In the August 4, 2015 Ask The Headhunter Newsletter, a reader wants more money.
How should I request a better offer than the one that was made? By phone? By e-mail? By regular mail? Do you ask the HR person, since that is who handles the offer letter in the first place? How does the give-and-take take place?
Almost everyone makes one huge mistake when asking for a higher job offer. They fail to justify the extra pay.
Want more? Prove you’re worth it!
Why would anyone give you more money just because you asked for it? Yet job seekers try that lame approach all the time.
If you want more money, you must explain why you’re worth more.
(By the way: Don’t waste your time quoting salary surveys. No survey includes the exact job you’re applying for, or your exact constellation of skills and attributes. You will always lose the survey game because any smart employer will respond with yet another survey that “proves” its offer is handsome! See Beat The Salary Surveys: Get a higher job offer.)
When negotiating for a better offer, the goal should be to engage in a discussion rather than to put a stake in the ground, unless you are absolutely sure your asking figure is firm. This allows the company to explore the money issue with you, rather than be forced to respond with a yes or no.
Ask the manager, not HR!
It’s critical to have the discussion with the hiring manager, not with HR. HR might control the hiring process, but it’s the manager’s budget that your compensation will come from. So have this discussion with the manager, in person or by phone. (I would not use e-mail. It’s too impersonal.) Try this:
Make a commitment
“First, I want to thank you for the offer. I want to come work with you.”
That’s a powerful opening statement because it resolves one big question for the manager: Does this candidate want the job? Once you’ve made this commitment, managers know it’s worth their time to work out the terms. Too often, job candidates try to negotiate money without consenting to the job itself. Bear in mind that saying you want the job doesn’t obligate you in any way. If the money can’t be negotiated to your satisfaction, you can ultimately turn the job down.
Now comes the most important part:
“I realize you have carefully considered how much you think this job is worth. As we discussed in our interview, I believe I can do this job [more profitably, more efficiently, more quickly, more effectively] by doing [such and such]. For these reasons, I believe my contribution on this job would be worth between $X-$Y in compensation. Of course, if I can’t show you why I’m worth more, you shouldn’t offer me the job. Are you open to discussing this?”
Deliver more value
The key element here is value: You must show how the added value you will deliver is worth more money. Employers love it when you reveal you have thought carefully about the work and how you would do it profitably. It shows you are motivated to make the deal a “win” for the employer.
But I will warn you: If you cannot explain exactly what you will do to perform the job more profitably, efficiently, quickly — better, in some way, than the employer expected — then you have no business asking for more money. This is not a negotiating game. It’s about exchanging fair value for fair value, and you must be prepared to explain it.
HR cannot have this kind of discussion with you, because HR will never understand the ins and outs of how you will add more value to a certain job. Talk to the hiring manager, and let the manager go explain it to HR.
(Don’t know how much to ask for? See How to decide how much you want. Once you figure this out, lay the groundwork for your salary negotiations early in your interview. See The most important question in an interview.)
Once you’ve said your piece, it’s up to the manager to respond and engage in a discussion. The manager may decline to discuss a higher salary. So, you must know in advance whether you will back off and take the offered package, or politely walk away from the offer.
Be the better candidate
The only way to approach salary negotiations is to grant the manager a concession: Clearly state that you want to work for him or her. Separate your interest in the job from the compensation, and the manager is more likely to negotiate terms with you.
“I’m ready to come to work, if we can work out the terms — the compensation.”
(For more about how to negotiate based on your value, see Fearless Job Hunting, Book 6, The Interview: Be The Profitable Hire and Book 9: Be The Master of Job Offers.)
There’s no guarantee about how this will work out. But, the better prepared you are to discuss how you will do the job better than anyone else, the better your chances of working out a mutually beneficial deal with the manager. The only way to ask for more money is to show the employer the money!
How do you ask for more money? If you’ve been turned down for more, why do you think you were rejected? Can you prove you’re worth what you ask for?
