Negotiating an Offer

Normally I talk about a hiring manager making an offer. My advice to hiring managers is:

  1. Determine the candidate's salary range during the phone screen. That way you know if the candidate is in the ballpark.
  2. Before making an offer ask the question, “What would make you say yes to an offer from us?”
  3. If what the candidate wants is reasonable, make the offer. Make sure this offer is the best offer you can make for this candidate.
  4. If you've made your best offer, don't negotiate further.

This works. But sometimes, the candidate doesn't feel safe enough to adequately answer the second question. When that happens, or when the hiring manager doesn't predetermine salary and other requirements, the entire pay package, you're left negotiating the offer.

Some people have funny ideas about negotiating. They think the person who first mentions a number is the weak one. I don't buy it. If you're a hiring manager and you know what value you want for the organization and what you're willing to pay for that value, you can stand behind your number. Similarly, if you're a candidate, and you've thought about your value to the organization, you can stand behind your number too. So don't be afraid to answer a salary question ? either of you.

In this economy, it's possible that money is the only compensation candidates want or companies want to pay. However, that's unlikely. Certainly in better economies, candidates want more than just money. Some candidates want tuition reimbursement or stock options or specific work hours or specific work experience. All of those things can be negotiated as part of a pay package.

If you're a candidate, think hard about what you want as a total pay package. Sometimes in my career, I wanted to know I could complete work by 5:30pm, so I could make it to daycare before it closed. Sometimes, I wanted to know I didn't have to start until 8:30am so I could work out. Sometimes, I needed part of an afternoon off to complete my Master's degree work. One of my employees wanted to take the summers off (yes, July and August) every year. He was worth paying for 10 months even though he took two months off each year. Remember, you're looking for a total pay package.

Hiring managers, if you're worried about giving people time off without pay or any of the other possibilities, think about why you're worried. People have lives. You can pay slightly less, if you really think the candidate won't be giving 100% at work. In my experience, if you and the candidate agree on the value the candidate has as a full time employee, then you can negotiate the fine points of what the candidate wants.If you haven't read “Getting to Yes” by Fisher, Ury, and Patton, read it. It's very helpful to understand the principle behind negotiations as opposed to the stands people take in a negotiation.

Thanks to Allen for prompting this blog post.

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