The counteroffer argument is weak and simply not true. And it led me to think that this Guthrie guy seems to believe that the only way of people leaving a job is looking for another one.
This is particularly not true inside the tech industry: good employees are constantly harassed by other companies. They will offer higher wages, shorter hours and tons of other benefits to make a wanted engineer turn. Sometimes those offers are hard to turn down, even if you are pretty happy with your job.
What I've seen happen to me and friends is a simple matter of chosing to be honest or not. Last time it happened to me I sat down with my boss and told him:
- Boss, these guys want me pretty bad, they have been harassing me for months now and I turned down every offer. Problem is, they gave me this X offer now and, taking into account that I'm getting married next year, the extra money would be handy, this is getting hard to say no.
He gave me a counteroffer and we lived happily ever after.
Bottomline: sometimes the employee does not really want to leave, but it's a tough market out there. If you want to keep your engineers (and other employees as well) you simply have to be a better workplace than the others. This includes money, benefits, hours, bureaucracy, stress levels and every other possible aspect that your employee might take into account.
It's not really that different than building a product which is better than your competitor. Problem is that H&R and Hiring guys want so bad to make a case for themselves that they try those magic and golden rules that simply won't work.
You are dealing with people, be nice to them and they will be nice to you in return. If they don't, you don't want them in your ranks anyway.
That sounds kinda odd to me. If they haven't interviewed you yet, why are they making specific offers? Or is it really more like "We are willing to pay up to X for the right candidate"?
If they are making specific offers to people who haven't interviewed with them, that smacks of desperation to me - maybe there's a good reason why they're having so much trouble hiring that they have to pull these stunts.
If you go to your current employer with a "We are willing to pay up to X for the right candidate" offer, then they have plenty of excuse for ignoring it if that's what they care to do, so it doesn't seem to have much value over just asking for a raise if you want one.
The real bottom line of that point was that interviewing with other companies is kind of a pain, and employees generally won't do it unless they've already decided they want to move on. Other companies usually don't give specific offers before a round of interviews, so by the time your employee has an offer in-hand from another company, it's too late to be making counter-offers. Better to both do your best to watch the market and give raises that match the market, rather than just cost of living, and to cultivate an environment where unhappy employees will be comfortable telling you why they're unhappy before they go looking for another position.
The problem is that on average, giving every employee what they want in terms of salary, work allocation etc. is going to be hard or impossible. So most companies don't and usually the squeaky wheel (or the wheel that is threatening to leave) will get the grease. It is not fair but then there isn't a totally fair way to deal with this.
There is no fair way to pay people. It is a supply / demand and negotiated marketplace. There is no such thing as I am work $100k/year because I did XYZ and know ABC. I mean that may be true this second, but it is as only as true as the most up to date data. And is not true in any absolute sense.
It's essentially a min-max problem. Optimization is achievable, but hard work.
It demands honesty from both parties and any employee must understand exactly what you said: companies can't give all the employees want. You have to know your own value and make yourself valuable to the company first, then ask for recognition.
The Pink Floyd song put's it well "When you ask for a pay rise it's no surprise they giving none away".
What does work for getting a pay rise is:
1. If you are genuinely paid less than market then prove it by getting an offer from another company.
2. The other option is to get promoted into a new role. As a developer that usually means becoming a manager - so even if you could add 10* more value as say an "architect" it may be more profitable personally to become a manager.
There may be other more 'ruthless' ways too. I am not ruthless enough to know about them!
But all in all value and pay are roughly correlated but increasing one doesn't necessarily increase the other.
This is particularly not true inside the tech industry: good employees are constantly harassed by other companies. They will offer higher wages, shorter hours and tons of other benefits to make a wanted engineer turn. Sometimes those offers are hard to turn down, even if you are pretty happy with your job.
What I've seen happen to me and friends is a simple matter of chosing to be honest or not. Last time it happened to me I sat down with my boss and told him:
- Boss, these guys want me pretty bad, they have been harassing me for months now and I turned down every offer. Problem is, they gave me this X offer now and, taking into account that I'm getting married next year, the extra money would be handy, this is getting hard to say no.
He gave me a counteroffer and we lived happily ever after.
Bottomline: sometimes the employee does not really want to leave, but it's a tough market out there. If you want to keep your engineers (and other employees as well) you simply have to be a better workplace than the others. This includes money, benefits, hours, bureaucracy, stress levels and every other possible aspect that your employee might take into account.
It's not really that different than building a product which is better than your competitor. Problem is that H&R and Hiring guys want so bad to make a case for themselves that they try those magic and golden rules that simply won't work.
You are dealing with people, be nice to them and they will be nice to you in return. If they don't, you don't want them in your ranks anyway.