A Significant Return on Investment: Cost of a Career Transition Program
In years past, companies often provided severance packages that included outplacement service to their exiting executives. Today, this support is less common. An astute executive going through a career transition recognizes the value of having a dedicated and highly-qualified career coach. A substantial number of Kelleher career transition clients are what we term self-sponsored, i.e., they pay for their own program because their former employer has not provided it to them on departure.
Sometimes concern about the cost is a mental stumbling block for individuals considering career transition services. They hesitate to engage us because they are concerned about the expenditure when they have just lost or anticipate losing their position. Even if they are paid a severance by their former employer, and perhaps a third do receive such a payment, they are nevertheless reluctant to pay out of pocket as they are no longer receiving a regular paycheck and they are concerned about conserving cash during a challenging time.
While a great deal of stress can be experienced as a result of job loss, reluctance to invest in a Kelleher program may lead to the further stress as well as of a longer time to land, greater loss of income, and a sub-optimized compensation and benefits package when made an offer. The hesitation to choose a Kelleher program at this critical time is short-sighted and a serious mistake.
Electing to have a highly-qualified career coach and choosing Kelleher as a partner during this important career inflection point is a very sound decision for a number of reasons:
First of all, putting your savings or severance to work to purchase our services can enhance and accelerate the job search process. This parallels the classic and timely principle that ‘you have to spend money to make money’. Of course, once a new job is secured, the savings can be replenished out of income immediately or over time.
Second, Kelleher’s process can typically accelerate a client’s landing by at least a month, and often by even more time, because we focus on discovery/positioning, tool development, networking (including introducing our clients to our deep contact network) and interviewing, and negotiating and preparing to onboard our client into his or her new role at the new company. A simple calculation indicates that in most cases our clients will ‘pay back’ the cost of our program by improving time to landing by only one month. For example, a client who is earning $150,000 in base salary and lands one month sooner more than pays for a six month Kelleher program.
Additionally, at Kelleher we are often able to assist our clients in negotiating better final compensation packages than they would on their own, as most have never, or only rarely, negotiated their compensation in the past (and a large proportion of these clients haven’t done so in years). Again, in many instances, the difference we help bring about between initial offers and what is finally negotiated more than pays for a Kelleher program.
Third, if an individual is seeking a position that is substantially similar to their prior position, their job search costs are tax deductible in the year they are incurred. For most of our clients that means that 28% – 33% of the cost of their Kelleher program can be written off their federal return — see http://www.irs.gov/uac/Job-Search-Expenses-Can-be-Tax-Deductible (2012) and further reference IRS Publication 529.
Fourth, and similar to the point above, most clients may be eligible to receive unemployment benefits. They and their companies have paid for these benefits and there should be no hesitancy in filing for them when needed. These benefits, while certainly not of a level to completely replace an executive salary, can bring real cash into the household. In Pennsylvania, for example, the Department of Labor website says “Unemployment Compensation is for people who lost a job because of something that wasn’t their fault. If you’re out of work because your employer had to make cutbacks, close an office, went out of business or something you couldn’t control, it’s possible that you will be eligible to collect unemployment compensation.”
Finally, a candidate for our services can consider a low cost bank loan. Currently, a good credit score can qualify an individual for an unsecured $10,000 personal loan for a 9% -10% APR, and perhaps an even better interest rate depending on one’s credit score. The loan can be paid back over 60 months or once a new position is secured, without penalty. There are a large number of online loan resources as well as conventional brick and mortar banks that offer these loans. And if the client has a good personal banking relationship, the terms negotiated might be even more favorable. Moreover, any interest paid while the loan is outstanding is also tax deductible. So, again, the cost of the loan can be reduced by 28% – 33% depending on the individual’s tax bracket.
A rational business analysis, rather than an emotional reaction to an untimely and often unexpected job loss situation, strongly favors the purchase of a Kelleher Executive Career Transition Program from which a client derives substantial professional expertise, a proven methodology, key connections, and crucial negotiation support during a very challenging time in an executive’s career.
Beyond the clear financial benefits, the ROI for investing in a customized career transition program from Kelleher Associates is a directed, successful and efficient executive job search campaign with the process knowledge providing significant and lasting benefit over the course of an executive career.