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Winning The Salary Negotiation Process By Not Answering
By Pat O'Donnell
© December 13, 2007, all rights reserved.
What are your salary requirements?
It makes many job applicants very uncomfortable when I tell them the best answer is usually not to answer the question as asked.
“But she asked me! She is the Director of HR, I can’t show disrespect!”
Why is it better not to answer directly?
- The best salesperson lets the client reveal what he/she is willing to pay before the salesperson finalizes his/her prices.
- If you were in charge of a multi-million dollar project on behalf of a company, top management would WANT you to negotiate and not cave in the first round of conversation with a vendor. They would be less likely to hire an executive who is afraid to negotiate.
- Salaries and other items in the salary/bonus/benefits packages are almost always somewhat negotiable. Telling you they aren’t is a common negotiating tactic but not necessarily the truth.
- Lowering your salary demands does not make you more desirable as a candidate.
So, what are your salary requirements?
The best answer is always “Salary negotiable based on other considerations.”
Now, this is hard to do when applying through a corporate HR portal and you are confronted with an HR form that asks for a specific number, but the correct thing to do is to fill in the space with $1 (yes, one dollar) or as a second choice your absolute minimum salary and in the next available space where you can insert a comment, add the statement “Salary negotiable based on other considerations. I can hear some of you gasping, but read on.
Junior HR folk love these forms because it avoids a more involved discussion and causes many applicants to name their lowest price, which saves the company money (but may not snag the best candidate.) If the company considers you a serious contender, if they are really interested in hiring you, the conversation will continue. The strategy does not change for contract versus permanent job negotiations.
The client can usually be more negotiable with things other than salary, especially in a public company where the COG or Cost Of Goods which includes salaries affects the quarterly stock price. The different salary package items come out of different pockets in the budget and the constraints on paying for your education, for instance, may not be nearly as tight as the base salary.
Here is how you DO answer the question of desired salary:
- There are a lot of things that matter to me in this proposed relationship beside the salary. Salary is important, yes, but also important are the responsibilities of the role for the first year. The potential growth of the role in later years. How often I will receive performance reviews. Having a bonus or commission plan that will compensate me as a high performer versus other people. Being on a cool project. Gaining more experience in X. A chance to finish my Masters/PhD. An opportunity to work with Y. The strategy is to name things that are important to you but also make you more marketable to them. Saying “more vacation” is okay only if bundled with things that suggest you will increase your value to them over time.
- “By the way, I am talking to other companies so I know what my value in the market place is. ” You need to say this even if, in fact, you aren’t totally sure what your market value is. This statement causes the listener to offer you at least the market average for your performance level if he expects to have a chance to obtain you. You use that strategy to find what you are worth in the market place. If you don’t like the initial answer you hear, you can always reply with an answer like “Gee, I am hearing much higher salary bases. What else do you have to negotiate with? I want to make this a win-win for both of us.”
- The goal is to keep the conversation open with no absolutes on your part if you really want the job. You want to give them the maximum amount of room to maneuver so they can bargain with whatever they have available to bargain with.
Let’s talk about the current market.
We are beginning to hear the word “Recession.” As of this writing, the market is soft in some places, like financial firms, but overall it is not a bad market.
If you are a Product Manager tied closely to the ROI (Return On Investment) or profit of your company’s most important product lines, it is still a very good market.
On the other hand, if you are in a cost/support department and cannot demonstrate your contributions to the company’s success, you may think it is a soft market.
The solution is to make sure you know how to be an advocate for your skills to the right listener. (A career counselor can teach you those strategies.)
Be Prepared
On the day you receive the formal offer, you need to be prepared to give a clear yes or no to their dollar/benefits package with no more than 24-36 hours delay. This is a test of executive character and decision making.
The company should not make the offer until they know that the company and the role are of real interest to you. They will hold off if you are in the middle of negotiations with another company. (The right job is the one you would choose if the money offers from both companies were equal, so they will avoid a money competition.)
They should not make an offer until the hiring manager/recruiter knows what a viable offer is. Well before this stage you need to have thought through what is the ideal package, what is an acceptable package, and what is the offer below which you walk.
You need to be ready to negotiate like a well-prepared executive who they can trust to make decisions on their behalf and keep business moving forward with a smile on everyone’s face.
Have fun!
Topics: Interviews, Salary |
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