With the return of markets and profits, the Forest Products Industry is staging a long anticipated, and overdue, recovery. It’s been a ride. The bench for top tier executives is shallow. Many long time, key executives, are close to retirement. Here are some key points to consider as you move towards replacing key executives, or filling out your team.
- STICKER SHOCK: If you haven’t gone outside recently, you will be surprised by current compensation levels. The market for talent is elastic. It is a pure function of supply and demand. The best executives command, and earn, the highest levels of compensation. Focus on the returns they bring, not how much they cost. The market is what it is. The best real time data on compensation comes during the course of an Executive Search. The information, and numbers, tells the story. Competition for top talent is fierce, and will remain so. The internet has made compensation transparent.
- CLOSING THE DEAL: Sumner Redstone, founder of Viacom, wrote in his autobiography that if you want to successfully conclude a negotiation, figure out what the other side wants, and give it to them. Negotiating an executive compensation package is complicated. Often times, the process falls apart over avoidable pitfalls. I begin the negotiation process from the first point of contact. People will tell you what they want and need if you listen. It’s not always about money. Find out what your top candidate wants, and do your best to include it in the offer. The process needs to be a win-win.
- MISTAKES ARE MADE, WE’RE ONLY HUMAN: We make mistakes. Hopefully, not too many, and not the same ones over again. The human animal is extremely unpredictable, making hiring and on boarding an executive inherently risky. I think we know if the hire was good within four to six months. Dealing with a mistake early is less costly, and more beneficial to all involved. Employees below, imbued with common sense, already know. Morale improves when Senior Management moves proactively to solve problems obvious to the rank and file.