Article: How 'Exploding offers' may short circuit your employer brand

Recruitment

How 'Exploding offers' may short circuit your employer brand

Exploding offers are detrimental to both employers and their prospective candidates.
How 'Exploding offers' may short circuit your employer brand

Rohan received a job offer from company X that asked him to respond to within 48 hours or the offer would go void. He was interested in considering them, but also wanted to wait and hear from some other companies. But he meanwhile needed to respond quickly to X and felt uncomfortable asking for more time. As he was worried that he would lose the one offer in hand and not hear from the others, he felt pressured into saying yes. He began to go through the induction process, all the while doubtful if he did the right thing and if he shouldn’t have waited and weighed other options. The forced decision feels unfair when the company could have easily given him more time. This thought lingers even as he starts working from X.

With the hunt for top talent intensifying globally, the hiring technique of “exploding” offers is commonly used by many companies, especially in tech and banking. There are many reasons why it is time recruiters need to stop with this hiring technique. “Exploding” offers refer to those coercive offers which come with very short deadlines (usually 48 hours or less) and force candidates into accepting, before they can have a chance to think about alternative options. 

As an aggressive hiring technique this might work in a short term, but the final results are far from ideal. In this Huffington Post article, organizational psychologist Adam Grant, who is a Wharton professor and author of Give and Take and Originals, calls out exploding offers as a lose-lose strategy. Let us take a look at why that is the case.

The candidate can’t think their decision through, therefore may not actually stay. 

Experiments show that compared with long deadlines, short, “exploding” deadlines result in a 8-13% decreased recruiting efficiency which means that fewer candidates actually end up with their ideal jobs and recruiters land fewer of their top-choice candidates. Candidates lose because they end up accepting an inferior offer to what they could have if they had the time to make an informed, well conceived decision. Companies also get lower payoffs because it is now clear that in order to reduce turnover, they need to attract candidates who believe in the organizational purpose. Exploding offers go against the logic as they often bring on-board less-motivated candidates. 

Such offers don’t bait candidates who are in fact the best fit, they rather bank on the risk-aversive temptation of the candidates who feel the need to have an offer in hand early on. Low commitment and imperfect fit means that the turnover of such recruits is high as such employees will always have one foot out of the door and will jump ship once the job offer that they wanted more arrives. 

Researchers at INSEAD refer to this approach as “myopic” as it focuses only on the successful hiring of the applicant. However, they say, “If the relationship does not end well because it did not start well, then the firm will have to start all over and it will be very costly." 

The candidate does not feel respected.

There has to be a rationale for the quick deadline – such as in the case of specific, contractual work when for e.g. a voice over artist is needed immediately because a record is getting launched in 6 weeks. Most companies can wait for their new developer comes on board in one, two or even three weeks. So it is a problem when they impose an extremely short deadline just because they are worried that the candidate may be considering other offers. 

While there must be some time-limit to deciding on a job offer so that the company can move on, an inflexible and unreasonably short deadline sends out the message that the firm is does not respect the candidate and gives them a reason to wonder if this treatment would be worse once they are actually hired. It raises a red flag because the companies who trick or bluff their candidates in one way could be shady in more ways too. It also reflects poorly on the recruiter as overbearing. 

Desperation is a poor reflection on a company’s EVP

In this article, J. T. O’Donnell, founder and CEO, CareerHMO.com, cautions employers from damaging their employer brand as exploding offers signal that the company is either desperate and strongly feel that the candidates would not choose them if they had the chance to consider alternatives. It also gives out the message that they do not really care about who they offering the job to, since they are willing to withdraw the offers so quickly.

In the era of social media and platforms like Glassdoor.com when bad repute gets shared in an instant, employers and recruiters should be careful about taking short cuts that can short circuit their brand. Job seekers, especially the skilled talent, today are an aware lot who research their prospective employers on all platforms and through all possible connects. It is therefore best if companies rescind the use of high pressure tactics and realize that they instead need to work on making their offers genuinely more attractive. 

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Topics: Recruitment, Employer Branding, Employee Relations

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