While there's no lack of good executives looking for better deals, prying them from their existing jobs is not easy.
Some business owners find they have to give up more and more to lure talent away from the big guys. All the good executives are taken, it seems, and most are getting rich on stock options in the long-running bull market. One entrepreneur tells the story of wooing a big-time chief technology officer during a frenzied two-week period. Just when the business owner was set to reel her prize catch aboard, the executive's company announced it was going public, increasing the CTO's stock value by 75 percent overnight. Needless to say, the executive stayed right where he was.
In a sparkling economy, high-end recruiters say small companies have to be creative in landing the big fish. When pitching to potential management hires, it's a good idea to play the vanity card and let them know they're highly regarded in your industry. Then emphasize how likely it is they'll grow stale unless they take on greater risks.
When you do talk money, frame it in the context of a long-term deal so you'll have their talents on hand for a while. "It's got to be a long-term relationship, and you have to let them know up front," says Korn, who signs his top executives to big multiyear deals. "I try to stretch it out to 10 or 20 years so I know we're both in it for the long haul."
Don't be reluctant to embellish your company's freewheeling image. Smaller companies offer more flexibility and variety for new hires, who may feel stifled in their current jobs. "We try to match our company to what the executive does," explains 36-year-old John Mueller, owner of Idea Factory Inc., a $3 million bath-products company in Menomonee Falls, Wisconsin. "If we see a candidate who's tired of wearing a power suit, we let that person know we're a T-shirt-and-blue-jeans company. It sounds simplistic, but you should see the smiles on their faces."
Other entrepreneurs, recognizing that time is as big a commodity as cash, tempt would-be managers with flextime schedules and amped-up vacation packages. "Good people are used to having leverage," says 31-year-old Kristin Knight, founder, president and principal of Creative Assets Inc., a $14 million creative-recruitment company in Seattle. "So they expect the stock options and the big raise. Where you can beat the competition is on the time issue. If it takes an extra two weeks of vacation time to get them in your shop, then do it."
On-site perks don't hurt either, Knight adds. "We began having on-site masseuses to keep people happy."