One step forward; one step back; step together, and back again.
To perform the negotiation dance, you must have a good sense of balance. Knowing your value will help you feel more confident about staying in step during the negotiation process. The employer takes the lead and you follow, staying with the rhythm. You move together through the process, taking care not to step on each other. The dance is never confrontational or harsh, but smooth and in harmony.
Often, the first step takes place on the phone. The interviewer asks for your salary requirement or the salary you're currently making.
First the Music Starts
Begin with the realization that this is your opportunity to maximise your compensation. Now is not the time to sell yourself short or leave items on the table. Instead, focus on what you feel you need and ought to have, and then negotiate for it. Many employers will provide their most valuable executives generous packages of stock options, profit-sharing bonuses, generous severance packages, along with non-financial compensation like paid sabbaticals.
Postponing the salary discussion is the best step for you, at least until you have the information needed. By doing research ahead of time, you will feel confident knowing your worth. There is a point when the range, or your expectations, will be revealed, but it is better to wait for the interviewer to lead and give out the information first.
If the employer determines that you are right for the job, he will take the lead and make an offer. It is now your turn to move the dance to the next stage. But first you must evaluate the package. The following must be taken into consideration:
Base rate: Always the top priority.
Alternative compensation: Bonuses, commissions, stock options, profit sharing, etc.
Benefits: Premiums for insurance, paid time off, matching 401k, working conditions, etc.
Other perks: Car, education reimbursement, training, laptop computer and the like.
Let the Dance Begin
You call the hiring manager and say how delighted you are to receive the offer, but you have some questions and concerns. Scripting your dialog ahead of time will give you confidence to be succinct regarding what you want.
"Based on my eight years' experience in this industry, my MBA degree, and my proven ability to raise funds and build teams, I feel the base rate offered is low. Is there any flexibility here?" you ask.
Hold your position and count to 10. Silence is a strong tool in negotiations. The hiring manager waits through the silence and then promises to get back to you. He is in sync with your movements. You've presented your case well.
The Final Steps
Whether you are negotiating for more money or some other perks, the rules remain the same. Let the employer lead, and maintain your own sense of balance. By preparing and researching ahead of time, you can feel more empowered in this process, as a partner in a dance, moving with the flow. The rhythm of the negotiation should be smooth, moving toward the final step: acceptance and agreement.
The Negotiation Dance
Relocation Negotiation
Sooner or later, many of you will take jobs that require you and your family to move. You will likely incur significant expenses in the process, and if you are like most people, you will want your employer to pay for at least some of them. The following advice should help you handle this negotiation as effectively and collaboratively as possible.
Focus on Your Interests.
The whole point of negotiating for something is to address your real needs. Before you limit what you ask for, make sure you know what you want. Think broadly and do not limit yourself to financial expenses. For example, one client of mine decided these were her needs:
Assistance in selecting and paying for childcare (She still had to finish paying her old nanny.).
A higher cost-of-living subsidy.
A higher mortgage cost allowance.
A bridge loan, because she could not sell her house before she had to relocate.
Assistance in choosing a good local school for her older child.
Once you have thought about what help you need, you can prepare to negotiate for a package that suits your unique needs.
Find Out What Assistance Is Typical.
Your preparation for this negotiation should include the following:
Ask your new employer's HR department if the company has a written relocation policy or if it offers standard benefits.
Find out who has recently moved at the company and ask about their relocation packages.
Ask your friends or other contacts in similar firms about their experiences or their companies' policies.
If you are using a recruiter, he or she should be able to provide guidance as well.
Keep in mind that companies tend to vary in what they offer, and larger companies have more standardized policies. Therefore, compensation can differ by industry, city or even position in the company (executives tend to get more). Nonetheless, the following expenses are commonly covered:
Moving costs.
Temporary lodging costs.
Travel costs back home if you relocate before your family moves.
Assistance for a spouse who has to find a new job (may include job-search reimbursements, referrals to a recruiter and arranging for interviews inside the company).
Assistance in selling your house.
Develop Ideas that Benefit Both Sides.
No matter what is standard, many companies are willing to negotiate packages that address the distinct needs of their new employees. Still, even though everything is negotiable, your employer is more likely to agree to your ideas if they benefit the company as well. So anticipate this reality, and provide the advantages for your new bosses when you share your ideas.
