It is inevitable over time that a valued team member will receive a substantial bid to work elsewhere. Offer in hand, they commonly inform the team leader of their intention to leave the organization. The leader must then decide whether they want to make a play to retain the talents of the team member and keep them in the organization.
Beyond appealing to their loyalty to their colleagues and their place in the future of the team, leaders typically have several incentives at their disposal to retain a valued team member. They can offer a promotion, a new title, expanded responsibility, or a competitive match to the bid they received from the competitor.
By exploring what is important to the team member, they can craft a package of incentives that has a chance to satisfy the team member and convince them to stay.
But before playing this retention game, leaders must come to terms with the implications for the rest of the team. When leaders begin negotiations with a team member who has declared their intention to leave, they signal to the rest of the team that one path toward better pay or responsibility is to seek an offer from a competitor.
After this pattern repeats itself with several team members over time, leaders unintentionally create a terrorist mindset within the team. Team members quickly learn that to get more, they must threaten to leave.
Leaders who believe they can cut a deal that remains confidential and undisclosed to colleagues underestimate the nature of informal communication within the team. While team members may not be privy to the details of a negotiated deal, they almost always learn a trade has been made and draw the conclusion that advancement occurs more rapidly after an outside offer. This is how terrorism becomes a norm inside an organization.
While some team members are just too valuable or important to allow them to leave without an attempt to keep them, the choice to negotiate must be weighed against the long-term consequences of the decision.
In the end, most team members with an offer will leave anyway, unless the bid to retain them is massive. That is because team members offered a pot of gold rightly wonder why they had to threaten to leave to realize their full value to the team.
It’s easy to say that good leaders don’t negotiate with terrorists and therefore don’t make counteroffers to talented team members who receive an outside bid to leave. To be sure, such decisions must be made on a case-by-case basis. However, the best leaders do their best to offer the responsibility and compensation equal to the value of any team member before they decide to look elsewhere.
In those cases where a team member receives an oversized bid relative to their contribution, the best call is to wish them well. Once established, the need for counteroffers undermines the commitment colleagues have to the team. Counteroffer terrorism is created in organizations by leaders, not by team members.
A Daily Dispatch from the Front Lines of Leadership.
