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10.8 Q&A Focused on Negotiation and Closing the Offer

Learning Objectives

  1. Learn about real-life negotiation and closing-the-offer scenarios by reviewing questions and answers that will help you face similar issues in your job search.
  2. Learn that no matter what level of your career, you will always need negotiation skills, and you will always need to drive toward a closing situation.

Often, listening to questions and answers about a topic brings it to life. The following Q&A came from real job search candidates trying to solve issues they faced in their job search. The questions are written in the present tense and will include phrases such as, “I did this” or “I’m not sure what to do here.” Read on and learn about how to manage these situations should they arise in your job search five days from now or five years from now!

Question 1. I am planning to accept a job that pays below market because everything else about it is ideal. The job responsibilities are exactly what I want to do. The structure of the organization is ideal and my boss and team seem great. I also expect to move in two to three years anyway. How much impact will the lower salary have on my future negotiations?

Answer. You should be commended for considering factors other than just salary in your job decision. At the same time, salary history carries a lot of weight in future salary negotiations, so the decision to take a lower salary now will require extra work in the future:

  • Better negotiation skills. Your past salary is a very strong anchor in the minds of prospective employers. I once conducted a search for a leading Fortune 500 company who finally found their ideal candidate after almost two years into the search. Their prospective hire had been grossly underpaid, so to bring him to market, the company would effectively have doubled his salary. In their minds, that suddenly seemed like a lot, so instead, they offered him slightly below market but still an enormous increase over his former salary. The candidate eventually negotiated for market value, and everything worked out, but the negotiation took much longer than it should have (and the candidate had to be a much better negotiator than he should have) because of his original salary discrepancy.
  • Better positioning. Your past salary signals to employers your level, title, and responsibilities. Once you accept a lower salary to start, you then have to convince successive employers that you belong at the level, title, or responsibility that in their minds command a higher salary. You will need to position yourself so that future employers don’t have to think, “If she’s so good, why isn’t she paid accordingly?”
  • Better personal financial management. Employers aside, your decision to take a lower salary affects your personal bottom line. You will have less money to save, invest, and cushion you during economic downturns.

Question 2. Is there ever a scenario where taking the lower salary makes sense?

Answer. Of course, there is. Career planning is a highly individualized process, so exceptions abound. However, rather than encourage you to accept a lower salary, I challenge you (women especially!) to explore as many other creative solutions as possible to get what you want without having to “pay for it” in a lower salary.

Question 3. What’s the best way to approach a recruiter about salary negotiation? How does someone new to the workforce approach negotiation? How does that approach change after you have a few years of experience?

Answer. Recruiters will demand to know salary before they present you to the client. They need to know that you are in the ballpark of what their client is expecting. It also is good market knowledge for them to have. So you need to know that whatever you say goes to their client.

When you are new, you might think you have no negotiating leverage. It is true that the big management training programs or analyst and associate programs at banks and consulting firms have set salaries with little negotiating. For everywhere else, and that means most other jobs, there is no standard salary. You are paid what the employer has in their budget and what they think you are worth. Look at the market value of your skills (computer, languages, analytical, coursework), your internships and part-time jobs, and your degrees. Know what benefit you will bring to your employer’s bottom line and what comparable people in these same roles are making. When you are new, employers will try to pay you based on your years of full-time experience because you have relatively little. You want them to focus on skills and results.

When you are experienced, it’s trickier because there are more variables, but the essential lessons remain the same. Know your market and how you contribute. That is your value and that should be your price.

Question 4. Due to the down economy, I committed to a job offer that paid very little (peanuts), but was offered a good job profile. As time progressed, I realized that the company did not deliver on its promises and I plan to quit soon. As I apply for jobs, I am expected to quote a salary based on my current salary. The current salary is very little and I believe that with my experience and education I should be able to quote a higher salary. How can one deal with this situation?

Answer. Your current salary is a very strong anchor to what employers think they need to pay you. Therefore, you need to do whatever you can to establish your value before divulging how little you make. Focus on what you are bringing to the job and what comparable people in these roles are making. See the points in the preceding answer. Now that you have established that this is the correct anchor, you can explain your salary as an anomaly and one of the reasons you are leaving. Employers are happy to get good hires at a fair price, even if that means paying a lot more than what you happened to make at a previous job.

Question 5. How do I respond when a job posting (application) asks for salary history and minimum salary requirement?

Answer. This is why I don’t recommend that people spend a lot of time responding to job postings. There is very little room to maneuver because some employers toss out applications with missing information, such as salary and salary requirements. I won’t even move ahead with presenting candidates to my clients and hiring managers without salary information. You have to respond with the truth, and, unfortunately, the salary you name anchors how the employer perceives you.

If you don’t want to respond, you need to find another way to apply that circumvents the application. Network into the decision makers and bypass the recruiter. Make a pitch that focuses on your value so that salary becomes a secondary consideration.

Question 6. I received an offer from a large consulting firm. The start date for the job is July fifth. My family always spends the July fourth holiday and the remaining week at my grandparent’s cottage in Lake George. This consulting firm has a training program that begins on July fifth. I’d like to begin on July eleventh. Can I negotiate for this?

Answer. Large firms put extensive time and effort into constructing training programs that can introduce you to the company, along with senior managers, and provide training that can be vital to your success.

Speak to your human resources contact and ask what is on the schedule for the first week of training. The training can be eight weeks long, with the first week scheduled with senior manager welcomes. If they feel this is something that can be missed, then you have an option to consider.

I would recommend you skip the family vacation this year, and get a good start to your career. Important networking contacts can be made in that first week when everyone is new to the company, and those contacts last decades. The information you can gather at this training event can be vital to your success.

Question 7. I have two years of administrative experience with a medium-sized manufacturing firm and I’m making $45,000. I finally got an interview for a job I’ve wanted as a compensation analyst. The recruiter said I would be offered the job for $45,000 because I don’t have any experience, but they really like me. I wanted $55,000. Should I hold out for that?

Answer. You need to do your research. What are entry-level compensation analysts getting in your market—Los Angeles? Let’s say your research gives you two data points that indicate the going rate is $50,000. You can then negotiate for the $50,000, citing the research, and citing that you have two years of business experience under your belt. In my twenty-five years of corporate experience, I’ve never seen an offer pulled because a candidate asked for an additional $5,000. Think ahead: is there anything else worth negotiating for? Either way, it may be worth taking for three reasons: (1) it’s a step up from administrative assistant, (2) you will be learning a new skill that is of great interest to you, and (3) you can grow within that discipline.

Key Takeaways

  • Learning about the struggles of others in the negotiation and closing-the-offer stage can be helpful for future career negotiations.
  • Research and communication are two vital tools when negotiating and closing the offer.
  • We negotiate for a lot of things, and probably never think we even negotiated at all. We negotiate for where to go to lunch, when to go to dinner, and what to do on any given project.

Exercise

  1. Together with a classmate, remember back to the last time you negotiated for something—anything—and what was the result? Discuss a positive result and identify why the negotiation went well, and discuss a negative result and identify why it didn’t go well.