Tail spinning into a panic about losing an employee and throwing money at them to stay isn't the answer In fact, we'd go so far to say that almost always, a counter-offer is not the way to go. This is why.
1. Why do you want to hang onto someone who doesn't want to be there?
It might be crunch time for your business and you might suffer somewhat by losing a key member of staff, but hopefully you have built your team in such a way that the hole won't be visible for long. A strong workforce structure should ensure someone can step in while you work to replace lost talent.
2. How does a sudden counter offer make the employee feel?
If they have asked for a salary review or feedback in the past and were turned down or disregarded, how might they feel when what they were asking for only comes when they say they are leaving? What does it say about you as a business if you will provide a pay rise solely for the purpose of retention? Why didn't that employee matter as much when they asked for a raise six months ago?
3. C'mon, you know it's not a long-term solution
If recruitment and retention has taught you anything, it should be that in order to fix talent problems, you have to deal with the underlying issues. A rapid counter-offer isn't fixing the fundamental issue be it in the role or in your business. It's a short-term fix that won't do them or you any good in the long run.
4. Consider the "golden handcuffs"
Employees who are restrained by these "golden handcuffs" may be happy now, but when they take their skills to market again they'll quickly find they've priced themselves out of it. Both parties need to see value.
5. Gain a deeper understanding around why they're leaving
Is this about their bosses? Their colleagues? The late nights and missed social engagements because of crazy deadlines? These issues and a whole host of others cannot be remedied with money. Reach a deeper understanding and you may be able to keep the employee, their current salary, and their loyalty and happiness.
At the end of the day, some employees will have just run their course with a company. If you can find out what is bothering them and it's something that you can fix, that's great!
If you can't turn the situation around and your only solution is to throw more money at them, you're better off to let them go as the counter offer is not the key to retention.