3 Tips For Startups To Win Over Top Candidates In London's War For Talent

I was at an event last night hosted at Lyst, a gathering of COOs in the London tech scene.

I introduced myself to the group as a "recovering COO" and it was good to see some old friends and make some new ones.

The topic of talent comes up every time we meet. All agreed that hiring great people in London is getting more difficult. There are many opportunities for smart team players who want to make a difference, especially in tech, product and design.

Part of the challenge is finding great candidates. Equally difficult is getting a "yes" after having made an offer. Good candidates invariably have more than one offer to choose from.

Startups are competing with each other and the wider job market for the best talent. Having a strong vision of what the team are trying to achieve is a must. Finding candidates that buy into that vision is the first challenge. Putting a package together that closes the deal is another challenge.

A startup usually has to be frugal with cash. Big salaries are not usually an option. Even offering mid range salaries, a vision and story isn't enough to win the best candidates.

To complicate matters, many candidates don't understand or value the main lever that a startup has to work with, (stock options) and in many cases.

A couple of tips then from the group on how to close a deal with frugal resources...

Tip 1 - the three way offer 

To preserve your option pool for those that will value it most, make a three way offer like this.

We can offer you either
a) higher salary, no stock options
b) mid range salary, a few stock options
c) lower salary, generous stock options

This method often works as the candidate will choose what matter most to them. It's a simple risk/reward choice. By only offering stock options to candidates that appreciate their value you can maximise use of the option pool and offer compelling packages to those that want to share the upside.

It's also a great negotiation tactic.  In many cases people will choose the middle option.  That means the middle option should be constructed on terms that work best for the company.

Tip 2 - offer benefits, but use a menu

In the same way that candidates may or may not value stock options, there are certain benefits which are valued differently by different candidates.

Gym membership, life insurance, critical illness cover, pension contribution, private healthcare. All of these things can cost a company less to buy than it would cost to an individual. Offering benefits as part of a package can increase the overall perceived value without increasing the actual cost to the same degree.

A simple example is healthcare. It might cost someone £100 a month to take out private healthcare if they were to apply directly but under a company scheme the company would only pay say £60.

By offering benefits it means that a modest salary with a high perceived benefits package can be worth more to a candidate than a higher salary with no benefits.  Plus, the overall cost to the employer can be lower.

The key to is to structure a benefits package with the maximum value to the candidate that has a minimal cost to the company.  To do this, you can create a "flexible" benefits scheme and one way to do this is to use a points system.

A points system works like this.  Each team member would have a number of points to spend (e.g. 1,000).  Each benefit has a number of points allocated.  The points relate to the relative cost to the company.  A pension contribution of 1% of salary might cost 500 points for example, maybe an extra holiday day costs 200 points of maybe private medical care costs 300 points.  The numbers I've just given are just examples.

The point is that the company only spends money on benefits that the team member actually values.  I've built this type of benefits system on two previous occasions and a great package need only cost 5% of salary.  The perceived value is more like 10%.

You can also reward loyalty by adding more points for long service.

This kind of scheme works better for growth companies (as opposed to early stage companies) as some degree of setup and administration overhead is added.

Tip 3 - avoid making an offer via a recruiter

Everyone loves to hire direct and avoid recruiter fees but the reality is they are difficult to avoid altogether.

If a recruiter is rewarded with a % of base salary beware of making an offer via the recruiter.  They will sometimes bump up the salary demands of the candidate to get a better % cut.  If you talk directly with the candidate, you'll get a better negotiation experience and a better result.  Make this clear when you engage a recruiter that you intend to work this way.  Alternatively, negotiate a fixed fee with a recruiter to avoid any ulterior motives disrupting the offer.


The London talent war has no signs of easing.  If you have any other tips, do leave a comment below.

One Simple Question to Ask Yourself After Interviewing a Candidate

When you come out of a room from a meeting with a colleague, do you feel

a) energised?
b) sapped of energy?
c) just the same?

Guess what? Organisations that can scale excellence have a large number of energisers in the team.

This is borne out by a study conducted by University of Virginia's Rob Cross. As referenced in the book "Scaling Up Excellence" by Robert Sutton and Huggy Rao, they say Cross' team found that "successful and innovative organizations have networks that are swarming with interconnected energizers".

I often use this as a rule of thumb when conducting interviews for new hires. If I come out of the room more energised than when I went it it's a very positive indicator. If that candidate can make me buzz with positivity, the thought is that they can do the same inside a team. It's not a given, but it's a useful indicator.

Bear in mind that some people take time to warm up and will give out energy in a different way as you get to know them and as they get to know the team.

It's a useful mental shortcut though when evaluating new hires, especially in a startup teams where positivity is needed to walk through walls and make change happen.

