(From question in wsj.com Small Business Forum)
Let me count the ways!
Small companies have many advantages in attracting top people. Here are a few. (I work with owner-run firms from 5 to 100 employees.)
— Shorter commute. One 50-person client just hired a COO for $120k who’d received a $150k offer from a corporation in the city. He opted for a local 10-minute bike commute over the hour+ daily grind each way. He figured the extra two hours a day added to his life was worth $30 grand a year.
— More opportunity. Another client hired a GM away from a much larger competitor. The guy saw that he’d reached the top where he was, and in the new job, he’d get to lead a major growth push. Big fish in a smaller pond.
— Less travel. Many professionals in their 40s and 50s switch to smaller, local firms because they’re tired of constant travel they’ve had in their corporate jobs.
— Flexibility. “Yes, we can bend your schedule around your kids’ soccer games.”
— More diverse opportunity. They see they’ll get to take on a much greater variety of projects and responsibilities.
— Get to work directly with the principals. Small companies may be headed by much more innovative and leading-edge people, and it’s a great opportunity to work with them.
— Less corporate bureaucracy and politics.
— Un-retired. Here’s a big growing trend: Senior people retire from the corporation, then go to work for smaller companies. They trade less money for lower stress and flexible hours. The oldest guy working with us is in his mid 70s.
Attracting top people is a marketing job. You must look at your company through their eyes, see what you offer that will attract them, and how you can make yourself more attractive. It’s about much more than just offering more money.
However, many small business owners discover that the people they’ve lured away from large organizations aren’t a good fit. These people may be accustomed to narrower duties, superiors telling them what to do (thus uncomfortable taking initiative), having a lot of support staff (thus not resourceful at getting things done). But by far the worst quality is exhibiting “employee mentality” rather than the “entrepreneur mentality” needed in a small, dynamic firm. And I’m talking about top-level managers!
So it’s essential to make sure that the “corporate escapees” you hire are comfortable in your small business culture.
Mike, as I read your blogpost, I remember one critical career move that I made just before I started my own company. I had worked for large corporations, and then a global consulting firm. I had the opportunity to join a small, growing consulting firm on a partner track. As you mentioned, I had the opportunity to work with the principals, and to have a great deal of input and autonomy on growing the business. It was a wonderful way to test out the entrepreneurial waters. Great post. Thanks for sparking my thinking.
Comment by Marcia Ruben — December 16, 2009 @ 7:19 pm
Thanks, Marcia. Yes, offering a candidate the chance to ultimately get an ownership stake can be a strong incentive to attracting an entrepreneurial candidate. However, I would advise the owner of the company not to offer this incentive lightly. And not initially. Before offering people a chance to earn a piece of your business, you want to make dang sure they’re the kind of person you want to share decision making and your financials with.
Comment by mvh — December 16, 2009 @ 7:33 pm