I recently interviewed with and received a job offer from a Fortune 100 company. As I went through the salary negotiation process I was surprised at my emotional reaction. Despite studying, practicing, and advising on salary negotiations for the past year and a half, my stomach was in knots. I was worried, second guessing myself, and having trouble sleeping near the end (the process took awhile). It really helped me understand the emotional toll my clients (and everyone) experience when they are in a high-stakes negotiation.
I’ll give you the play-by-play below as an example of how you could approach your negotiation.
The time between my first contact with HR to the job offer was about seven weeks. Three interviews had taken place with various levels of management. I received a call on Friday morning with an offer for the job. Before revealing my current salary to HR, I had asked them what their hiring budget was. The offer was the maximum of that hiring range, which was very nice, but based on my research, was still below market value for my skill set. They also offered a generous relocation package.
Step 1: Ask a ton of questions. Don’t respond to the offer besides expressing gratitude for it. Explain you want to talk about total compensation and ask about their benefit package: retirement, health care, bonuses, relocation packages, time off, and other perks. You need to understand the lay of the land and how the package you are being offered relates to what you currently have. You will most likely be referred to HR/benefits when you start getting in the weeds.
The company I interviewed with was very helpful in this regard. I was really getting into the nitty gritty with health care premium splits, dental coverage percentages, and how their pension benefits are calculated. They referred me to the subject matter experts around the company.
Step 2: Do you research. You should have done a little preliminary research about the market rate for your skill set before you received an offer, but I understand if you waited until you actually had an offer to do the research. I can be a time consuming process. I gathered data from seven sources: Payscale.com, Salary.com, Job Search Intelligence, Bureau of Labor Statistics, Indeed.com, Glassdoor.com, and SalaryExpert.com. I felt I could justify a request for $10,000 – $15,000 more than I was offered.
Step 3: Map out a strategy. What will your first counter-offer will be? What will your fall back positions will be? What series of alternatives could you propose? In my case my plan was to feel out whether the company would be interested in a pay-for-performance type model of compensation. If they were, I would propose some parameters. However that conversation went, I would still make a counter-offer of $10,000-$15,000 above their initial offer.
Step 4: Start negotiating. Ideally this would be done in person so you can gauge their reaction to your ideas (body language is 90% of communication). For a lot of people this is not possible and so the conversation happens over the phone. The company I interviewed with was across the county, so we talk ed over the phone. During my second conversation with the hiring manager (Monday morning – three days after the initial offer), I asked about the company’s philosophy and practice on giving raises and bonuses. Then we talked about the pay-for-performance ideas, which he said sounded interesting, but that they do not currently do anything like that. It did not appear there would be an avenue to set something like that up for the beginning. Next I spoke about the salary and said according to my research I thought a fair salary for someone with my skill set was in the [salary offered + $10,000 – $15,000] range. The hiring manager didn’t seem troubled by this and said he would speak with HR about seeing what they could do.
Step 5: Try not to go insane. Because the company I was interviewing with was so large, and because of the pace of the interviews, I knew it could be a few days before the hiring manager got back to me with a response. But that didn’t make the waiting any easier. Have confidence that you are their preferred candidate and that they are doing all they can to give you an acceptable offer – they don’t want to lose you after all the work they’ve done!
Step 6: Go back and forth until you reach a deal or need to walk away. Have a slew of if-then scenarios planned out. If they offer this, then you will do that. Think about all the possible outcomes and try and be prepared. What happened with me: after giving my counter offer on Monday morning, I didn’t hear back from the company until late Tuesday afternoon, this time from the hiring manager’s boss. He asked how things were progressing with the offer and I explained what I had discussed with the hiring manager the day before. The hiring manager’s boss explained why they couldn’t hire above the budgeted amount, that the company is not that great at giving large merit increases, but that they are very good at equity adjustments and that he would be very surprised if I didn’t receive an equity adjustment of $10,000 – $15,000 in six to nine months. I asked if I could get that in writing. He said no =). He also pointed out the generous relocation package is something that is not usually offered. I countered again that if they could not increase the salary I would need a sizable signing bonus. He asked how much? I gave him a range and he said he would look into it.
Step 7: Stay patient and keep your cool. This is really hard to do. You’ve invested 100s of hours preparing, interviewing, and thinking about all the possibilities. Did you ask for too much? Are they going to withdraw their offer and go with their second choice? Why is it taking so long? In my case I received a call from the hiring manager the following afternoon with an offer of the signing bonus I asked for, plus $2,000. I felt like that was an offer I could accept, and happily did so. Whew!
Negotiating salary is a very stressful process and I was reminded of that fact again by going through it myself. Please reach out to me if you have any questions about your situation or need someone to bounce ideas off of. I’d love to help.