“I’m ready to come to work, if we can work out the terms — the compensation.”
Powerful statement. This means to the hiring manager…
” your search is over, let’s just work out the details”
This presumes that your needs are in line with the offer, which it is if you read Nick on this before.
Fittingly, what’s the best way to respond to “What are your salary requirements” in an initial phone screening? Naturally, I absolutely do not want to say a number *first*. I’m not saying all employers are greedy, cheap b*stards, but I feel like I lose control if I cave first.
I’m asking because I have no confident, polite idea how to respond. I end up always cowering and blabbing away like an idiot, eventually barfing out a semi-educated range between X and Y.
I just want to know how much the business has budgeted (“budgeted”) for the position. I feel like I can learn a lot WAY IN ADVANCE if I know the magic number in Phase 1 of the interview process.
I do think “First, I want to thank you for the offer. I want to come work with you.” is a strong opening.
and everything Nick pointed out about making a point of proposing you can do the job better than expected has some value
A good “job” should stretch you, afford a growth avenue. As such, there should be elements you’ve not done before or not done much, which is going to make it hard for you to argue you’re worth more…for what? doing better the 80% you have intense experience doing already? If the job doesn’t have some unknowns for you to grow from, then it’s a babysitting job..maintaining status quo, and as a manager I’m definitely not going to go to the well for that, as if I’m patient I can grow someone within.
Job focus alone doe not give the manager much to work with inside as your advocate. He/she is going to have to propose an uplift on starting salary based on an unproven belief that you want 20% more to begin, because you can do the job 20% better than they expected. As Nick said do your homework and be prepared to back it up…somehow.
Instead I’d focus much more on the “working with you” part. I tell job hunters not to look for jobs, look for companies. This opening sets up that discussion. Emphasize that you want to work for company X, but more importantly, that Manager.
And you really should want to. Having gotten an offer I assume you had a healthy conversation with the manager. Out of which you should have walked away with what they yearn to accomplish with that organization…and for themselves.
He/she have already decided you can do the job..what you want to do is build on that, and point out you’re the person who will increase their chances to meet THEIR goals.
And don’t hesitate to be creative. By that I mean to redefine the job, to the degree that your value adds meet it,(and likely no one else) and that it has enough additional substance to be worth more. If necessary (meaning you want a big jump) propose a new one with more responsibility and scope…again that shows the manager you will move the organization and he/she toward their goal.
This kind of proposal is something that a manager can work with in even rigid systems. In rigid pay systems there’s often NO wiggle room on salary within a job, particularly starting unknowns, but a “new” job is a different matter. You want to position that manager to “sell you” not as a new hire..but an opportunity they don’t want to pass by.
Also, don’t leave out time, when you negotiate. If you’re confident you can pull off what you propose, you can suggest/negotiate for an earlier review. For example, per Nick’s approach to negotiating a higher starting salary because you’re going to execute better than expected, you can offer to take the risk of coming aboard at their proposed starting salary, but per agreement (in the offer letter), that you have a review in 6 months, instead of most likely a standard 12 months, and if you’ve indeed shown better performance than expected, move you to your proposed starting salary…without changing your standard review date. Or as I suggested, in six months promote you to a new job.
If you have the right kind of discussion, it won’t be viewed as “negotiation”. Act like you already work there and as a committed member of the team, proposing a better process, system, organization to move things along.
Keep in mind that old management adage “Don’t bring me problems, bring me solutions”. So as Nick said, don’t just dump this problem of a higher starting salary on to a manager, bring him/her the solution
@K-Ster: “I just want to know how much the business has budgeted (“budgeted”) for the position. I feel like I can learn a lot WAY IN ADVANCE if I know the magic number in Phase 1 of the interview process.”
