, , , , , , , , , , , , ,

Credit: www.ministrybydesign.net

Image Credit: <www.ministrybydesign.net>

So Kris Dunn, the CHRO at Kinetix recently wrote a post on why counter-offers are a suckers play.

1. It was my first post so I tried to say too much, but I still think it’s a good read.I’ve already written a post sharing my thoughts on the counter-offer, 1 so I won’t rehash them again here.

With that said, Kris makes an interesting point about knowledge transfer. Specifically, he says that:

(the)…tendency to freak out over average people resigning means you haven’t institutionalized knowledge transfer and operational soundness. The knowledge is in the average person’s head and nowhere else

2. Anna Bares, Managing Partner of Altura Consulting Group LLC points at that the 50% spread present in most traditional salary ranges actually allows a company to pay up to a 20% premium over the (company determined) market rate by design.It’s is a chilling thought, but is true in both large and small organizations. 2

Often an employee that is neither a key creator nor major revenue generator (i.e. they work in a cost center like communications or HR) is the only person in a department that can do some critical task. The completion of the task may not make money for the business, but the work is important to its continued operation. Consequently, said business finds itself in a situation where it must pay a market premium to retain talent that isn’t contributing commensurate value.

I don’t personally think it’s the worst thing in the world to overpay someone in  3. I’m not just saying that because I’m in HR – sometimes an employee working in a cost center performs so far beyond the (company set) market rate that it makes sense to pay him/her at or even above the top of the range. This of course has the makings of a great post for another day…support or operations, 3 but I *do* think it’s tough for an organization to be forced to do so because no one else in said organization can do the work.

The importance of having a strong bench cannot be overstated. Credit: www.thevarguy.com

The importance of having a strong bench cannot be overstated. Image Credit: <www.thevarguy.com>

I see one of HR’s primary jobs as being the development of a strong bench for every critical position in its organization. This starts with HR business partners having talent talks with function leaders to identify the most important roles in each department, and ends with identifying and developing bench players to seamlessly replace incumbents in those roles in the event of a departure.

Companies that don’t have strong benches end up paying a significant wage premium over time to retain talent that doesn’t provide proportional value. Labor cost are often one of the largest expenditures in any organization, and one way to control these costs is to ensure counter-offer decisions are made based on replacement costs as opposed to out of necessity.

As always, I don’t have all of the answers. What do you think?

Please share your thoughts below.



If you have questions about something you’ve read here (or simply want to connect) you can reach me at any of the following addresses: 

SomethingDifferentHR@gmail.com OR rorytrotter86@gmail.com