Negotiation: Why Win-Win Is So Important
When negotiating your compensation and package, it is vital that you find a deal that is fair to you and fair to your employer - a win for you and a win for them. During my career in Executive Search, I developed a good level of expertise in finding the right number for both parties. I have taken these skills and used them to help coaching clients when their job offer is on the table.
So, when you are at the close of your job search, here are some thoughts that might help.
1. Know Your Numbers. Before you start your negotiation, have a good idea of what your numbers are. Get to know how much someone with your skills, experience and ability to add value can command in your market at this time. The number will vary over time depending on the state of the market and, more broadly, the health of the economy. By talking to contemporaries and recruiters and maybe seeing the salaries in posted job advertisements, you should have a good idea of what you can expect to be paid. Second, you should have an idea of how much you need to keep your life (and lifestyle) at the level you want. Finally, have three numbers in mind: what would be great - but not too much; what would be a good level; and, importantly, what is the lowest number that you would take without feeling that you have gone too low. Settling for a number that is too low will set you up for feeling bad about working for the new firm.
2. Understand The Variables. By this I mean, what are the other elements of the package which you can use to negotiate in order to strike the best deal? These may include: pension contributions, private medical and dental insurance, school fees, a car, extra annual leave, or if the job is abroad, flights, etc.. The idea is that you can find ways to improve your overall package at the margin. For example, if you have got to the point in the negotiation where they are unable to lift the base salary any further, you could ask for more annual leave or an upgraded car in lieu of the higher base. These variables are tradable items for you to use in the negotiation to create the right overall package.
3. Room For Manoeuvre. Bear in mind that in larger and perhaps more bureaucratic organisations, there is likely to be a strict structure of pay and benefits for each title level. This means that those who you are negotiating with are unlikely to have much room for manoeuvre. It is therefore important that you are being hired in at the right level and the best that you can do is to ensure that you are being rewarded at the upper end of the band.
4. Walk Away. It is possible for the firm that you want to join to be overenthusiastic in its negotiation and seek to get employees as cheaply as possible. When the employer is too hard, then they will be creating a win for themselves but a loss for the prospective hire. This is a strategy that is unlikely to work them in the long-term because either they will not be able to attract good talent or they will not be able to retain them. The win/lose then becomes a lose/lose situation. This is one of the reasons that I work hard with my clients to get a job offer from more than one employer at the same time. Having this choice puts my clients in a strong position because they feel that they can walk away if one of those offering a job is being too ‘robust’ in its negotiation. By the same token, when planning out your negotiation strategy, it is important that you are asking for a fair number from the employer so that they have a win too so that they can hire you at a fair rate.
When a win/win is achieved, it provides the relationship between the firm and the new hire with a firm foundation from which to move forward.