When I was first offered my current position, it came with a standard salary raise. I was not impressed. I countered with a much higher salary, but after much deliberation, the offer was not increased further. Since it was an excellent growth opportunity within the company, I still accepted the job.
Six months into my new role, I was given an additional team to manage. I approached my manager for a salary re-negotiation. Though I got one, but it was so small, my biweekly paycheck went up by only about $100. I accepted it at the time, but in retrospect, still regret that I did not negotiate further.
Knowing how to negotiate your salary is a valuable skill that can increase your earning potential throughout your career and better ensure you’re fairly compensated for the value you bring to the table. In this last post of the Dream Job Search Bootcamp, I want to share with you my learning from this salary negotiation experience, both what I did right and could have done better, so that you can prepare well for your next salary negotiation. Make use of these tips whether you are seasoned industry professional starting your fifth job, or a new hire negotiating your starting salary.
What I did right
Do your research
Before proposing a counter to the salary offer I got, I did my market research. It is important to know both how much the position is paid on average in the industry as well as how the salary stacks up in your own company. I have noted that people in the US are not really comfortable sharing their salary details. However, in my experience, friends/mentors at work may be willing to share a salary range with you. You can then apply an intelligent ‘markup’ on it to account for the difference in the value that you bring to the role.
That’s exactly what I did to get an idea of the departing manager’s salary. To understand the industry average for engineering managers, I found job sites like Glassdoor, Payscale and Indeed as excellent source of information. You will find that several employees from your company, some even holding the exact job title, would have shared their salaries anonymously on these sites.
Ask or more than you want
Once I had established a range through market research, I asked for a salary that is towards the top of that range. This allowed room for negotiation so that I stood a higher chance of getting a salary that is greater than the minimum I would like to accept.
I also made the ask specific. According to one research by Columbia Business School, people making a precise offer are perceived to be more informed. So, instead of saying “I would like a higher salary”, I said “I would like a 12% raise instead of 8%”.
Re-negotiate when job scope changes
Six months into my job, I was given the responsibility of another team. All of a sudden, I was managing twice the workload, and three times the stress. I had a solid case for re-negotiating my salary as well as the blessings of my manager to support my request.
Job requirements are typically never static. When the scope of work changes, meet with your manager to revisit your salary. If you have made yourself indispensable through great work, chances are your request for a raise will be honored.
Remember, if you don’t ask, you don’t get!
Think beyond compensation
For every job offer I have received, I have thought about what is the added value of this job beyond paying my bills – is it intellectually challenging? Does it help me build my professional network? Does it help me build skills needed to achieve my 10 year career goals? Or does it give me greater flexibility to manage my young family?
Your reasons may differ based on your career and lifestyle goals. They may also change over time as your personal situation changes. But to build a happy and fulfilling career, it is important that you think about your intrinsic motivators, and not just the compensation. This time around, the job offered me a chance to manage a P&L as well as a large team, which is a huge addition to my skills toolbox.
Where I failed the salary negotiation
What’s your BATNA?
One of my favorite classes during the MBA program as Negotiations, where I learned about the concept of BATNA. Coined by Roger Fisher and William Ury in their 1981 bestseller, Getting to Yes: Negotiating Without Giving, it stands for Best Alternative To Negotiated Agreement. It is not your ideal outcome; it is the best you can do if the other party refuses to negotiate with you. If the proposed offer is better than your BATNA, you should take it. If it is not, then you should continue to negotiate or consider pursuing your alternate option. As an example, if you are offered a salary of $85k from employer 1, and you have an alternate offer for $80k from employer 2, everything else being equal, you should take offer 1 as your BATNA is weak.
In my case, my alternatives to the salary offered were either to stay stuck in my previous role or to find a job with another company, both options that did not work in my favor. Due to a poor BATNA, my leverage for negotiating a higher salary was limited.
The imposter syndrome trap
The struggle with imposter syndrome is real! I have graduated at the top of my class, earned an MBA, done consistently well at work and now lead a large global team at a much young age than several of my peers. Despite these achievements, I occasionally suffer from feeling of intellectual fraudulence and self-doubt.
When my job scope changed and I was offered only a tiny salary raise, I remember thinking to myself, “If I re-negotiate the raise, I will offend people by over stepping boundaries and asking for more than I deserve.” This type of thinking is completely self-sabotaging, something I try to be consciously aware of moving forward.
Wrapping up – is salary negotiation worth the fight?
There’s no doubt that you must negotiate your salary at the start of a new job, when the scope of work changes, and atleast every couple of years to ensure you are not losing money to inflation. However, sometimes the final salary offered may not match your expectations. At that time, the key question to ask is “Is this job worth more to me than just the compensation?” If the answer is yes, continue to do excellent work and make the best of it to further your career progression. Otherwise, it’s time to brush up your resume and put yourself in the market!