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Friday, May 1, 2009

Do You Suffer From Premature Negotiation?

Ways To Hurt Your Compensation Potential During the Job Interview
by Steven Brown

This week was full of reminders how easy it is to give up power in negotiation for your compensation. I taught an Effective Negotiation Skills workshop and one of the examples I use is an interview scenario where the interviewee is asked "how much do you make?" After a negotiation course, or in my coaching sessions, I universally hear people gasp when they realize how they've been played. Through good intentions, and lack of awareness, many people cooperatively give information, giving up significant power and flexibility in the real negotiation at the time of the job offer.

What Is Premature Compensation Negotiation?

The quick answer: any giving of information about your current compensation, or willingness to agree to any of the terms, before the job is offered in writing. The key triggering event is the written offer. This can be in an email, a scribbled note, or a formally presented letter of offer.

Until you receive some form of written offer, you don't have an offer. It is that stark. Some people get tricked by the "verbal offer". But until it's in writing, you don't possess an offer. And possession is what then hands you the power to accept or reject the offer. It is only when you have that power that you can negotiate.

Why Can't You Negotiate Before The Offer?

Well, you can attempt to do so. But then your not really negotiating over the job offer. Instead, you're simply looking for recognition. A premature move is really just a request to acknowledge other power: credentials, successful job history, high compensation, attractive spouse, fast boat, etc. You might even have top notch clothes and a perfect set of teeth! You're really just trying to get them excited about you - and there's nothing wrong with THAT!

Except when that request for recognition hurts your written job offer. If your real reason for meeting with these people is to advance your career and compensation, then you have to carefully choose what will maximize their attraction to your strengths, versus give away information that limits you later.

What's An Example of Premature Compensation Negotiation?

Q: What's your salary?
A: I make $125k
Comment: they might have paid you $160k, but why should they now?

Q: Will you be moving if we offer you this job?
A: I might have to move near here whether I get the job or not.
Comment: Why should they offer to pay for the move?

Q: This job range is $80-90k. Will that work for you?
A: I'm OK with that
Comment: Well, there you go

Example of a way to respond instead:

Q: How much will you require to accept this offer?
A: I usually discuss compensation when you are ready to hire me - are you offering me the job?
Comment: focuses back on the process of deciding to find the win/win

How Do You Handle Premature Compensation Negotiations?

Ah, that is THE trick. Because these questions are usually very difficult to avoid - in fact, every HR person is required to ask these questions! - it can feel very aggressive or uncooperative to not give the information requested.

And therein lies the problem. These hiring professionals are out to save the company money: your compensation, and the costs to find the right candidate and get them on board. There's a certain amount of cooperation you'll need to exhibit or you won't even get in the game.

You'll have to use your judgment on that. And the more flexible you are, the more you can resist such questions.

Actually the best way to handle these questions is to deal with the hiring manager. It is nearly universal that the screeners and HR helpers are the ones wanting you to pre-negotiate. When you work with the hiring manager, it is more likely you can manage the dialog and focus on what they need and what you bring.

Needless to say, there's a school for hiring staff on how to manage interviews. You need to understand these dynamics too, and that takes study and practice. The first step is understanding how to recognize the games. The second step is learning how to handle their tactics. Fortunately, whenever you feel confused or under pressure, you can always refocus on what they're looking to hire, and what you bring to the party.

Conclusion - Focus on Value

That is the universal way to handle such difficult questions. Focus on the value you bring to the position, and what's valuable about the opportunity to you. Then ask them to make an offer in writing, and you'll "give it your full consideration." Anything else, and you risk giving away information unnecessarily. When you're forced to do so, then just understand that you're making the choice, and accept the consequences. Move on and keep focus on win/win outcomes.

1 comment:

JobSearchNinja said...

One thing to remember is that salary ranges are all very well, but the key to maximizing your compensation is about clearly demonstrating the benefits that you can bring to an organization. A well-documented performance which provides a prospective employer with quantitative results and shows him how you solved problems or accomplished tasks is pretty tough to argue with!

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