2015-03-11 02:20:59
Amy Gallo
You got the job. Now you ve just got to settle the details, in particular how much you ll get paid. If you re like many people this gives you a pit in your stomach and sends you straight to the Internet (or a friend or a mentor) for advice. Are you supposed to negotiate no matter what they offer? Should you start with a really high number knowing you ll have to come down? Do they expect you to play hardball to demonstrate you ve got negotiating chops? The trouble is that there is a lot of conflicting advice out there.
We asked readers (and our own editors) what advice they hear most often on negotiating a salary and then talked with two experts to get their perspectives on whether the conventional wisdom holds up in practice and against research.
1. Don t ever name a figure, even if they ask. Instead wait for them to give the first number and negotiate from there.
Deepak Malhotra, a professor in the Negotiations, Organizations and Markets Unit at Harvard Business School, says that it s a reasonable question for a potential employer to ask and it s in your best interests to answer it. If there is too great a discrepancy between what you think you deserve (or can get elsewhere) and their expectations regarding what you should be paid, it is better to uncover this and try to reconcile the differences in expectations, he says.
Both Malhotra and Jeff Weiss, a partner at Vantage Partners, a consultancy specializing in corporate negotiations, and author of the HBR Guide to Negotiating, point to research that suggests that there is great benefit to making the opening offer in a negotiation. It can be a good thing to set the tone, says Weiss. And you may also be able to nudge them upward if you can justify a higher number than the one they would have started with, says Malhotra.
However, what matters is less about who goes first in a negotiation and more about how you approach the conversation. Too many salary discussions are just offer-counteroffer games. But that s just a sure-fire way to end up with a number you won t be happy with, Weiss says. This does not mean that you want to talk about salary too early, warns Malhotra. It can be awkward if it s one of the first things you bring up and it s also somewhat risky if you end up asking for too little. His advice? Learn as much as you can before and during the interview process so that you can answer the question appropriately, if and when asked.
If, despite all of this, you find yourself feeling quite unprepared to answer the question, you can honestly tell the other side this, says Malhotra. It s OK to say that you need more information, such as about what the role will be, before you answer.
Besides, your alternative to answering the question is refusing to. That can make you seem difficult or unprepared, says Malhotra. It goes without saying that you don t want to look like a jerk. As he wrote in his article, 15 Rules for Negotiating a Job Offer, People are going to fight for you only if they like you. Anything you do in a negotiation that makes you less likable reduces the chances that the other side will work to get you a better offer.
2. Do your research and find out what other people with your title make in the company, or in the industry.
You should do as much research as possible. Search the Internet, use your network, go to your career development office or a trade association, if there is one, says Weiss. There is lots of information out there that will help you piece together what people are making at the company, says Weiss.
Reach out to people who work at the company through LinkedIn, Facebook, or Twitter and ask them what people make there. You might think this is an inappropriate question but in a recent HBR survey, 27% of respondents said that if asked, they would tell a job candidate how much they make. Of those who worked in education, government, and law, 48%, 44%, and 37% respectively said they would share that information with an applicant.
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Of course, there may be limits to what you can find out, and there s nothing wrong with that. Come prepared to the conversation with a list of the information that would be helpful to you in determining what a fair salary is. It s OK to ask questions that put the onus on the employer to gather more information, says Weiss. You can inquire, What is the typical salary range for a position like this one? or What do people with my same qualifications and years of experience make?
It s also helpful to find out what limitations your hiring manager is working with. Malhotra writes, they may have certain ironclad constraints, such as salary caps, that no amount of negotiation can loosen. Your job is to figure out where they re flexible and where they re not. Some companies may have a cohort of employees at the same level whom they have to pay the same. But they may be flexible on other things like signing bonus or vacation time. The better you understand the constraints, the more likely it is that you ll be able to propose options that solve both sides problems, says Malhotra.
3. Don t accept the first offer they expect you to negotiate and salary is always negotiable.
That s just not true, says Weiss. Sure, much of the time there is an opportunity to negotiate, but some hiring managers genuinely give you the only number they can offer. The best way to find out, says Weiss, is to inquire. And don t just say, Is that number negotiable? but dig into what went into calculating the figure. Weiss suggests asking: Where did the number come from? What did you count as my years of experience? There are many companies that don t want you to negotiate but that doesn t mean you don t come back with questions, he says. If an offer is made, there is an opportunity to explore and expand it.
