Can you spend your way through a sales hiring problem ?

Aside from being half decent at recruitment, I am quite a good singer. My
wife is appalling, but she has one Karaoke party piece and it’s “Big Spender”
by Shirley Bassey.

Being the biggest spender is a strategy employed by some sales leaders.

As my daughter would say, “it’s a thing”.

Some companies and some hiring managers believe that they can spend their
way out of a hiring hole. They put a fairly simple mental connection together
that if they pay more than the rest of the job market, then people will be
immediately drawn to the job no matter what is associates with it. They also assume that the quality of the people
drawn to those jobs will be higher than those that other employers are talking
to.

They are wrong.

Big spending is nearly always accompanied by a lack of “employer value
proposition.”

Recruiters and particularly contingency agency recruiters (other than at IRC
where our consultants don’t earn commission in order to focus them on client
care and advice) LOVE a big spender. A big spender makes big fees and
big fees mean big commissions – usually at an accelerated level that most
other industries really can’t comprehend. There is therefore an advantage to
being a big spender. The consultants will push the job hard to whoever they
can get involved. In house recruiters are not immune either. A big salary is
immediately shiny and appealing to so many people and so applicants will
come.

I don’t remember the last time I looked at the job that a big spender was
pushing and thought “wow that’s an amazing career opportunity for
someone”. What’s that phrase about if things look too good to be true? There
is nearly always something fundamentally wrong with the job. Maybe the
technology is ancient. Maybe the market is as flat as a pancake. Maybe the
business is in trouble and is hoping for a miracle (remember that £150K basic
salary is not £150K basic salary. It is £12.5K a month for as many months as
it is going to take to milk someone’s contact network and work out if they
can pull off a miracle). More than anything else it’s because the employer
is often subconsciously trying to put lipstick on the pig of a bad employer
value proposition. They probably don’t even know what an employer value
proposition is. They have never thought about it and so subconsciously assume
that “big money equals problem solved”. They think they will attract the best
of the best in the available market place.

They also assume that they will entice people away from jobs which they
are perfectly happy in, to come and work for them, simply by throwing raw
hard cash at the problem. That is incorrect. Happy people don’t leave jobs.
Let’s look at the basic maths. Say I am on an £80K base salary and I am
smashing it at work – I am over target most years which brings me into club
trips and accelerators. If a recruiter rings me and puts on the spiel about a
£120K basic salary job, am I simply going to up sticks and leave where I am
for the increase in basic salary? Am I going to walk away from my pipeline
that is looking pretty good? What about the colleagues who have become
close friends? Or the boss that I have a fabulous working relationship with?
The answer is a resounding no. Not when I am earning £200K a year with my
accelerators and I can see the next year stacking up pretty well.

Remember this fundamental fact about the candidate pool.

NO PAIN = NO CHANGE.

You may have heard that before. Somewhere in your sales training, perhaps?
Clients don’t replace suppliers they are happy with and salespeople don’t
change jobs when they are content. So when ‘The big spender’ throws cash
around, they are only attracting the same candidates that were in the active
market anyway. The ones who are in some kind of pain for one reason or another. We’ll talk
more about that later.

It’s competing on price at the most basic level.

Big spenders position the company and its employer brand as a price led
competitor in the job market. Smart candidates pick up on subtle messages.
They ask good questions about the extent to which the company is value driven
in its approach to its customers. They very subtly highlight that the company
is admittedly aggressive in its desire to win and that they are also prepared to
drop their trousers on price when they are in a competitive squeeze.

Smart candidates know what comes unwritten in the contract of employment.

When a big spender throws lots of money around, smart candidates know that
it comes with unrealistic expectations. Expectations become disproportionate
and the nature of the fundamental employer-employee relationship changes
past a certain tipping point. At £40K base in the tech sector, the employer
has to bring quite a lot to the party to compete in the job market. At an
£80K base its more about what the employee can bring. At a £140K base,
the employer doesn’t care what the employee has to do. They just want deals.
They don’t expect to have to coach the sales person. They don’t expect to have
to provide something as simple as a decent lead. They expect big numbers
and they expect them fast. Smart candidates with good track records who
are winning in their careers know that and are often clever enough to say “no
thanks”, or walk away.

The big spender attracts the wrong kind of candidates.

The big spender attracts candidates who are truly attracted to basic salaries.
They attract the most mercenary and most instant-cash focused candidates.
They often attract the ones who aren’t used to earning much commission
and who will be less tempted to do real due diligence on whether they can
earn the amount of money they aspire to each year. These out of proportion
big spending jobs often attract candidates who are used to moving jobs and
have naturally become less risk averse and more money orientated about their
career.

Often when we meet candidates who are in a dire position in their career,
they have moved jobs repeatedly. When you look deeply at their year-on-year
career moves it is because at some point they got sucked in by a big spender.

Let’s take this scenario as an example.

A candidate falls into the hypnotic trap of the big salary and the ego message
that comes with it. “I am a top person”, “I am on a serious salary”, etc. He got
the job having left a perfectly decent one (occasionally it happens) and went
out to a) buy a custom converted range rover, b) buy a new house or c) put his
kids into the local private school.

Now, after a year of living at that level anything less than a £120K basic salary
is an abject disaster and he really needs to earn some commission too. But he
finds himself in alien territory in his new role. He doesn’t get the support he
used to get. The product isn’t quite as good as the one he used to sell and he
has to do a bit of magic to pull off a deal. The marketing doesn’t exist, he is the
marketing department. The new job is hard, really hard. And lonely, because
he is the only sales guy in the UK reporting to someone in Paris or New York,
who in turn reports to the VCs, who are questioning why he hasn’t done
£15m of business after three months. Eventually, because the new guy hasn’t
pulled off a miracle, the VCs continue to apply pressure and because they are
grumpy in a board meeting, the global VP of sales, Francois sends a goat into
the desert so he can keep his own job. Now the candidate is out of work but
CAN’T take less than the massive salary he WAS on.

He hated that job but now he has to take another job with the same basic
salary. He has to find another big spender and do the whole thing all over
again. Except this time, he is a little less confident, a little less ebullient, and
it feels even harder.