Just ask what the salary range is on the job before you apply. Of course, employers hide this like it’s the key to their vault. But without an advance confirmation that you and the employer are in the same range, there’s no reason to talk. The trick is to get this range on the table. Who should go first? Here’s how to say it:
“I’d like to make sure we’re on the same page for salary before we invest our time in meetings. What’s the compensation like for this position? Let’s make sure we’re in the same ballpark.”
Then all you need do is decide whether to apply and keep talking. If they won’t tell you, I’d walk away. Would you enter an unknown restaurant and order off a menu without prices, then hope you can afford to pay for the meal? The only thing that will get employers off the dime on this silly issue is good candidates who decline to apply without knowing the salary range.
If the employer presses you for your desired salary instead, I’d actually consider stating it. You’ve got little to lose if you’ve thought carefully about it already. Look, you’re not risking a windfall. The salary range is not going to be a lottery win! It’s likely close to what you want. (However, NEVER disclose your salary history. That’s different. See links below.) But, if you go first, you must follow up with this: “Okay, I showed you mine. Now, if we’re going to continue talking, you need to tell me the range on this job. After all, we both want to establish a foundation of good faith before we invest a lot of time.”
Anyone who won’t cooperate isn’t worth your time. This is actually an excellent test of candor and integrity. Don’t waste your time with the guards protecting the vault.
The other point here is, this is why it’s so important to deal with the hiring manager from the start. That’s who is motivated to work with you. HR is more likely to decline to share any salary info, because HR could care less about who gets interviewed. It’s critical to work only with who has skin in the game. This is also why applying for jobs cold is a waste of time. There’s no one to talk to, no one to check salary with, no one to “vet” before you proceed. The system of online applications stacks the deck against you. You must decide whether you want to play the game with a Turing Machine or a hiring manager.
I’m a direct northeast type so apologies if this sounds blunt.
“Naturally, I absolutely do not want to say a number *first*. ”
Why not? Adages that those who offer/concede/move in a negotiation ” first” are the “losers” are pure nonsense. Good negotiators move things forward when it makes sense, not following rules.
I break this “folklore” probably 2/3 of the time.
If you want guidance, take the bottom number at which you would take the job and add 15% if you are asked early. See if that fits into your researched range.
” my research shows compensation for this should be about here X. Naturally, I will consider the salary, the benefits, and the history of raises before accepting an offer, but are we in the same range at this point?”
@K-ster: The conventional wisdom about “not stating a number first” has become an over-generalized old wives’ tale. Vp sales is right: You must use your judgment. What complicates this is what number we’re talking about. Stating your salary history number will cost you. A thoughtful statement of how much you want could be the smartest thing you do in a negotiation. Cfc. Bill Poundstone’s excellent book, Priceless, in which he discusses the anchor effect. Briefly, a number “on the table” can pull a negotiated figure up or down, depending on the original number. E.g., starting with a high number creates an anchor effect that leads to a higher offer. It’s not as simple as that, of course, but the parameters of the anchor effect are worth learning about. Get Poundstone’s book. It’ll help you make more money. See http://www.amazon.com/exec/obidos/ASIN/B004HB1D6S/asktheheadhunte
Thank you, Nick and Vp! This gives me focal points to build on and strengthen. I’m glad I learned to not shy from saying a number first.
When you hunt for a job, you are in sales. In sales, focus on numbers in negotiation, is selling to price, which sales stars strongly advise against doing.
Sell to value instead, which is what I view’s Nick’s original advice to be.
Trying to haggle over your starting salary in a vacuum can fit closely to that old saying “be careful what you wish for”
Nick made 2 very important points.
1) don’t waste your time with salary survey discourses. Major corporations do participate in surveys…but not to position themselves to haggle with job seekers…They do so for strategic reasons…to decide where to position themselves in the marketplace. That is a corporation can make a decision to pay high (above average) in the market, (average) at market or below market (below average)
2) Once decided, they then define the ranges to reflect their positioning.
