Overcoming Common Objections with Executives
Common objections clients have about an executive is that they aren’t from the same industry, overqualified or don’t fit with the company culture
The Executive Must Be from My Industry
Through a recession or slow economic times, companies become accustomed to handcrafting lists of requirements for the executives they are looking for, from backgrounds to skill sets to the types of companies they have worked for in the past to “They must be from my industry.” As the executive market gets busier and less talent is available, companies become a little more flexible about their executive wish lists. So, which items are easier for a client to be flexible about and still find the right executive? Does the executive really need to be from their industry?
It is not uncommon for an executive to transition out of a single industry after a long tenure and want to broaden their experience and activities. Here are some tips for talking through this objection with clients.
What Role Will the Executive Play?
Does the client need a VP of sales with established relationships and a network inside their industry, or someone who has the knowledge and ability to take their product into new markets or industries? What is easier to teach, the basics of the industry, or the right skill sets, culture fit, and relationships to increase growth in other areas?
What Kind of Learning Curve Does the Industry or Company Have?
Is the client a high-tech company that requires the knowledge of someone with an engineering degree, or a consumer products company in which a solid understanding of manufacturing and distribution (acquired from any industry) is enough to do the job? The learning curve is generally much less steep for the latter.
How Much of the Management or Current Executive Team Comes from the Industry?
Is the existing team a diverse mixture that can contribute knowledge and tenure from inside the industry and combine it with new and fresh perspective from the outside?
What Does the Client Need an Executive to Accomplish?
Why are they bringing an executive on board? What is driving the need for this person, other than to fill a title or a seat? Are they looking to outmaneuver the competition or just catch up? Are they missing high-level industry experience, or do they need fresh ideas and outside-the-box thinking? One option is to look at executives from industries with similar characteristics.
Inside the Industry: Pros
- Short learning curve
- Already networked inside the industry
- May be able to provide key insights (not proprietary information) from other companies for which he or she has worked within the industry
Inside the Industry: Cons
- If the executive is coming from a competitor, how will he or she provide you with a competitive edge that has not already been provided to your competitor?
- Lack of originality and thought processes beyond the industry
- Narrower pool of executive talent
A Perfect Example of a Key Executive from Another Industry
We had a client in the insurance industry with some brick-and-mortar service offices. Their goal was to increase revenues through these offices. They could not imagine anyone outside the insurance industry working with their teams.
We brought in an independent executive with a retail and quick-service food background instead. The company quickly saw how they could leverage the executive’s background from outside the industry because he had overcome similar challenges in his own industry. The first year, the client company experienced a 20 percent revenue increase. (By the way, this was in 2008, when competitors were all experiencing a decrease.)
Being open to executives from other industries with attributes that a client needs just might help them hit the jackpot.
When it comes to an independent executive solving a company’s pain points or helping them to reach growth goals, there is no such thing as being overqualified. The objection you will hear most often is, “too much horsepower for what I need.” Roughly translated, the client is saying, “I don’t want to pay that much for what I think I need to have done.”
You can make effective counterarguments, including:
- By hiring an overqualified candidate, a company can bring innovation, efficiency, and maturity to the company, resulting in thousands, if not millions, of dollars in revenue, increased productivity, and cost savings.
- An outside perspective is invaluable in critical situations. Focus on the initial reason you were brought in. Often, the list of what the client needs falls into two categories.
Using accounting and finance as an example. Most of the items on the list can be done by an individual at the controller level. A few items on the list, however, will best be handled by a CFO-level individual. As much as the company may want to find someone who can do both, they will likely end up disappointed in the end. This is the most common scenario we see. But in the end, if they aren’t willing to spend the money and you aren’t willing to work within their budget (which likely means accepting less than your usual rate), this strategy isn’t going to work. The company will usually end up hiring a controller and bringing in a part-time CFO a few days a month.
The client is worried about culture fit. It is not uncommon for executives to have gone through some type of culture or work-style assessment. Make your assessment results available and be willing to talk it through with them. These types of assessments are often not used as deciding factors, but rather as part of a pattern in the overall picture. The more you show the client consistency throughout your interactions, this will become less of a sticking point.