AJO Blog

Primary tabs

Are You Leaving Money On The Salary Negotiation Table?

on

October 8th, 2019

- Updated on

October 22, 2019 - 2:15pm

"A$K AND YOU $MAY RECEIVE" 

“Only when you ask do you have a chance to get more. You need only learn what to ask for and how to ask for it in a reasonable way.”
Over the 21 plus years that I have been serving as a career consultant, I have discovered both a very sad truth and a very powerful revelation relating to the acceptance and negotiation of a job offer.
 
Too many professionals leave money on the salary negotiation table. 
 
I discovered this reality by systematically questioning each and every person with whom I've worked. These professionals have represented virtually every industry, function, salary level and age. Most have had, on average, 3-6 job changes wherein they were presented offers. Also, as hiring decision-makers, the same individuals have had the experience of offering jobs and money to others anywhere from 10 to 600 times. 
 
In short, most have had experience on both sides of the offer negotiating table. 
 
Salary negotiation
Knowing this, I sought to understand what was going on in terms of their thinking, perceptions, feelings and actual behavior. I discovered what I now know by simply asking privately everyone some questions. I continue to do this to this day, reality checking my discoveries to see if there is more to learn.

Why Don't We Ask for a Higher Salary When Accepting a New Position?

The following is the procedure that I used to find out. 
  • First, I asked each professional how many times in their career did they receive an offer that they accepted. Then I asked, in those instances, how many times did they change the initial money offered such that they received more money. For example, one would offer that they were offered $120K initially. Before it was over it became $130K. I asked how and why it happened. In all cases that they got more money, they got the extra money because they said something; this is, they spoke up. In one way or another, they essentially said something to the effect of "Can I have more money?”. 

    The sad truth I discovered is that 90% of the people rarely (not usually) asked for more and hence got no more than the initial money offered.  

    When asked why they did not ask for more money, they cited reasons such as ignorance (not knowing that they could ask or what or how to ask), fear, or happy acceptance with the initial offer (they did not feel they needed to ask for more). I know of only one person who went 3 for 3 in his career on receiving offers and getting the initial money moved up. 

  • Second, I questioned the job-seekers regarding their experience as hiring managers. I asked each to approximate how many times they offered jobs and money to others. I asked how many times was the initial money offered changed upwards (the individual received more money than initially offered). 

    Most of the time it was confessed that is was a rare event that the money was changed upwards. When it did happen, I asked why. Unanimously they testified that it was because the candidate "said" something, basically asking for more. I then asked if there was extra money available, at the time of the offer, in case the candidate asked for more. Unanimously, they said "yes". Was the money earmarked specifically for the candidate? They collectively admitted that it was.

This is deeply important to grasp for individuals facing possible offers because evidently the money is there and is there specifically for you in case you ask. It is not money that has to be found, transferred, borrowed or created. The extra money is there but "out-of-sight" physically and, more importantly, psychologically.
 
The fascinating human paradox here is that the same person, having had experience on both sides of the table, rarely put the two experiences together for themselves when they were facing a new offer. To prove this again, take yourself through these two simple exercises. The high probability is that you did not change upward most of the offers you received, and, when you offered jobs and money to others, rarely did you have to give more, yet you knew that there was more there in case the candidate spoke up. If your experience has been different on either side of the table, you sit virtually alone with that experience. 
 
Now that I have uncovered the sad truth; that is, most professionals have not gone after the precious extra money that was set aside for them, what about the powerful law? The compelling law at work here is that “extra money can be gotten at offer time only if you ask for it". It sounds so simple, yet it is so woefully unapplied. The other discovery I made is that most people do not have the confidence at "showtime" to ask or they are ignorant of exactly how and how much to ask for. I will suggest a solution to both issues.

Question What Salary Should You Ask For?

Part of the problem is not knowing how much to go for. 
 
