What is the worst mistake you can make in salary negotiations?
Negotiating salaries for either myself or for someone else has always been an awkward conversation for me. I also don't think I am very good at it. What are some tips or mistakes that an employee can avoid that may damage their prospects of getting a higher salary?
Knowledge is power, therefore have a most knowledge before the negotiations meeting is key.
I think that the worst mistake is to go negotiations with no previous preparation.
The person should look at the salary research, Glass door and other sites to have a good understand of the right market salary level, then look to the company salary structure to have an idea of a fair desired salary. Then is good to have a list of achievements that would backup the salary increase request.
And then have a B plan if the response from employer is NO. For example if or some reason the company can´t give a salary increase try to request a tuition or request a follow up meeting in some months and also what achievements you should have done at the time of the follow up meeting.
Understand what the competition is paying and be confident is your skill and what you can bring to the table.
There are many, but the worst is the lack of understanding of your minimum landing point.
Following sports is a great way to get insights into negotiations. It can be hard to differentiate the truth from what's reported but there's usually some insights to be gained.
With that said, one of the worst mistakes you can make is to start too high. It's a common practice to start high in any negotiation. But if you start too high, it can insult the other party and put any future negotiations to a halt. This happened recently with the Red Sox and Jon Lester https://www.bostonglobe.com/sports/2014/12/11/jon-lester-debacle-red-sox-blew-epic-fashion/CO9yHaYZce8MxLqJDfISBK/story.html -- the Red Sox started too high and Lester countered by testing the open market [side note: it's embarrassing to link to any Shaughnessy article but it's a relevant link here].
In general salary negotiations are as simple as knowing the market value of the skills you provide. What salary do you think you can get elsewhere? Glassdoor has a great database of salary info: http://www.glassdoor.com/Salaries/index.htm
First you need to consider if you are willing to walk away from this opportunity if the salary does not meet your requirements or if this is a must have position. Obviously if it is a must have position the negotiation becomes more difficult for you.
Before you begin negotiating you need to determine industry rates, what is the minimum salary you are willing to accept and what benefits do you require.
Once you receive an offer you need to ensure it includes salary, benefits, benefit contribution, bonus structure and the total minimum and maximum salary plus bonus you can earn in the first year. You should also confirm the frequency of performance reviews and the potential for being promoted and receiving raises.
When you have all of this information you will have enough information to negotiate. By asking these questions they will understand that you are trying to determine the value of the employment and not looking at just salary. Businesses appreciate employees that understand their value.
When negotiating keep in mind that the business has a salary range in mind for the position. They will offer you a salary based on where they feel you fit within the salary range for the position baed on your experience. Some managers try to pay the least amount possible to show their boss they can negotiate.
If you are willing to walk away from the position be honest with the employer and let them know that you would like the opportunity to work for them and based on the entire package if they can be at $X amount then you would accept. You can only do this if you are willing to accept the position if they meet your requirements.
If you must have the position then you need to come back to them with a counter proposal that is higher than what you need hoping they are willing to neogtiate. You cannot provide a drop dead amount if you must have the position.
In some cases if the employer does not meet the salary requirement they may be more flexible with a bonus based on hitting certain objectives.
Many individuals have the same concern. So you are not alone.
I suggest the following:
Do not initiate a salary discussion. Wait until the interviewer brings it up..and they generally will at some point during the interview.
Salary should not be important until there is a match that the company is strongly interested in you and you in them.
When the company brings up the issue of your compensation expectations, you can take several approaches. Indicate that compensation is obviously important to you, however, the position and opportunities with the company is just as important.
You could say that your are sure that the company is competitive regarding compensation and could ask them what the salary range is for the position.
If they do provide the range and the range seems ok with you, simply say that the range appears to be fine and say that with your accomplishments and experience your compensation would fit near the top of the range.
If, however, the top of their range would not fit your expectations at all, again emphasize your experience and that you would be interested in something above the top of their range.
If they will not provide the range to you and they continue to ask your expectation, provide a range where the bottom number is something you could definitely live with and the top of the range you provide them is a good percentage higher than your present compensation.
There is a lot more that could be discussed, however, if you follow the above suggestions you are being professional when confronting this issue.
Becca it is an awkward process, I agree. The biggest mistake is to let that awkwardness keep the process from happening. My thoughts- 1) research prevailing rates in positions such as this in your area, 2) make a request that has built in wiggle room (that is the nature of negotiation), 3) demonstrate your worthiness during the interview process and 4) be realistic based upon your knowledge of self and the prevailing economic realities.