For example, my client made sure to tell her new company, "I will be able to work longer hours and be more productive from the start if I can get a few important matters settled quickly."
Another client had an employer that, while willing to provide extra assistance for her relocation, did not want to set a precedent of deviating from its written policy. This person solved the problem by saying, "Well, what if we agree that this assistance will be called a signing bonus?"
Get It in Writing.
Once you and the company agree on a compensation package for your relocation expenses, make sure you capture that agreement in writing. A formal contract is not necessary, just a simple signed letter explaining what assistance is being provided by what time.
A negotiation about relocation compensation is the same as any other negotiation. If you focus on effective preparation, collaborative negotiating and out-of-the-box thinking, you will do well.
Five Negotiation No-Nos
While it's difficult to make definitive statements about what to do and what not to do in every negotiation situation, there are some definitive pitfalls to be aware of before entering the negotiation process. Here are five of the most common no-nos
Initiating Negotiations Too Soon
Timing is important here. The appropriate time to negotiate is when a formal offer has been made. If the offer meets your needs, by all means accept it. It's a mistake to negotiate just for the sake of negotiating, but don't assume you can't negotiate at all. There's nothing wrong with asking for time to consider the offer or outright asking if the offer is negotiable.
Only Negotiating Salary
While money is the most frequently negotiated piece of the compensation package, it's not the only one. It's also true that many employers have benefits such as vacation time and health insurance coverage that are established by company policy and are therefore nonnegotiable.
But other parts of the package may be negotiable. They include signing bonuses, unpaid leave, relocation expenses, flextime, severance, and predetermined timeframes for salary reviews.
In the end, it's important to maintain some salary flexibility until you've seen the whole package, including benefits. For instance, the job you're seeking may have a built-in profit-sharing plan, a great company-funded health insurance program, or a bonus or incentive program, which all have real dollar value.
Mistrusting the System
Many job seekers operate under the assumption that employers will, without exception, try to lowball them, no matter how well-qualified they are for a position. While there are employers who pay employees below industry standard, you should never enter a negotiation with a them-versus-me mentality. And don't assume that just because you've researched a job's market value, you'll get an offer within that range. While market averages are good barometers of pay averages, they're just that -- averages.
The fact is, many companies have a predetermined budget for every position and have pay ranges and benefit packages based on their established compensation hierarchies. An offer may boil down to a take-it-or-leave-it proposition, only because that's all the budget allows for the position, not because the employer is trying to take advantage of you.
Assuming Your Degree Entitles You to a Higher Starting Salary
Increasingly, having an advanced education is nothing more than a threshold requirement that enables prospective employers to narrow down the pool of applicants to a manageable size. If you have relatively little real-world work experience, your degree may keep you in the running, but it won't entitle you to a higher salary.
Also, don't assume your degree is all you have to offer the employer. Having significant work experience will probably carry more weight than a degree alone. There's a major difference between job-performance potential, which a degree can suggest, and past job performance, which indicates previous work experience and achievements.
Believing Every Negotiation Will End in Your Favour
No matter what you bring to the negotiating table, it's naive to assume you'll always get what you want. Negotiating isn't a win-lose proposition; it's a compromise, and you should expect that going into discussions. Very few of us are in such demand that we can write our own tickets. That doesn't mean you should settle for any offer that comes your way, but sometimes an agreement won't be made. And accepting a job just for the sake of a paycheck could lead to mutual dissatisfaction. Ultimately, it could be better for you to continue your job search.
Salary Negotiation: 11 Popular Myths
Once you have aced the interview and been offered the job of your dreams, complete the package by making sure that you get paid what you are worth.
Being aware of these 11 common salary negotiation myths can keep you from selling yourself short at the bargaining table.
Myth #1 - No Application Will Be Reviewed w/o Salary Requirements.
Ads sometimes print this to begin the initial screening process. By saying too low or too high of a figure, you eliminate yourself from the running. If you are a qualified applicant, employers will not toss your resume aside simply because it lacks salary parameters.
Myth #1 - In The Hiring World, No Exceptions Are Made
Bottom line, employers can always make exceptions (to salary guidelines/restrictions) if they feel like you are the best candidate and you will not take the proposed offer.