Here are some guidelines that I use every day: 
  • Up to $90K, go for up to $5K extra 
  • From $95-125K, go for up to $10K extra
  • If offered over $125K, go for up to $15-30K extra or more even depending on the level and your courage/confidence level.
The higher the initial number is, the greater is the “extra” money available. What is built into these numbers is what can be called a "fear factor"; that is, the fear that if you ask for too much you will lose the offer. To date, not one individual even came close to losing an offer following these guidelines. These are acceptable, reasonable numbers. 
 
If you need to negotiate in terms of hourly rates, you can go for $2-5/hr. more depending upon the situation.

How Should You Ask for More Money?

How to ask for more moneyNow that you know what to go for, how do you go for it? 
 
I have evolved, through trial and error, the "magic" sentence. When pronounced, together with the suggested numbers to use, will get you more money most of the time. The deep psychological value of the sentence (or the act of asking for more) is that, even if you do not get extra money, you will never have to live with the regret of not having asked or wondering how much you could have gotten if you had asked.
 
The "magic" sentence is to be used immediately after the money has been announced to you. This is usually done in person or over the phone. When you are offered a job and the money is presented, reply by saying
"Thank you for selecting me, this looks like a good match-up, I feel comfortable about working with you and the others that I have met, and I should have no problem with the start date.......in terms of "x" (repeat the actual money number offered).
Pause a second or two).....
"The position does require a lot. I know how dedicated I am when I apply myself and I am confident that I will make an immediate positive impact. Would it be unreasonable to ask you to move the number closer to "x plus"?" 

Use the guidelines above to arrive at the number. For example, if offered $125K, suggest moving the number closer to $135K; if offered $205K, suggest closer to $235K. Most of the time the number is moved upward and curiously the number you suggested is selected, not a number closer to that number.

What if the answer is "no"? 

It happens, but not often. Simply reply by saying
"I know how much has to be done in the position.....how about a 'token' move in that directions?" 
A "token" is the number plus $2-5k depending on the level. Many times the employer will concede a "token" increase. If again they should say "no", simply end it with asking for an early review in 3-6 months. They will concede this 99% of the time just to end the ordeal of hiring.
 
It does take a little practice to get the "magic" sentence down so that it comes off natural, easy, and appearing sincere. The bottom line here is that it works most of the time to get more money, and it always eliminates the post-offer remorse or regret effect. The latter alone is worth the effort.

Conclusion

In conclusion, virtually every employee at whatever level has left significant monies at the negotiating table, and many have done so repeatedly. The extra money was always there, was there for the individual in the event they asked for more. I have provided a way to conjure up the confidence and a reasonable way to "go for it". 
 
I can think of no better, more truly rewarding outcome than a successful salary negotiation resulting from a career coach's expertise. I personally love being able to put more money in people’s pockets. One can take this information to the bank smiling. 
 
Today with any browser you can usually get a sense of what the position is paying. Just type in “title at xyz salary range” and you will get enough hits to figure out what` the position in question is paying. You may also wish to check-out How to Leverage the Library & Internet For Your Job Search Research (scroll to the bottom of the post for several recommended salary research resources.)
 
By the way, the exact same rule applies to each and every annual review that you experience. Each review is a critical event to “change the number” to your advantage using the same principle and understanding. The language adjustment would be as follows:
 
“Thank you for the positive review and the increase…I have contributed significantly this past year (briefly mention one or two critical accomplishments)….in terms of (repeat their increase number or percentage)…would it be unreasonable to ask you to move it closer to (here think in terms of going for $1000 or 1% more as a guideline)?…because I will continue to contribute to the strength of our department and support your goals.” 
Some companies are adept at staging the review in a way that suppresses the thought of speaking up. You must speak up at least. If you should get no accommodation at this time, watch what you get the next time.  

AJO Career Coach Nat CaputiNat Caputi has taken over 3000 and counting professionals through “the jungle” and drama (trauma) of job transition. He style is urgent, high-touch, energetic, and focused on results. His Ph.D. in human behavior allows him to be tuned into the subtle aspects of the search process and he is always curious as to the market feedback of actions because, if something is not working, it is his responsibility to figure out a more effective approach. His experience covers virtually all industries, functions, salary levels, and every career stage.