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When the job offer is on the table, the time has come to negotiate
a compensation package. The company is emotionally invested in you,
believing that you will benefit their team. To vindicate their investment
of time and resources in their employee search, securing you as
an employee becomes their goal. All this means that the employer
is willing to spend more on you than she would have been at the
end of the first interview.
The prospect of negotiating the terms of employment
surges through some like adrenaline and others like an imminent
fainting spell. If you do not tend to get the results you want from
negotiations, or the mere prospect of discussing money makes you
squirm, consider these guidelines for more effective negotiation.
Know what you are worth
. You can almost
guarantee that the person negotiating the terms of employment on
behalf of the company knows your value. When you begin negotiations,
you should also know how much your work is worth. Using internet
resources, do research on the salary and compensation ranges for
comparable jobs in the area. Be sure to use sources that account
for differences in cost of living between cities. Glean information
during interviews and from your network of sources that indicates
the relative value of the position in the company. Are you applying
to be a CFO or an entry-level accountant?
Set a clear goal.
Studies on negotiation
consistently show that people who set clear and aggressive goals
achieve more favorable settlements than those who aim low or do
not set goals at all. If you want a salary of eighty grand and a
total package worth 100 grand, shoot for it by throwing out an anchor
worth more than 100 grand.
Set a walk-away price.
You know your own
financial goals, responsibilities and liabilities. If you cannot
take anything under seventy grand and still make sense of accepting
the position, do not pretend that you can. Your walk-away price
depends not only on your financial needs, but also on the attractiveness
of your alternatives to accepting the offered position. If you are
currently making sixty grand and there are no other offers finding
you, settling at sixty-eight grand might not be a bad idea. If,
on the other hand, you have been offered a position for seventy-five
grand and a generous benefit package, sixty-eight grand seems less
Use fairness as your standard.
of fairness strikes a cord in most everybody, even though people
have differing perceptions of what that means. Obtaining a compensation
package that both you and the employer consider fair is particularly
important since you are entering into an ongoing relationship. If
you discover four months into the job that you are making twenty
percent less than your counterparts, your enthusiasm for your new
job can sour. If your employer feels like you bullied him into a
costlier package than the company authorized him to offer, he could
easily become resentful toward you.
You must be able to make a case for why your
self-serving version of fairness is appropriate. Are you worth more
than most people because you have more experience or because you
have a track record of attracting big clients? Perhaps the rationale
for your standard of fairness has little to do with you personally,
and everything to do with asking for the median market value of
your work. Maybe you are asking for a salary that is commensurate
with others performing the same role in the company. Remember: if
your negotiating counterpart makes concessions, she needs to be
able to justify her concessions to her boss. Reciprocally, it is
helpful for you to identify what your employer considers fair.
Identify all your interests.
and your employer probably have concerns or aspirations that are
not strictly monetary. You might want CFP training without having
to pay for it. The employer can satisfy this interest in more than
one way: by building a cushion into the salary that would cover
schooling costs or paying for the schooling on your behalf. You
might also want one flex day per week or the ability to work from
home a few times a month. You may value being able to leave by five
o'clock consistently to pick up your children, rapid promotions,
a gym membership or full health care.
Before you walk in to the negotiation, prioritize
your various interests and identify places where you are willing
to trade one thing of value for something else. Is the salary more
important than stock options? Is a gym membership more important
than a review and likely promotion in six months?
When you negotiate the terms of the deal, discover
what your employer's various interests and reveal your own insofar
as this would benefit you. Maybe the employer cannot go above sixty-five
grand and still maintain equity of salary within the company. Find
out whether the negotiator has full decision-making capability,
or if he is representing someone else who makes the compensation
decisions. Your employer may be able to offset a concession on your
part by paying for your education, offering stock incentives, or
giving you a signing bonus. Be creative.
Compete and Cooperate.
If your counter-part
is using hard-ball tactics like being forceful, brisk or patently
stubborn, you will do better not to lie on the ground and wait for
him to stomp on your back. If you encounter someone who wants to
play hard-ball, respond strategically. Do not allow the person to
bait you. Remember your goals and why your requests are fair. Withhold
information that might weaken your position. On the other hand,
if your counterpart makes a concession, it is important that you
also appear cooperative. You might need to make a concession as
well. Negotiating is not about winning, so much as it is a dance
towards a certain goal. Each person makes moves with reference to
the moves of the other person. When both people dance together,
it becomes less likely that either person will suffer bruised toes
or damaged egos.