3) And in this kind of corporation, they have guidelines on raises per your range penetration & performance, which you can assume has more wiggle room if you’re low in your range, and very little if you’re high in the range…top performers get more attention then those deemed to do average or below average work.
Which brings Nick’s 2nd point into play. Ask for your range, which includes how they are classifying you. Engineer I, Engineer II, etc. And as Nick said if the manager, HR or whomever won’t tell you, be careful & possibly just walk.
Salary Range is non-trivial info in your negotiation. Because you may think you’re doing a stellar job of kicking up your starting salary, to find out a year later you negotiated yourself high into your range, leaving your manager no working room to give you a decent increase. In short, if you fly blind you screw yourself nicely.
And far far better than having that discussion with the manager 1st. Better if you some networking to find some supportive person who works for, or used to work for your target company who’ll provide you the companies rules of compensation engagement including range information. So when you ask the manager, you already know the answer.
You don’t want to negotiate with a potential manager, you want to strategize with the manager, as to what’s the best starting salary and why. Because once positioned in a companies infrastructure it’s often heavy lifting to take corrective action, if you crack the code after coming aboard.
I was a Manager for over 30 years in the Computer Industry. I can’t recall anyone ever asking me how the “system” worked in the companies I worked for. I told them to head off future problems, and I’d tell them why I wanted to start them at the offer figure.
If you know how the system works, the professional levels and related ranges, and how comp is administered you can have a very intelligent discussion..or walk away and save yourself a lot of frustration.
Know what the manager has to deal with and understand what you’re asking for. He/she should explain why you’re idea of starting salary is not a good tactic.
Also, I haven’t seen it discussed, once you understand how the system works, and perhaps understand that the manager doesn’t have the juice to change some policy cast in concrete, you also can suggest a “sign-on bonus” that will negate the delta in the 1st year, which assumes that your performance will then get you where you need to be. This can be mutually beneficial.
By negotiating on value, I mean that if you understand that the pay you want sticks you in the high end of a range, your time is best spent proposing a value proposition to the manager that starts you in the low range of the next level…or redefine the new job so that, that job hits into the range of the next level. Trust me, from a managerial standpoint, this is much easier to do than going to the well proposing and “out of policy” starting salary outside your range, which the manager knows is not smart. If you bond with the manager, provide him/her with the ammunition to make the case, view you as an opportunity not to be missed, they will make the effort to climb the managerial obstacle course to propose something different.
To repeat Nick’s advice. If the manager won’t tell you the range, think hard about moving forward. I’ve worked for companies where that info was a deeply guarded secret (for competitive reasons actually) and I’ve worked for companies who gave you your professional ranges on a wallet sized card you could put in your wallet.
You have to use your judgment. Sometimes it really is career limiting for a manager to spill those beans. But we all can speak in code. What you really want to know is approximately where you land in the range, and consequently not just what you get coming aboard,…but a good idea of where you’ll stand over the next couple of years…if you deliver the goods
In sum a value approach is to find a manager you believe in (mission, objectives, goals, chemistry), sell him/her that you are a rare person who thinks like then do & can help them make headway on their corporate and personal goals better than anyone else around.
And with the rules of engagement in hand, negotiate entering at a salary that places you in the 1st quartile of a professional job classification.
And as Nick said be prepared to justify it. This is actually much easier than price haggling, because you can demonstrate it will ideas, direction, game plans, project proposals that validate that “you get it”, it being the manager’s vision thing. Haggling over salary alone is based on an argument that basically says “you don’t know me, but trust me, I’m worth more than you’re offering & I’ll back that up with my promise of top performance” It’s a weaker argument that a manager can do little with.
