I’m a big fan of Google Alerts.  I have them set up for multiple topics including salary negotiation.  This helps me to see developments in the topic.  Most of the time, I find myself adding to my knowledge base.  Once in a while, I find myself wondering how people can make such recommendations.

A case in point is a recent article in the International Business Times Blogs.  The title of the article is very accurate – “Always Attempt a Salary Negotiation.”  I heartily agree which is why I started my blog. The article references some great research about negotiating.  It’s the recommended low-risk strategy that gives me concern.

“If nothing else, we suggest a low-risk strategy of saying,

“Thank you, I accept the job offer…but I wonder if there’s any room on salary?”

To me this is a classic “putting the cart before the horse” situation. You are no longer negotiating once you accept the job.  You may be requesting, begging, or pleading but it  definitely is not negotiating.

Let me explain why.  During the interview process both the candidate and the hiring manager is considering whether or not the two of you make the best fit.  The norm is that the hiring manager decides first if the candidate meets the company’s need. When the decision is in the positive, the job offer with salary is the first indication of that decision.  At that very moment, you (the candidate) now know the hiring manager’s decision and your own. That’s one up to the hiring manager who does not know your decision.   If knowledge is power than you just became the more powerful person.  The moment you accept the job the power shifts away from you.

Consider the purpose of negotiations.  It’s a means for  two or more parties to make an equitable exchange.   A job candidate has knowledge and abilities that a company wants.  A company has pay, benefits, and security that a candidate wants.  The negotiation is a process to decide how much salary, benefits, and security the company  needs to exchange for a particular candidate’s knowledge and talent.  Once the candidate says yes, the company has their answer and they no longer need to negotiate.

My recommended low-risk negotiation opening is stating something closer to these words. “Thank you for the offer.  I need to consider it before giving you my decision however, one thing that strikes me right away is that the salary is lower than I expected.”

So, yes always negotiate salary but please don’t start the negotiation after you accept the job. Start with the negotiation and you will be more successful at getting a higher salary than the original offer.

@ Copyright 2011, Katie Donovan. All rights reserved. Reproduction without explicit permission is prohibited

Background:

It’s time to look for a new job.  Maybe it’s because you are bored, don’t like your boss, think the company is in peril, or any other reason.  The reason doesn’t matter so much.  What matters is you have started to get the word out to friends and relatives and friends of relatives.  As luck would have it,  a friend knows of a job at her company which would be perfect for you.

Excitedly you give your friend your resume.  Not only do you get the interview but you get the job offer! Starting salary is $50,000.  This is great, you get a job and  your friend will earn a referral bonus if you stick around for six months.

Taking the job as offered:

What do you do?  Most likely you will take the job at that salary. In this economy you are ecstatic to get the new job.  It’s at a company you love.  A friend recommended you so you have the beginnings of a social network.  You event have someone to go to lunch with on the first day!  Other things that you consider are:

1. Your friend stood up for you.  You can’t let her look like she’s recommending people who are not team players.
2. Your friend planning to use the bonus to rent a vacation cottage closer to the beach. You don’t want to be responsible for her to walk another ½ mile to the beach.
3. You are making $48,000 at the current job so this is a 4% pay raise.
4. It will be great to work with a friend.  It’s an instant “in” at the new company.

Other considerations:       

The above considerations probably look familiar but did you think about what the job is worth or what you are worth yet?  Most likely the answer is no.

What is the job worth?  Some research is needed to figure that out.  Some of the items you want to find are:

• Does the job title at this company have a more common job title in the general business world?
• What is the current salary range for that job title?
• What benefits are typical for that job?
• What are the bonuses typical for that job?
• Are there any changes based on geography?
• What is the typical employment package for that company?
• What are the salary ranges for similar job postings at other companies?

What are you worth?

• How closely do you match the requirements for the job posted?
• Do your talents minimize training costs for the new employer?
• What extra skills and experience will you bring to the job?
• How will you be able to expand the company’s revenue or minimize the company’s expenses?
• What intangibles are you bringing such as connections to venture capital, media, and potential partners?
• What talent will follow you to this new employer?
• What is the total worth of your current employment package?
  • Salary
  • Bonuses
  • Commissions or Spiffs
  • Vacation
  • Medical, vision, dental, life, disability
  • Education reimbursement
  • 401 contribution

Those are a lot of questions to investigate before making a decision.  In the next few blog posts I will go into detail on how to find the answers to these questions so you can make an informed decision on the complete employment package offered.

@ Copyright 2011, Katie Donovan. All rights reserved. Reproduction without explicit permission is prohibited