Negotiate for your Best Offer
At the executive level, you have built the confidence and experience to where you fully understand your value to an organization. However, even the most experienced executive might feel some hesitation when it’s time to start salary negotiations. It is completely normal to feel some trepidation during this stage of the interviewing process. Here’s where the following quick tips can help you:
- The company pays you for both your overall experience and the specific skills you have that are relevant to its unique situation. If your expertise is rare, your position to negotiate is strengthened.
- If working with an executive recruiter, let them act as a buffer during the negotiations. Many offers are ruined during the delicate art of negotiations if things are not handled properly; an experienced recruiter can make sure everything is framed appropriately from both sides of the table. They also increase your odds of getting what you deserve and ask for as they are relaying this information throughout the process and not just at the last minute.
- Is your potential employer a small privately-owned company, or a company that runs on venture capital, a large corporation, or a public sector employer? Depending on how large the company is, you may have a fair idea of how much it can afford to pay its executives. While it’s true that large companies may have more money, they usually have more policies, procedures, and bureaucracy as well. Hiring managers in large companies often have to work with fixed budgets and may not have a lot of latitude to offer larger salaries upfront without the appropriate approvals, while smaller organizations may have more flexibility in decision-making and can do so quickly.
- Know your current numbers. Do you really know what you make now? Of course you know your base & bonus, but have you added up the value of your entire current compensation package? Write it all down and don’t leave out any components. These numbers will be invaluable when it comes time to negotiate. Some often overlooked elements are car allowance, tuition contribution, profit sharing, equity or stock option value, 401k contribution, commuting / parking, insurance premiums, cost of living, and taxes.
- Ask your recruiter or the HR person for a benefits sheet or for a rundown of the perks and benefits of the new company. Do they offer big bonuses, perks, LTI’s, use of company cars, or reimbursement of various expenses and so on? Factor those benefits against your asking for salary and negotiate smartly. If your base isn’t where you feel it should be, it may be because the employer realizes that the job is going to provide lots of other high-value benefits. You must look at the full picture and its a good idea to do some due diligence and calculate the full value of the package before you make a decision.
- When working with a trusted recruiter, be completely and brutally honest. Let them know specifically what it will take to get you to make the move. Trying to wait and see what the company offers you first can often backfire with an initial low offer that will offend you. The recruiter can’t make an accurate suggestion to the company if they don’t know your real expectations.
- Be willing and prepared to negotiate. Rarely will a company make a “take it or leave it” offer, usually there is an expectation for some back and forth exchanges to ensure the numbers will work for both parties. Don’t get offended if the initial offer is lower than you hoped for, especially if you haven’t made your expectations clear. Be honest with how far they are from the mark and be creative in how you can make up the difference immediately or over the long-term.
- Keep realistic expectations. Guaranteed contracts, house buying options, and other incentives that used to be fairly common, are rare these days. Make sure you keep your desires flexible and realistic.
- Communicate quickly and negotiate in good faith. If you know this is something you won’t say yes to, don’t waste anyone’s time. Pull yourself out of the running. Keep your recruiter in close contact and let them know what other competing offers you may have so they can monitor how quickly to push the company to keep the ball rolling.
Have you ever had a major curve ball occur during the negotiations stage? What happened?