@Nick and @Don: Excellent points, especially those about being in sales when you are job-hunting and about telling and showing the hiring manager how you will do the job profitably. Now the challenge is to get managers, HR, and employers to sign on to this way of thinking. I think I’d kiss the one who doesn’t ask me for my salary history, or, better still, who is willing to have an honest discussion about salary–give me the salary range you have budgeted for this job (which includes benefits) early in the process so neither one of us are wasting our time. Even better, how about posting the salary range along with the job description and your requirements? This way, I’ll know that you want someone with a Ph.D in (fill in the blank), 10 years of professional experience doing this particular job, the skills you require (but will not train for), and that you will pay $20,000 per year, no benefits, for a non-permanent job. I won’t waste my time applying for it, and you won’t waste your time talking to me.
I recently had this discussion with a hiring manager. He asked me for my salary history, and I countered with “what is the salary range you’ve budgeted for this position?” He looked at me like I had two heads, then said “That information is confidential, and I can’t discuss it with applicants”. My jaw hit the floor—if you can’t discuss it with applicants, someone who might be working for you, then who can you discuss it with? I tried another tactic–told him that we’re both adults, that work and jobs are adult matters, and that while he should be concerned with hiring the best qualified applicant, as a candidate, I need to be able to have an honest conversation with him about salary and benefits–I’m an adult with adult concerns and needs about supporting myself. I need to know the salary range so I can determine whether I am still interested in the job. If the salary is too low, then I won’t be able to support myself, and if I can’t do that, then I won’t be able to do the best I can for the employer (because I’ll have to try to find a 2nd or even a 3rd job, I’ll be tired and burnt out and stressed out), when my priority should be to be profitable to the employer and to be able to do the job well (efficiently as well as profitably). He refused, and said that I was being difficult because I hesitated to provide him with my salary history. How what I made in a job 15 years ago in a different industry has any bearing on what he has budgeted for THIS job today is beyond my understanding. I got up, thanked him for his time, wished him luck in hiring someone, and told him that I was no longer interested.
Why do I need top secret security clearance to find out the salary range? It’s nuts, and makes even less sense. Yet he felt entitled to and comfortable demanding my entire salary history. So if I don’t know the salary range, then negotiating for a higher salary is impossible–I’ve no way of knowing if what I’m asking is outside the range of what they’ve budgeted for the job.
Awesome Marybeth! Thanks. I’ve thought out your answer but did not put it out in words, because I felt embarrassed.
A professor who saw my resume stated my work experience is greater than PHD status; it’s real work. This gives incentive to ask for more (if in the budget)
I’ve use the budget line and it works.
(Thing is the market is really ripe with unfortunate attitudes, once again, I’ll thank Nick for reinstating my confidence). I can read the signs on the wall now, I’ve interviewed so much, but after losing a job (when your mom dies at the same time), confidence can be shaken.
I’ll remember the details from Marybeth for the next time!
Great posts everyone.
Was once asked by a recruiter about my salary history. Told them politely, but firmly, that I would not disclose, also because I would go from a government job to a private consultancy, so the salary was not really comparable. But I was happy to state my expected salary range for negotiation, and got an offer in the mid of that range. Accepted the job for ca $90,000, and got a raise to ca $105,000 within a year.
Okay Don, I’ve read your post, and thanks. I’ve also thought the end-game, accepted ranges knowing the deal.
The questions that can’t be asked here go beyond the best candidate; it now gets into sex, race and confidence.
I’m taking the advice to the bank, have used and understand the manager’s viewpoint; in PMOs; it’s understood a manager has a boundary of parameters from which he/she can work with; where an employee can or cannot go.
At this point and time, and I am hoping at some point Nick can go here with the sex and race cards; I need work, willing to take less than if it can pay my bills.
Thanks again, Don, Marybeth, K-ster, VP Sales and of Course Nick!
As far as compensation goes, why do job ads never have rate of pay in them? even a range would be better than nothing, I am tired of driving miles away to find find out the job pays minimum wage, for management no less.
Very well written, and well thought out. I shared this strategy with my fiance, and she ended up getting 2K more. (and she is not the type who relishes making waves). So thank you!