Preparation is critical when negotiating the terms of your employment.
The more information you have, the more successful you will be.
That Employment Negotiations Are Unique
Employment negotiations are different from other types of negotiations.
They are not a one-shot deal like buying a house or a car. When
the employment negotiations are over, you will have to work with
your former "adversary" on a daily basis; more important, your career
success may depend on the person with whom you have just finished
negotiating. Therefore, even though you want to negotiate the best
possible deal, you need to proceed in a way that doesn't tarnish
your image. By the same token, your future boss will want you to
feel good about joining the company. Once an employer has decided
that you are the person for the job, the primary concern will not
be to negotiate the least expensive compensation package the company
can get away with. Rather, the main focus will be on getting you
to accept the job. As a result, employment negotiations are unusual
in that both sides share that same basic goal.
Your Needs and Those of Your Prospective Employer
Any employment negotiation is going to involve trade-offs. To be
successful in this type of negotiation, you need to examine your
own priorities. What is it that you want? Are comfortable with a
low salary and a large equity stake? Do you feel confident that
you can meet the requisite criteria to earn a bonus? Are you able
to handle dramatic swings in income from year to year? How important
is job security to you?
your needs will also help you determine what type of company you
want to work for. (For example, a family-owned company might
offer a larger salary than start-up company, but the same start-up
company will offer stock or stock options that a family-owned company
typically will not.) Regardless of the type of company you are considering,
an employer may not be able to give you exactly what you want. There
are numerous institutional constraints on how much a company can
pay for a given position or what kinds of benefits it can offer.
what you want and what a company can do within its own organizational
and budgetary constraints will enable you to determine what trade-offs
are possible in order to maximize what you get. This knowledge will
also enable you to walk away from a job when a company cannot offer
the type of compensation package that suits your needs.
the Dynamics of the Particular Negotiations
Sometimes you will have skills or experience for which there is
a great demand. You may be the only qualified candidate to have
made it through the interview process, and the company would like
to hire someone quickly. Similarly, if you have been able to defer
discussing compensation until the company has determined you are
the best candidate for the job, your bargaining position will be
greatly strengthened. These are enviable positions to be in. On
the other hand, you may in fact be one of several candidates the
company is considering, any one of whom it would be happy to hire.
Under those circumstances, compensation may be the key factor in
determining who gets the job. Sizing up the situation and understanding
the relative position of each of the parties to the negotiations
will help you determine when to press your advantage and when to
Lie, but Use the Truth to Your Advantage
Honesty is important. If you lie during the negotiations, sooner
or later you are likely to be caught. Once you are caught lying,
you lose all credibility. Even if you don't lose the job, you will
be placed at a tremendous disadvantage, and your future credibility
on the job will be undermined. On the other hand, total candor will
not be rewarded. You are not required to answer a specific question
directly unless the answer helps your position. You can determine
what you want to say and how you want to say it. One element of
preparation is to understand those areas which may be problematic
so you can rehearse how you will handle them when they come up.
the Role That Fairness Plays in the Process
The guiding principle for most employers in determining what they
will agree to is fairness. Within the constraints of their budget
and organization structure, employers will usually agree to anything
that is fair and reasonable in order to hire someone they want.
Appeals to fairness are the most powerful weapon available in employment
negotiations. Sometimes such an appeal may even convince an employer
of the need to adjust its salary structure or increase the amount
of money budgeted for a position.
should be able to justify every request in terms of fairness
If the cost of living is higher where you're going, it is only fair
to have your salary increased sufficiently to compensate. If comparable
executives in similar companies are given one percent of the company's
stock, you should be treated no differently. Your prospective employer
will want you to accept its offer and to feel that you have been
treated fairly. Understanding the importance of fairness as a negotiating
principle can make the difference between success and failure.
Uncertainty to Your Advantage
If an employer is not certain what it will take to recruit you,
its initial offer is likely to be close to its best offer. If you
have divulged too much information, it will likely not offer you
as much as it might have otherwise. By not disclosing exactly what
your compensation package is or exactly what it would take to get
you to leave your current job, you will force a potential employer
to give you its best offer.
You may not be able to get everything you want, but you want to
be sure to get everything you can. Focus on the value of the total
package. Look for different ways to achieve your objectives. Be
willing to make trade-offs to increase the total value of the deal.
Limit your "requirements." When you lock yourself into a position,
you limit your ability to be creative.
you are creative, you can package what you want in ways that are
acceptable to the company. You will also be able to find creative
"trades" that allow you to withdraw requests that might be problematic
to the company in return for improvements in areas where the company
has more flexibility.
the end, however, you still must get the company to agree to those
elements of the deal that are critical to you. If you are not able
to do so, or if have to give up too much to get what you need, perhaps
this is the wrong job for you. However, before you insist on any
particular term in your employment package, be sure that it is really
essential. By insisting on a particular term you may be giving up
something of greater value; you may even be giving up your chance
to get the job altogether.
on Your Goals, Not on Winning
Too often in negotiations winning becomes more important than the
actual goals that are achieved. This tendency is particularly problematic
in employment negotiations. Not only is it important to focus on
achieving your goals; it is also important not to make your future
boss feel like a loser in the negotiations. Remember, that this
person will control you future career. You will have gained little
by negotiating a good deal if you alienate your future boss in the
When to Quit Bargaining
There comes a point in every negotiation when you have achieved
everything that you could gave reasonably expected to achieve. At
that point you should thank the person you are dealing with and
accept the offer. If you don't recognize when to stop negotiating,
you run the risk of having the company decide that it made a mistake
by offering you the job in the first place. Most companies will
want to treat you fairly and make you happy, but few companies want
to hire a prima donna. Being perceived as greedy or unreasonable
may cause the deal to fall apart. Even if it does not, you will
have done immeasurable harm to your career with your new employer.
Forget That Employment Is an Ongoing Relationship
This is the most important and cannot be overemphasized. Employment
negotiations are the starting point for your career with the company.
They set the tone for your employment relationship. Get too little
and you are disadvantaged throughout your career; push too hard
and you can sour the relationship before it even begins. How you
handle the initial negotiations can have an impact, for better or
worse, on how successful your tenure with a company will be.
these negotiating strategies will enable you to effectively negotiate
the terms of your new employment. Once you have done so, you will
be able to start your new job confident that you have achieved the
best possible result.
from "Get More Money on Your Next Job" by Lee Miller