Q: After applying for a new, professional job for quite some time, I finally have an offer from a well-known, regional insurance company. However, the offer is making me angry. I will be hired on a contract basis for the first year and am expected to generate at list three times my salary in sales starting in the second year. My prospective employer keeps telling me “the sky is the limit,.” But, to me, it feels like I am getting all of the risk and the company is taking no risk at all. Should I accept this offer?
A: This compensation scheme certainly looks questionable for one who is accustomed to earning a steady, predicable salary. Having said that, I note that during the past four years, I have seen many more variations of consulting contracts, contracts for a period of years, and commission-based/contingency compensation than I saw before the most recent economic downturn. It seems organizations have been forced to develop creative ways to compensate employees/new hires without taking the usual risks associated with paying a salary.
You are correct in your observation that you would be taking on a disproportionate share of the financial risk. However, what are the benefits? You know the details of the package offered and how you fit (or don’t fit) the “successful” profile. That is, you know precisely how this package works and the kind of effort required for you to make any money at all.
In addition to your knowing, without question, what is going to be required of you to succeed, you also know in our current economic situation that having a job is far better than not having one for a variety of psychological and social reasons. Just getting up and going to work has health and career benefits beyond the salary which is why so many qualified professionals opt to volunteer when they are in between jobs.
Even though you have some questions about how the risk-reward ratio will balance with your prospective opportunity, it may be beneficial to take the job to use it as a springboard for further professional growth and achievement. Consider that you may get introduced to networks that will serve you well or that the job may offer hidden perks in the way of training, exposure and/or certification that may pay off down the road. On the other hand, if your days will be consumed meeting impossible quotas with little skill development and/or networking advantages on your side of the ledger, then refuse the offer.
Take a long hard look at the potential non-salary benefits, and carefully weigh them before turning this one down. When in doubt, trust your gut.
Contact Karen Alphonse at Karena@execSearches.com or visit ExecSearches.com for more information about our career coaching services.
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