Myth #3 - Employers Dislike Negotiating Salaries.
Most interviewers will like you more and feel more justified in hiring someone who fights for what he feels deserving of. There is no harm to try and justify to an employer why you deserve more.
Myth #4 - Past Low Salaries = Future Low Salaries.
Even if your salary history is less than stellar, you can show the employer how you’ve developed your skills and talents which now makes you a more valuable team member.
Myth #5 - Always Negotiate For The Highest Salary.
Cash is not always the most important thing. What about benefits, bonuses and quality of life? Does the job offer you the opportunity to do what you want to do and still have a life after hours?
Myth #6 - A Salary Is A Fixed Figure: You Can't Change It
All salaries are negotiable. Even if you can’t increase your paycheck, you may be able to land more benefits or bonuses to sweeten your entire compensation package.
Myth #7 - A Beginning Salary Is Just That - A Beginning.
Wrong! Most raises are based on a percentage of your current earnings. So those who accept a lower salary without negotiating may be kicking themselves for years to come.
Myth #8 - Not Asking For More $$$ Improves Your Chances.
This strategy can sometimes backfire and make you look less valuable to the company, decrease your self-confidence and actually decrease your chances of landing the job.
Myth #9 - You Should Take The 1st Offer And Be Grateful.
In reality, you should always negotiate the initial offer because it is just a starting point to wind up at the highest end of the salary range. Most employers plan for negotiation and start the offer at a lower salary to begin with.
Myth #10 - Agree To The Final Offer A.S.A.P.
Some job seekers may think that someone else could take their place if they don’t jump on the offer. Not true. Getting the offer in writing welcomes you to join the firm until you say any differently. Take at least 24 hours to think any offer over.
Myth #11 - If I Don't Take The 1st Offer, Someone Else Will.
Applicants may be scared into taking the first offer because they think another applicant will gladly snatch up the offer even if it isn’t that great. If the employer wants you enough, they will pay you enough, in one form or another.
CONCLUSION
Knowledge is power and knowing that you have room to negotiate will help you to ask for and get the salary you deserve. Remember that the first offer from an employer is usually not the last and final offer - there is always room for negotiation.
Getting a Raise: The Negotiation
Once you've done some careful planning about the raise you want and why, you're ready to focus on the actual meeting with your boss.
Start by scheduling a meeting time when your boss' stress level and workload are manageable. An informal setting like lunch often works because it allows you and your manager to relate on a more personal level. Make sure to articulate in advance, however, what the meeting is about, so your boss can prepare. Also bring notes or materials that support your accomplishments, in case your boss wants to discuss them during the meeting.
The next five steps will help you with the actual discussion of your raise.
1. Set a goal and practice.
Before you meet face to face, decide on a number that you'd be satisfied with and prepare how you'll respond if you don't get it. You also may want to practice your tone on a family member or friend prior to the meeting, because there is a fine line separating the assertive/sincere and boastful/arrogant approaches.
Now, on to the actual discussion. If you're underpaid and you know it, don't complain. Instead, remain calm, positive and professional. Tell your boss about what you enjoy working at the company. Talk about your performance in a factual manner and provide concrete examples of how you add value to the organization. When it comes time to pop the question, use the word "compensation" rather than "raise" or "money." In the event that your boss declines your raise, don't close your ears to the rest of the discussion. She may be willing to offer you other perks instead, like extra vacation time, flexible hours, or a nice dinner with your significant other on the company.
3. Negotiate.
Despite your best efforts, you may not get the compensation you've earned. Sometimes the only way to get a serious pay increase is to switch to a new position. Or, you could ask your boss what you need to do to receive an increase, and if it's possible to revisit the issue in a few months. Do not give an ultimatum, unless you are prepared to walk out the door. Even if you have another job offer in hand that pays more, you cannot assume that your manager will make a counteroffer.
4. Escalate the matter.
Your boss may tell you that she would like to give you a raise, but her hands are tied. If this is the case, ask her if the two of you can schedule a meeting with the higher-up responsible for the decision. Do not go over her head without her knowledge, and make sure she is kept on the loop on all matters concerning your compensation.
5. Follow up.
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