Posts Tagged ‘Salary Negotiation’


The other day, while conducting a mock interview workshop, I asked the interviewee what compensation he was looking for. He proceeded to say that he needed at least six figures because he has two kids in college and alimony payments in addition to his mortgage payments. Now you might think that this is a reasonable approach, to determine what your obligations are and therefore what you need to earn.

However, your obligations have no relevancy to the company or to the value you bring to an organization. The reality is that whatever projects, processes and tasks you do for a company need to contribute to either the growth of revenue, the reduction of costs or the mitigation of risk. If your work is not helping the company in any of these areas, it is hard for a company to justify paying your salary. Therefore it is essential for you to understand how your work in impacting your organization.

In an earlier blog I wrote about 10 Tips to Optimize Your Career Security. This is the fourth instalment, Tracking Your Success. If you have followed the first tip and ask the right questions, you will understand how your projects and tasks fit into the needs and goals of your company. Once you understand this, establish Key Performance Indexes (KPI’s) relevant for your tasks and projects to measure your growth and performance. These can be in the area of time saved, improved efficiencies, improved productivity, and improved quality. You can then measure your performance against when you took over a position, or show year to year improvement.

Renowned management thought leader Peter Drucker is often quoted as saying that “you can’t manage what you can’t measure.” What this means that you can’t know whether or not you are successful unless success is defined and tracked.  With a clearly established metric for success, you can quantify progress and adjust your process to produce the desired outcome.  Without clear objectives, you’re stuck in a constant state of going through the motions

Not only do these measurements help your organization to understand your success, but it also helps you to understand your value. When you are able to articulate your success through quantified accomplishments, you demonstrate that you are aware of how your role impacts an organization, and that you are not just going through the motions, but striving for the success of the company you work for. You are no longer a commodity for the company, but a solution for their problems and a resource for their opportunities.

This blog is written by Greg Johnson of Above The Rim Executive Coaching

Gold Bars Image courtesy of ponsulak / FreeDigitalPhotos.net

 

In my last blog on answering the salary question in the interview, so many people wanted to know how to get around the salary question when filling out an online application. The unfortunate reality is that if you are going fill out online applications, you will need to answer the salary question. The best way to do this successfully is to make sure you research the appropriate salary range for the industry, function and geography. Three resources for researching this are:

However, by doing this, you are still playing by HR’s rules, opening yourself up to disqualification before you ever get in the door, and if you get in, severely limiting any negotiating position you may have. So what are you supposed to do?

Don’t rely on online applications. Stop focusing your job search on the job boards. Focus on the hidden job market! Stop being a Job Seeker, and start being a Solution to the problems of your target companies. Most people who are looking for work, market themselves as job seekers, follow the job boards, and send their applications and resumes into the great black hole. Why? Because those are the “opportunities” that they see. But 80% of actual jobs are in the hidden job market. Going through the hidden job market, you may still need to fill out an online application, but by then, the application is no longer a screening tool, but a formality because they are already interested in you. So how do you access the hidden job market? Next week I will discuss strategies for hunting in the hidden job market.

 

Last week in my blog, I discussed how HR’s question of “What are your salary requirements?” is counterproductive to finding the best employees to achieve the objectives and missions of the position they are trying to fill. Regardless of this fact, there is one thing you can almost guarantee. HR managers interviewing you will try to force the issue so that they can either eliminate you or pin you to a number so you lose any negotiating leverage. So how do you handle this? There are several issues to consider, and prepare for so that you can successfully navigate this area of the interview.

The first issue to resolve is, you need to know what your range is that you are looking for. While it should be irrelevant to the company what you need, you need to know for your own protection what your market value is. There are two components of knowing your market value:

  • Based on the objectives of the position, and based on your past achievements, what are you contributing to the success of the company? The best way to understand this is to look at your accomplishments in your past, and what did these contribute to previous companies in terms of helping the company generate revenue, reduce costs, or mitigate risks. Many professionals list these up in accomplishment statements often referred to as an acronym such as PARs – Problem, Action and Results. Identifying and understanding your previous accomplishments will help you understand your value to a company.
  • Research industry and function ranges for positions similar to the ones you are applying for. This will help you in responding to salary questions and also justifying your range you have determined for yourself.

In the interview itself, when HR asks this screening question, your goal is to defer this discussion until after both parties have determined that there is a good fit and they are prepared to offer the position. There are several ways to do this, and the key is to answer in a rational and non confrontational manner, along the lines of:

“There are so many components that go into my decision process of choosing a job, and salary is just one part. Once we determine that I am the best candidate to achieve the objectives of the position, I am extremely confident you will be able to offer a mutually beneficial and market competitive compensation package.”