I've blogged before about thinking about whether someone is a "multiplier, adder, subtractor or divider". The energiser is a marker for a good multiplier.

This is a two part equation though... you need energisers but you also need them to interconnect on a regular basis, across teams and functions to spread the positivity. Having an isolated energiser is like stopping the sun shining on a solar panel.

How Do You Do?

From time to time, all of us face at work THE REVIEW. 

In this article I'll share a tip on how to navigate the review process with confidence. My tip is based around one word, "How". 

The review process, normally designed by an enthusiast in HR is imposed on you as a member of the organisation. 

If done well, a review meeting can be a very helpful discussion between team member and manager. It does however require preparation on both sides to be worth doing at all. 

A review is a reflective process followed by a trusting exchange of opinion and fact. At least that's what it should be. So often however it's a one way affair where either the manager or team member have not taken time to reflect, gather information and organise their thoughts. When neither have done so it becomes a farce and worse than useless. 

The sense of trepidation many people feel going into a review either as a manager or as a person being reviewed is sometimes caused by anxiety about the outcome. I'd suggest that it's also caused by a lack of preparation. 

Remember the 7 Ps?

If not, here's a reminder; the 7 Ps is a British Army adage for "Proper Planning and Preparation Prevents Piss Poor Performance".

To prepare properly for a review you need 3 things;

1. Something to review against
2. Facts
3. Understanding

Something to review against would normally be previously agreed goals, targets or objectives. If you don't have these for any reason, a job description is a good back up. 

Facts are useful. Sounds obvious, but you'll need solid examples, numbers, customer feedback, sales figures, project delivery dates etc. 

The understanding piece comes back to the word "how".  "How" is the word that can help you prepare better for a review. 

"How did I/you achieve X?"

By asking this one question you can identify the positive behaviours that need to be encouraged or highlighted. 

It can be used to describe context in a way that facts alone cannot. 

It's a useful little word, whichever side of the table you are on. 

Give In Order To Receive

My Grandmother taught me that the best thing about presents is the giving, not the receiving.  There is great pleasure to be had in giving something to someone that they truly appreciate.

To solve someone else's need or want is a great human gesture.  We humans are social creatures and the act of giving is at the heart of all great relationships.  

It seems true in life that by giving we create goodwill and goodwill has value.  Reflecting on this, I realised that great relationships can exist between companies and a) their customers and b) their employees. And it all starts with giving.  Giving people what they need.

For example, every time I call my bank, they answer my phone call almost straight away.  When I get through, they answer my question, they are friendly and helpful.  I am a very satisfied customer and if ever get the chance, I tell my friends what a great bank they are.  I have been a loyal customer for over 15 years and will probably be for life.

My bank attracted my attention because they solved a problem for me.  My need. In 1997 my need was that I didn't want to have to walk down the high street to the bank. It was an inconvenience.  They promised 24/7 telephone banking (and later, when the time came, they provided all of this online). They made it easy for me to switch my account from my previous bank and they gave me a cash reward to say thank you.

They provided me with what I wanted, where I wanted it, when I wanted it and how I wanted it.  And they did it with a smile.  I rewarded them with my business and my recommendation.  It's a very positive relationship.

I realised that the positive relationship between a customer and a company has many similarities between an employee and a company.  Especially when it goes right.

Do you manage people?

If you do, don't you wish your team were as positive about you and as loyal to you as I am to my bank?

Here it seems lies a fundamental truth; your team are your customers and you are the customer of your manager.

Yes, people management is actually marketing.

In life if we solve other people's problems and provide people with what they need they will pay us for what they need.  That's business.  Any business is in business because it solves a problem or fulfils a need for it's customers. Give in order to receive.

Just as different customers have different needs and companies provide products and services to meet these needs, people working at those companies have needs.

You have needs and wants.  You need money to buy food, pay the rent.  You probably you want a purpose in life.  You will need to feel important and that what you do with your life matters.  You want to feel in control and therefore free of unnecessary anxiety.  You might want friends and need social stimulation.  Maybe you want to learn, develop and grow as a person.  Maybe you just want recognition and a "thank you".  You want information.

Employment can provide for some of these needs.  Just as great companies spend a lot of effort to understand their customers and provide what they need, I believe really great managers spend time to understand what their team truly need and want and figure out how to provide it.  Employees reward the company with their effort, creativity and loyalty.

(Note: people don't always know what they want.  Phone manufacturers used to think that what we wanted was a smaller and smaller phone.  It turns out we wanted a big flat screen.  We didn't know that. True needs are often hidden, often driven by emotion not logic.  Your team might say they want to be paid more.  This might be not their real need.  Their real need might be say, freedom to act, recognition or purpose. It's often these deep needs that are most powerful).

