Five speedbumps to avoid when negotiating your salary

You’ve done a good job for a year or longer at the same salary, or you’re up for promotion, or you’re being interviewed for a new position — what’s uppermost in your mind? A bump in salary, of course. What’s uppermost in the interviewer’s mind? Creating a salary speedbump. That’s why it’s called a salary “negotiation”.

Unless you work for an organization with clearly defined salary steps based on time on the job, or have been told to expect raises tied to an annual cost-of-living index, a salary discussion is an ambiguous negotiation. Many employees stay at the same compensation level for years because they lack the confidence to initiate a performance review or a job search. If, however, you feel you should earn more than you are making or the salary you would make, given more responsibility, here are negotiation roadblocks to avoid:

  • Don’t yield to the “I need more money” approach. Even if you’ve just found out that another baby is on the way, don’t reveal that as the motivation for asking for a raise, or for negotiating for more money than is being offered at a job interview. A company cannot concern itself (and shouldn’t concern itself) with the financial portfolios of non-family employees.
  • Avoid the “current salary formulation” pothole. The most common interview question is about your present salary. However, your current salary doesn’t matter. It was offered long ago for work you’ve since mastered. You’re more proficient and you add more value to the organization (current or new) than you did when you agreed to work for that amount. If you reveal it to a new job interviewer, you will be offered, on average, 5-10% more, regardless of what the company had actually budgeted for the position — which might have been 20% more!
  • Don’t be blinded by the bright lights of a higher-than-expected salary. Salary is only part of a compensation package. Before saying yes, find out how much travel is involved or average work hours (especially for salaried positions, when you might work 80 hours for the same salary). How do the benefits compare; will you forfeit dental, vision or life insurances — or accrued vacation days? What training is offered? Say yes to the money after asking these questions.
  • Don’t appear to be vague about your preferred salary destination. Giving vague answers when asked what salary you’d like to earn, or if the offer is acceptable to you when it isn’t, stalls your momentum. It’s far more comfortable to say “I was hoping to make a bit more” than it is to say, “I was hoping the salary offered would be about five thousand higher than that figure,” but the latter might prompt the offer of a two-part raise within a specific time period, or another offer. Saying “a bit more” offers no guidance at all and weakens your negotiating position.
  • Don’t steer the conversation based on your own rearview mirror. Does the offer seem low? Companies reinvest profits in infrastructure, on average, every five years, when they typically will not have the resources to hire top talent at top wages or give raises. If you’re being considered then, a stock option or bonus plan might make more sense than immediate reward. The benefits of joining a smaller company might not be measured in dollars at all, but in the amount of direct influence you might have to promote change. Every discussion is a fresh discussion with fresh options.

The key to a salary discussion is (1) knowing what you bring to the table and (2) learning what the company is willing or able to pay for it at that moment in time. The more you can focus on those two points, the more confident and straightforward you will negotiate, and the more likely you will be to earn your top value.

About Jody Glynn Patrick

Jody is President of Glynn Patrick & Associates, which provides management consulting, executive coaching and strategic planning services. She is Publisher Emeritus of In Business magazine, which she published for 17 years. Selected as the “U.S. Business Journalist of the Year” in 2007 in Washington, DC, by the U.S. Small Business Administration, Jody has been a business reporter, editor, radio talk show host , and has won other state and national journalism awards. At the same time, she has helped corporate clients grow their businesses -- the basis for her practical coaching advice here. She also was the 2005 Athena Award recipient for her leadership role in mentoring other professional women. Jody will be talking with you weekly on TDS’ blog to share her insights and tips from the C-Suite perspective. Follow on G+.

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