But don t negotiate just to negotiate, advises Malhotra. Resist the temptation to prove that you are a great negotiator, he writes. If something is important to you, absolutely negotiate. But don t haggle over every little thing. Fighting to get just a bit more can rub people the wrong way and can limit your ability to negotiate with the company later in your career, when it may matter more.
4. Play hardball because it shows you re good at negotiating.
If hardball means you re well prepared, you come to the table with creative ideas, you negotiate with discipline, and you don t roll over when pushed, then, yes, play hardball, says Weiss. On the other hand, if it means making threats and banging the table, forget it. You might win, but you also might piss a bunch of people off, he says.
A smarter strategy, says Malhotra, is to think about what you feel you deserve and be prepared to explain why that is the appropriate or fair amount. Tell the story that goes with that number. Far from playing hardball, you should be in the business of making their life easier, he says. Think about how the hiring manager will be able to justify the amount you ve requested to his boss or to HR. Work with them to come up with creative solutions, he advises.
5. (Corollary to #4) If you re a woman, don t play hardball because you ll look too aggressive.
There are very few contexts where the person hiring you wants to see you play hardball whether you are a man or a woman, says Malhotra. And Weiss agrees: It might be more acceptable for men to rant and rave and make threats but I don t think that s good behavior for anyone.
That s not to say that women and men are on a level playing field. If fact, women are more hesitant to negotiate job offers precisely because they are treated differently. Research has shown that women are nervous about negotiating for higher pay because advocating for themselves presents a socially difficult situation for them. Tragically, women do face greater potential backlash than do men when they try to negotiate for higher salaries, says Malhotra. These risks may be mitigated only when the other side sees the negotiator man or woman as being fair-minded, empathetic, collaborative, and well-prepared to discuss not only what is appropriate, but how best to achieve it.
6. Don t just focus on the money. Think about the overall package.
Many people think about a job negotiation as being about one number, but it s not. It s about the overall package: who you work for, what kind of training you ll have, when you ll start, etc. Companies sometimes won t budge on the dollar amount, says Weiss. But you can get a lot of value by asking for things that don t cost much. And often, says Malhotra, these other aspects of the job are where your satisfaction with the job will lie.
Don t get fixated on money. Focus on the value of the entire deal: responsibilities, location, travel, flexibility in work hours, opportunities for growth and promotion, perks, support for continued education, and so forth, writes Malhotra. To figure out what specific aspects you want to negotiate, first think about what you want. Weiss advises exploring your interests behind the number. For example, if you want to make $75,000 at your job, ask yourself why. Is it because you want to travel or save up to eventually go back to school? If so, perhaps you would take less if the job allowed you to travel and came with a tuition reimbursement.
There are benefits that come at an additional cost to the company (e.g. a higher signing bonus), those that don t cost anything (e.g. a flexible work schedule or rotations within the company), and those that have a price but are already existing benefits and therefore don t cause trouble for the person you re negotiating with (e.g. tuition reimbursement, participating in training). Things in the latter two categories are likely to be easier requests than the first and you shouldn t hesitate to ask for them. With those in the first bucket, think carefully about how many requests you make.
Of course, even if you are able to create a sweeter deal for yourself with the overall package, the number still matters. The salary you accept sets a baseline for the future it s often what your bonus is calculated on and is the basis for the raises you ll get in the years to come, says Weiss. So it s worth getting to a number you feel good about.
But, if at the end of the day, you still haven t reached your ideal number, don t beat yourself up, or walk away necessarily. Salaries are often renegotiable, points out Weiss. If you can t get to the dollar amount you want today, keep in mind that you ll be even more persuasive six or twelve months into the job when you ve proven yourself.
If you love the job and you want it, there is no question you should negotiate with the above principles in mind. But if you re $10K shy of your request, don t obsess over it. Instead, says Weiss: Go in, be indispensable, and then negotiate a raise.
Amy Gallo is a contributing editor at Harvard Business Review. Follow her on Twitter at @amyegallo.