reason(s) for leaving (RFL). Your RFL will fuel your motivations for joining the next employer. Of course, it might be the case that you are not actively looking. Perhaps the thing(s) you would change about your work are not substantial enough to warrant a full-blown search elsewhere. In instances where you have been headhunted for example, you may not feel like you have a fundamental RFL. However, your interviewer will want to know what prompted you to consider a new role in the first place (which will be taken as the same).
Get your RFL on paper.
It might be the case that after receiving your initial headhunt call, just one aspect of the opportunity seemed interesting or shiny compared to your current role. However, after completing three rounds of company research/interviews, the differences between the roles may be sizeable enough for you to have an entire list of ‘pros and cons’ between your options. At this point, realities can become a little blurred as to why you were prompted to look externally in the first place. A good CV will briefly detail your reason for applying, so framing your RFL in relation to this could help you reflect on this later down the line.
2. Consider your counteroffer before resigning.
Know what you would need to stay.
It is wise to be realistic about your pull factors and what your boss would need to do to keep you. Either your boss can change what you need, or they cannot – it really is that simple. If your boss can do something to keep you, then it makes sense to pitch for the change(s) before investing in a lengthy selection process and resigning (perhaps unnecessarily). If your boss cannot remedy your RFL – ask yourself what you will lose by giving them the chance to try? It might be that your company can sponsor your case to change things in a way you did not anticipate.
Get time on your side.
As we can see in Joe’s case, counteroffers routinely take time to conjure. It might be that your boss does not have the power to change the structure, budget, or whatever your RFL is overnight. However, it may be the case they will stick their neck on the line to sponsor your case to their boss, the CFO and HR – which can take time. Assuming you are on a 3-month notice period, tendering an unanticipated resignation might mean you only receive a counteroffer 2 months-in. By this point, you’ll have your industry reputation on the line with external ‘Heads of’ who are looking forward to having you on board.
Bite the bullet.
Depending on the situation, requesting change(s) to your employment terms may seem an uncomfortable conversation to have. However, if we compare this conversation to the one you would be having if resigning without giving your boss the respect/opportunity to change things, then it becomes a walk in the park. Of course, you might not accept an offer elsewhere and so may not need to resign at all. However, by having these conversations in advance you might be able to fix the snags which had you interviewing elsewhere in the first place. Avoiding the topic of desired change(s) will not make the topic go away when resignation time comes, so best not to make excuses and bite the bullet.
Take the emotion from the situation with a transparent counteroffer.
Whether you believe you can be kept or not, voicing the need for change(s) will mean less surprise for your boss when resignation time finally comes. This ‘unsurprised boss’ scenario brings several advantages by fundamentally removing the emotion from the exit interview. For instance, asking for change(s) without a resignation means you can assess the capacity for change (this is the counteroffer before resigning) with greater transparency than when promises are fuelled by shock or desperation.
3. If you consider a counteroffer – consider your original RFL (not the money!)
Bet on receiving a salary-based counteroffer.
Overall, tax is a candidate-scarce market. Depending on your seniority level, finding the successor for your current position could cost your employer tens of thousands in search fees alone, before considering the time and resources spent on managing the interim. With these costs in mind, for your line manager not to try and tempt you into staying with an increased salary might indicate that something was not quite right in the first place.
An increased salary might help the cash in your pocket – but set back your career.
Providing a financial solution to a non-financial problem means that your original RFL will inevitably pop up again down the line (perhaps sooner rather than later). Let’s say for instance Joe settles for the whopping counteroffer of £30,000. After 6 months, Joe’s initial RFL will inevitably rear its ugly head once more. However, at this point, Joe’s “higher than market rate” salary will have priced them out of the market compared to other candidates at the same level. From here, Joe has the option to either enter selection processes where other candidates had seemingly progressed faster (who are cheaper), or Joe will need to take a considerable pay cut (which can raise warning flags to some employers right away).
The bottom line
Considering counteroffers after resignations are tendered often results in a no-win situation. Practically, however, if you’re reading this, it is likely the case that you have progressed with interviews already. My advice in either instance would be to avoid the hastiness of thinking “there’s nothing my boss could do to keep me” and be realistic about your pull factors. Biting the bullet now to have conversations with your line manager on necessary changes will save time, energy, reputation and clarity upon making an informed decision.
The question you need to ask yourself if considering the counterproposition is “what will fundamentally change about my employment and how will this remedy my original reason for leaving in the future?”. Unfortunately, the bottom line is that generally, counteroffers do not work. Typically, we hear from candidates who accept a counteroffer within 3-6 months once their initial reason for leaving pops up once more. Near-exclusively, these people regret not making the move previously when they find that an increased salary/false promises left them in a less favourable position from when they started their search.