Today’s hiring landscape is a tough one. The 2008 recession eliminated half of the publicly-traded companies, and the frothy private equity market means that the PE partners are constantly seeking executives to run their portfolio companies. This demand has made negotiations much more fluid for executives and they hold a stronger hand than they have held in the last decade.
Many benefits typically included in executive compensation packages were eliminated during that time, but today’s war for talent has put many of them back on the table. Executives who seek CEO roles in PE are primarily attracted by having an equity stake that could result in a big pay day, but greater cash compensation certainly sweetens the deal.
Candidates for these roles now need a new set of negotiating skills. That is why we built a customized team of exceptional people to support and guide clients so they can negotiate the best possible compensation packages. The team typically includes an Advisor who has helped negotiate hundreds of contracts for our clients as well as an employment lawyer who knows the legal ins and outs. But that’s not all. We also have a senior research analyst who conducts a compensation study to compare a dozen peer companies and roles to ensure that our client’s offer it at or above market value.
We find that business leaders known for hard-nosed negotiations when it comes to their companies often find it challenging to negotiate their own employment terms. More often than not, they don’t realize that they are leaving money and benefits on the table. We know the points of leverage in an offer that make the difference in a below average or a generous compensation package. And these negotiations are handled in a way that protects the relationship going forward.
Believe it or not, companies want senior executives to push back because it demonstrates that you will also negotiate aggressively on behalf of the company. These back-and-forth discussions become part of the interview process and instill confidence about the new leader before you even walk in the door.
Not to state the obvious, but although markets are strong today there will be a tipping point. There are things you can control, but every executive and company is buffeted by outside forces. Negotiate aggressively while the good times last.