Whether you’re taking a new job or contemplating asking your current employer for a raise, here’s what everyone needs to keep in mind for a successful compensation discussion.
- Don’t Underestimate Yourself: Know your value by taking the time to research what the average market compensation rates are for a position at your responsibility level. The most important rule is to remember that the first person to give away a number has less leverage. A good tactic is to throw the ball back in your employers court when asked about your salary requirements. For example: “well, I’m negotiable depending on the range you’re offering—is there a range you have in mind?” If they push you to share a number after this point, it’s great to have your own research-backed number. It’s also helpful to have data points to support why you deserve the pay raise listing out your expectations and how you’ve met or exceeded them.
- Be Exact with your Number: Research shows using a specific number in negotiations is more effective than a round number. Why? Asking for $62,945 rather than $63,000, for example, tends to indicate you’ve done extensive research into the market in order to come up with a number. The more informed you appear, the fewer rounds of negotiation you’ll have to go through. This isn’t to say that you should pretend to be prepared, go back to #1 above to insure that you’re prepared. Additionally, try to gather market research of what competitive compensation is like in your geographic area and for your profession.
- Timing is Everything: Timing is everything, especially when it comes to salary negotiation. It can be tempting to wait until your performance review, but it’s likely by that point they’ve already decided on (and budgeted for) your pay raise. If you really want your best shot, try going to HR or your employer a few months before the performance review, while they’re still setting budgets. Remember: You’re negotiating your salary for you. If the number offered doesn’t work for you, you have the power to walk away. Before going into negotiations, know where your cut off point is, and consider that your walking away point.
Side note: If you’re going for a pay raise make sure you understand your companies pay raise policies. Is it once year, bi-annually, quarterly or ad-hoc.
- Practice makes perfect: Especially if you’ve never done any negotiating before, practicing what you want to say will help boost your confidence. According to the Harvard Business Review, preparation is key to building confidence. And confidence improves performance at work, which could definitely translate into your negotiations. Ask a friend to sit across from you, record yourself, or practice in the mirror to really get your confidence across. But most employers expect you to, and you’re not putting anyone out by asking for more. And most importantly, you deserve the optimum salary, so don’t be afraid to stand up for yourself and ask for what you’ve earned!
- Never Settle or Get Discouraged: Today’s job market has never been tougher for employers to hire great team members. The average time to hire in the Bay Area trending over 45+ days for most technical roles so if you feel your offer is undervaluing your ability politely ask for more and don’t be afraid to walk away. Most of the leverage falls to the employee so don’t be afraid to ask. Remember success of your job search isn’t measured by the amount of offers you get but the quality of offers you receive. Staying positive and understanding the value you bring to an organization will make all of the difference whether it’s your first time negotiating salary or your 100th.
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