In my earlier article on this subject, I argued that job counter offers are lame attempts to correct past omissions and are almost never successful. Either people don’t take them or they do take them and end up leaving relatively quickly thereafter. Along the way, they throw the rest of the organization off balance. Of course, they work every-so-once-in-a-while. But the odds of success are so small that you’re better off skipping the whole thing and devoting your time and attention to preventing the need for them in the first place. Those points are still valid, with some pandemic-inspired modifications below.


Push And Pull

There’s always a push and a pull when someone quits. People do not get offered jobs out of the blue. They may get contacted out of the blue. They may have a chance encounter with someone that leads to a conversation. But there’s always a conversation. And for that to happen, both sides have to be open to the conversation. That means something is not quite right with the person’s current situation. That’s the push.

The pull is the allure of the new opportunity.


New Market Reality

A counter offer is an attempt to adjust to a new market reality. Part of this is simple math. As people do their jobs they acquire knowledge, skills, experience, sensibilities and deliver results. Each of those increases their market value. Yet no organization fully recognizes and rewards each incremental improvement in real-time. Most give people some sort of annual review and salary adjustment. Some don’t even do that. The lag between accomplishment and recognition and reward creates a gap.

That gap creates an opportunity for others to come in and scoop up strong performers by recognizing and rewarding what the organization is going to recognize and reward, but has not yet done so.

The other part of this the differential rate at which organizations adapt to our changing world. The pandemic forced a jump-shift in ways of working. Some made the jump. Some are trying to hold on to old ways of doing things and old ways of treating their employees.

That creates a second gap that makes some organizations’ strong performers that much more vulnerable to other opportunities and makes some organizations’ counter-offers that much less interesting.


Knock On Effect

If you make a counter offer, others in the organization will question whether they are getting their fair share of recognition and rewards. Don’t fool yourself into thinking they won’t know about the counter offer. They will. And they’ll be more open to outside job offers even if just to prompt you to adjust to their own new market reality.

Coca-Cola’s agreement with McDonald’s is that no one will pay the Coca-Cola Company less than McDonald’s does in any market. This means that any special deal Coca-Cola gives a single-outlet start-up restaurant, must be given to McDonald’s as well. So, Coca-Cola’s compensation to McDonald’s adjusts in real time.

While you may not be as regimented as this, as you think about giving any special deal to any one strong performer you are trying to keep from leaving, you need to be prepared to give that same deal to all your other strong performers.


Damaged Goods

If someone accepts a counter offer, they’ll always be tainted. It’s hard to believe in anyone’s undying loyalty once they’ve told you they are leaving. However hard you try, you’ll always think of them and treat them differently. This makes them far more likely to be open to more conversations and to leave for real – relatively soon.


Preemptive Recognition

This is why you should invest in your strong performers first. Too many leaders spend so much time dealing with under-performers that they don’t pay enough attention to the people performing well until those people walk in to announce they’re leaving.

By then it’s too late.

Instead, treat your strong performers so good all along the way that they will not ever be “open to the conversation” about possibly leaving. Remember this is actually three goods:

  • Good for others: Inspire your strong performers with the good for others part of your mission or purpose.
  • Good at it: Do what it takes to get any barriers out of the way in the way you work that hinder your strong performers’ ability to do more of what they are good at.
  • Good for me: Ensure your strong performers receive the recognition and rewards they deserve. As your strong performers’ knowledge, skills, experience, sensibilities and accomplishments grow, make sure the person recognizing and rewarding their new market worth is you.


Click here for a list of my Forbes articles (of which this is #815) and a summary of my book on executive onboarding: The New Leader’s 100-Day Action Plan.


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