Think about the best manager that you ever worked for. Think about the best company that you ever worked for.  What needs and wants did they provide for you?  And did you give your effort in return?

When managers succeed, it's because they provide for these needs.  The need could be a training opportunity, it could just be encouragement and praise, it could be a fancy job title, it could be the freedom to make decisions, it could be a company social event, it could be a clear vision of what the company is trying to achieve, it could be the sharing of useful information.  When a manager or company gets this right, it seems like magic.  It's not magic, it's marketing.

Management is marketing?

Kind of, yes.

First of all then, what is marketing?

Here's the best definition of marketing I've ever heard...  "Marketing is creating and value and extracting value"

• Creating the value is defining a product or service that people are willing to pay for.  It includes amongst other things the function, the packaging, the place, the design.
• Extracting value how we get people to pay for that product or service. Communication, pricing etc.

If managing people is like marketing then it is all about creating value for employees and extracting value from employees.  So many managers focus on "extracting value" when in fact the focus needs to be on "creating value".  By creating more value, it's easier to extract value and to extract more of it.

Think about the relationship a company has with it's customers...

The best kind of customer is an advocate.  The advocate will tell everyone and anyone about your the great product and service.  Every business wants more advocates.   Then, there are repeat customers.  You like these.  Even if they are not advocates yet, you hope to make them into advocates.

At the other end of the scale are the detractors.  Those who really dislike your company and tell everyone about it. You need to convert these and save this relationship before it damages your business.

Now think about employees in the same way...

Employee advocates are what I call "multipliers".  They not only do a great job, they cause others around them to do a great job.  They do this because their needs are met. Repeat customers are your "adders".  They turn up every day and do good work - solid, dependable, but don't necessarily cause others to do a good job. The detractors are your "dividers".  They not only do a poor job but they cause friction, discontent and misery around them.  You need convert them or remove them if you can't.

Therefore, address needs and wants to build “multipliers”.

If you can provide for their needs, these multipliers will go the extra mile, they'll absorb themselves in their work and they’ll recommend the company to friend.

So many managers act as if they are the customer.  In a way that is perhaps technically correct.  At least that's the way the money flows.  The company pays a salary after all.  I however propose that this is a fundamental error to think this way and although it's counter-intuitive, we should start to think the other way around. Employees are customers.

If you agree with this approach, as a manager, there are implications;

1. Identify what your team need and want (at both an individual level and as a group)

2. Provide it

3. Continuously seek feedback if you are on the right track

4. Show appreciation

  

People management is marketing - the company is the product and the employee is the customer

Do you agree…?

Being Human, Implications For Organisations

Here’s where I’m currently at; it’s my belief that there are four key building blocks that form our perception of life:

Language
Emotion
Senses
Memory

I also reckon that if you view an organisation (or company) in the same way, it allows you to figure out how to influence its thinking and behaviour.

This is a tentative conclusion that I’ve reached after discussion and thought over the past few weeks. I’ve been thinking about what elements form the “essence” of our experience and understanding. It started when I realised that we as humans differ immensely from our animal friends in our use of language. Our brains articulate ideas and facts through language and our intentional communication, whether through speech, expression, or text, is rooted in a linguistic thought process. Language is intensely powerful in its ability to convey meaning but if used inconsistently can hide meaning. More about that later.

Then, realising that non-intentional communication (reactive expression for example) is more likely a result of emotion than language, I started to understand that there are some fundamental building blocks that allow the grey matter in our skulls to interact with its environment. There’s language, there’s emotion. Building blocks.

Another core building block (or a set of building blocks of course) are our five senses; sight, hearing, taste, smell and touch. These are inputs that guide us on our way.

For us to learn and to put into context our situation, we have memory. Memory, whether physical or mental, allows us to recognise patterns, store knowledge, build skills and interpret emotions.

These then are four core building blocks of being human: language, emotion, senses and memory.

Mastering these building blocks can lead to integrity, success and contentment.

Implications for organisations

As soon as you realise that these four building blocks exist, and that if they are developed and mature it can lead to integrity, success and contentment, you start to assess an organisation against the four areas.

Language

- Do we use inclusive language? I personally am on a mission to remove acronyms and abbreviations from my communication and where possible to remove it throughout the company. If you don’t know what an acronym means, you feel excluded, or just don’t understand.

- In meetings, does everyone understand the meaning of words? This is especially important in a multi-cultural company. I often pick up on complicated words and ask people to explain them for the benefit of the group. I know I understand the word, but I’m concerned that others might not.

