A very small amount of people are good at negotiating salary. (Typically it’s hard-charging males, although admittedly that’s a stereotype.) There are a couple of different reasons for this. To wit:
- Very few people truly understand what their salary represents and how it’s determined
- Similarly, many people don’t know the market factors that make up their earning potential
- Most hiring processes are an abject train wreck
At the intersection point of those three bullets, negotiating salary becomes very hard for most people. Also: there’s a general belief in most interviews / hiring processes that the company has all the power. I guess this comes from the simple fact that, uh, well, they’ll be paying you if they choose you. Since most people want to make money, they assume they have to do everything the company says along the process. This leads to some issues.
Negotiating salary: The company-side lies
Two specific things can happen here. You’ve probably lived through both of them when negotiating salary.
The first deal is “We don’t have a salary band for this role yet.” That is a lie. It’s 100 percent a lie. No company with a CFO or any accounting process would let a job be posted without a number attached to it. When you hear this, the company is lying to you. You absolutely need to understand that. The next step is usually, “Well, what did you make at your last job?” They will then increase that number by $2,500 and think they “did you a solid.” In reality, they probably could have increased it by $15,000 — but you don’t know that. If you go through a process of negotiating salary and this happens and you take the job, it’s a mistake. Relationships that begin based on lies and half-steps usually don’t pan out well.
The second deal is “They ask you for your salary range, you give it to them, and they undercut it at the offer stage.” Liz Ryan just laid out some of the major reasons for this in Forbes, including:
- “You don’t have industry experience, so your salary needs to be lower!”
- “We took another look at the budget, and it’s not as high as we expected!”
- “The money will be there once you prove yourself!”
- “Our culture is fantastic!”
This is all bullshit. Basically here’s what the hiring manager or HR person is really saying: “The top dogs want more money for themselves.”
At one level, that’s logical. Who rises up in a company for any reason other than chasing scratch? Once you get there, what the fuck is some “social media marketing manager” — “Show me their ROI! I hit my sales targets!” — doing taking some of your money? Pay them $50,000. If you could budget $70,000, Mr. Swinging Dick will take that other $20K, thank ya very much.
Negotiating salary: The roll-over
Many job candidates roll over for the treatment above because, as noted at the top, they need a job and they want to make money. So, essentially they take it in the posterior from some HR flack just to get their $65K that could have been $85K. I honestly have no idea how we call HR “human” in any way, and this is a prime example. A “human” interaction would go like this, IMHO:
- HR/hiring manager: “Hey, we have a role that we think we need to fill. Do you have these skills, or could you gain some of them?”
- Candidate: “Sure.”
- HR/hiring manager: “Cool. Well, we make about $12 million a year. It’s not huge. I won’t go into all our accounting and costs, but we could realistically pay you about $82,000. Does that sound good?”
- Candidate: “That sounds great. Thanks for being so open.”
Here’s how negotiating salary normally goes, though:
- HR: Lie lie lie lie lie vomit lie gag gag lie lie vomit spewing buzzwords “Hey we have a great culture”
- Candidate: “Fuck, I need to make rent. OK, sounds good.”
Negotiating salary ’tis a flawed system. Can we make it better?
Negotiating salary: How to improve it
There’s two sides to this:
On the employer side: Care about your talent strategy. Care about your people. Do market research and determine what people are worth. Over-pay the market. I know most executives would rather shuttlecock themselves through a window then pay some rank-and-file over the market, but … you pay people well, they tend to like the job more and work harder. Nothing here is rocket science. Six weeks after everyone takes a job, you know they’re already on the f’n cross about how hard they work relative to their salary. They’ll do that anyway, so cut it off at the pass by giving them more than they deserve.
On the candidate side: Ask transparent questions about numbers. If the answers are hedged or seem like bullshit, dump out of the process. I know you need a job, yes. But getting in bed with someone that clearly has no respect for you at the initial point of contact is a bad approach to negotiating salary and a bad approach to “where I want to work.”
Negotiating salary: Job role and culture
Let’s be clear about two things of importance here before we wrap up.
On the “culture” front:
- Issue 1: it’s impossible to know the culture of a place until you’ve worked there a while; no one else can define it for you.
- Issue 2: executives and hiring managers often view the “culture” differently because their connection to the work is different. They tend to chase money or revenue plays. Your job might not do that. How you connect to the money-making influences how you see the culture.
On the “job role” front:
- Issue 1: It’s way more important to “understand what you’ll do every day” than “have a great culture”
- Issue 2: Many companies essentially create headcount based on (a) who screams the loudest out of (b) a group of people who worship all week at The Temple of Busy
When you combine those two issues, you can often walk into a job with no real purpose or connection to the bigger picture of the organization. You’ll be doing a lot of “shallow work.” Eventually, this becomes depressing.
So when you’re negotiating salary, think about what matters to you. If it’s just the final number, then hit it big. But if it’s what your day-to-day life becomes as a result of the process, think a bit more on it.
Any other thoughts on negotiating salary?
My name’s Ted Bauer. Let’s knock down some targets.