If they do not accept this, but still press you, you can respond with:

I appreciate that you do not want to waste anyone’s time. What is the range you have budgeted for this position?” If they give you the range, you repeat the highest number and then be quiet.

If they still insist you give them a number, you can say something like:

Based on my current understanding of the position, objectives and expectations, I would expect the salary to be in the range of ______ to _______, which is within industry standards.”

Keep in mind that when interviewing, you are dealing with human beings. The only thing predictable about responses is that they will be unpredictable. While these types of responses are very effective in many cases, they do not always work. In addition, these are responses to salary questions early on in the interview process, and completely separate from negotiations at the time of an offer.

Finally, keep in mind that companies and HR are trying to commoditize employees and candidates. While this may make their job easier, as stated last week, it does not make their job more effective or efficient. The best way to get around this commoditization is to not approach as a job seeker but as a problem, and network your way in through informational meetings.

I am looking forward to getting your feedback.

 

“If I had known the budget range, I never would have applied. If the HR manager had known what I wanted to make, she never would have interviewed me. By the end of the interview process they were comfortable enough with what I can contribute, we were able to negotiate a salary that is good for both of us”. These are the words one client recently hired. It is a story I have heard repeatedly. On the other hand, I have heard so many times on early interviewers insisting a candidate say what their lowest acceptable salary is.

The other day, at a career fair and networking event, I had the opportunity to talk with a couple of recruiters. In introducing myself, I mentioned that I am a career coach. They asked if I was one of the people who coached job seekers to evade initial salary questions, and to negotiate salaries at the end. When I said “of course” they both said, that they hate when candidates do that. It makes them angry. I understand that HR doesn’t want to “waist time” with candidates that may be out of their range. However I would say that their focus forces them to “waste time” interviewing and hiring employees that will not bring maximum benefit and ROI to the company. I do not think HR as the time to waste on focusing so much initially on salary. Based on current practices, you end up with approximately 30% of the workforce underperforming and over paid, and 30% underpaid for their contribution. This leads to performing employees looking to leave at the first chance, and underperforming employees staying at the company continuing to drag down efficiencies and effectiveness of the company. The reality is, what a candidate wants or needs to be paid is and should be irrelevant to any company looking to hire people. Every employee needs to perform in a way that they help a company in one of three ways:

  1. Help generate revenue
  2. Help reduce costs
  3. Help mitigate risks

If the projects and tasks an employee works on don’t achieve one of those three things, there is no reason to pay a salary. Ideally, the employee’s contribution in these areas will be 3 to 5 times the value of their compensation. Therefore the process of the interview should be to:

  1. Find the best person to carry out the responsibilities and objectives of the position,
  2. Determine a mutually beneficial compensation package through past experience, including understanding their past accomplishments and contributions, and objectives of the position determine a mutually beneficial compensation package.

Therefore, I recommend when ask what your salary requirements are, I suggest you say something like “salary is only one component of my decision making process, and now cannot give a number. Once you determine I am the person who can best achieve the objectives of the position and the company, I am confident you can offer a mutually beneficial compensation package”

I look forward to your comments.

 

The first step in recognizing your personal brand identity is to understand what sets you apart from every other person competing with you for jobs. First, we are all created different. As I mentioned in the introduction we each have a unique set of skills, passions and experiences. We need to do a self-assessment to determine what those are. What are your motivating skills that really energize you when you are at work? Next, assess what your accomplishments have been throughout your career. In looking at your career, don’t think in terms of “I just did this process” or “I just did this task”. Every employee, in order to earn his or her salary needs to do one the following:

Think in terms of “In doing this task, I contributed this to the company. For example, rather than saying “I perform financial audits”, think about why the company needs you to prepare financial reports. In other words, the statement in a generic sense might change to “I reduce company costs and help the company operate more efficiently by performing financial audits”. The best indicator of success in a prospective position is past success. So, to take it a step further you need to develop specific accomplishment statements for what you have achieved throughout your career. These are often referred to as power stories or PARs (Problem, Action, Result) or STARs (Situation/Task, Action, Result), and can be generated by following:

Congratulations! You have your first PAR, or Power Story. Now repeat this process to create a bank of power stories that can be used throughout your job search as well as your career management. In my upcoming blog, I will talk about how these PARs and how you did them become the foundation for your branding.

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