- Do we all have the same vocabulary? What we call things carries immense power. Words convey meaning; therefore what you call something (e.g. “team member”, colleague”, “employee”, staff member”, “worker”) determines many things, not least of all how it affects company culture. Personally I detest the use of the word “department” because it conveys compartmentalisation, and I want to build a company culture of teamwork where the best people work together to get the job done. Naming of products, processes, procedures, office areas, events and job titles all matters. Far more than you can ever imagine. Change the language, change the culture.

Emotions

- Knowing whether we are slaves to our emotions or whether we are acting rationally is an important skill as a human being. Knowing when to listen to your emotions is important in life, and therefore this is also the case within companies. Ego, pride, fear, greediness – these for example are all emotions that a company can evoke in the way it reacts to its environment. Sometimes these are useful, sometimes not, but a company needs to be self-aware to understand if it’s acting emotionally and if so, why this is so?

Senses

- Of course, if we are to make business decisions, it’s good to have accurate information about your environment: your customers, your investors, your team, and your competitors. To gain this information, you need to look and listen, and sometimes, taste, touch or smell (particularly useful in the case of a restaurant business for example). Companies that fail to hone their senses, fail their potential.

Memory

- Winston Churchill said, “Success is going from failure to failure without losing enthusiasm”. By experiencing life we start to understand what works and what doesn’t. Trial and error has always been a certain way to learn. In this context, it’s our memory that serves us, that helps us recognise patterns and to build up intuition.

- As a Firefighter, Chef or CEO, every successful individual has along the way learnt from their mistakes. As a company therefore, how do you help yourself become a learning organisation?

- For a start, recognise mistakes, admit failure. Discuss what could go better next time.

- Also, create methods to store knowledge. People come and go. Whether in the form of documentation or training others, without making an effort to store skills and knowledge, they’ll leak, they’ll fade and you’ll have to re-learn.


If you want in business to create a happy and successful company built with integrity, pay attention to the four building blocks of human experience: language, emotion, memory and senses.

How Much Should I Get Paid?

Increasingly, employees want to make sure that they work on a good team, and on the winning team. It's not enough to get a great job title, a fancy office and a big salary.

Good people need to work with good people. Success breeds success.

Personally, I believe in really working hard on getting the right people on board. If you recruit well, everything else follows. However, it's not just about you finding a person to do the job well. The best candidates need to find a company and team that they really want to join. It's a marriage every time you hire. If done well, the divorce rate is low (few people leave).

So, I was very interested to see a website that is helping prospective employees find out about prospective employers. It's called glassdoor.com.

Sign up to the site and you can rate your current and previous employers. You can also find out salary ranges for each company by job type. The catch? To read reviews or to see salaries, you need to add a review or leave your salary details.

If this takes off, we could have a free, easy to access salary benchmarking service. Working out whether you get paid the market rate becomes easier and easier. HR teams will have a cheaper source of compensation data for benchmarking. Asking for a pay rise though will still be nerve racking.

I'm cautious. I certainly won't be posting my current salary or giving feedback on my current company, mainly because there's only one of me (COO) and so it'd be pretty obvious who left the comments. I would probably leave comments on previous employers though, given that the risk of getting into a comprimising situation is lower.

It's defintely one to watch. I think it will take off in the UK simply because we're so nosy about each other.

In the long term it could change the job market in that workers will have a totally transparent view of what it is like to work for a company before joining them. That can only be a good thing: employers will create a reputation by actually being an effective organisation, not by marketing HR hype.

Court Says You Don't Own Your LinkedIn Contacts

From Telegraph.co.uk...

"A former employee of recruitment firm Hays has been ordered by the High Court to hand over business contacts built up on his personal page of the social networking site LinkedIn...

...Mark Ions, a "middle ranked" consultant operating in Leeds, Newcastle and Edinburgh, allegedly used his LinkedIn network to approach clients for his own rival agency called Exclusive Human Resources, which he set up in May last year, three weeks before resigning from Hays Specialist Recruitment.

Mr Ions' solicitor told the court that Hays encouraged his use of the site and that once Hays' contacts accepted his invitation to join his network they ceased to be confidential as they could be contacted by anyone in his personal network.

Mr Justice Richards last week ordered Mr Ions to disclose his LinkedIn business contacts requested by Hays and all emails sent to or received by his LinkedIn account from Hays' computer network.

Mr Ions was also ordered to disclose all documents, including invoices and emails, that showed any use by him of the LinkedIn contacts and any business obtained from them."

This is a groundbreaking case and for anyone involved in sales, commerce or business development, it provides case law that should be noted.

If you use your LinkedIn network, during working hours, on your employer's IT network, for the purposes of soliciting business from your employer, you should be aware that in the eyes of the law, the fact that you use a "personal" email account, this doesn't let you off the hook.

Employment law is what it's always been - designed to protect employers from rogue employees - and the law just caught up with the latest technology.