Get Paid What You're Worth: The Expert Negotiators' Guide to Salary and Compensation

Get Paid What You're Worth: The Expert Negotiators' Guide to Salary and Compensation

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Overview

Begin getting paid what you're worth—-today!

Couldn't you use more money? Whether you're entering the workforce for the first time, making a job change, or seeking better compensation for your contributions, Robin L. Pinkley and Gregory B. Northcraft will guide you step-by-step toward getting exactly what you deserve.

- Learn why there may be more money available for you than you think.

- Get the confidence to turn your strategic thinking into specific action.

- Benefit from a panel of negotiations experts and their decades of experience.

Applicants who negotiate job offers receive salaries and benefits of significantly more value than those who do not. And the compensation package you negotiate today will affect all your future job offers. Shouldn't it be the best that it can be? Get Paid What You're Worth is the handbook you need to successfully navigate the business of negotiation.

Product Details

ISBN-13: 9780312302696
Publisher: St. Martin's Press
Publication date: 03/01/2003
Edition description: First Edition
Pages: 208
Sales rank: 645,358
Product dimensions: 5.50(w) x 8.50(h) x 0.47(d)

About the Author

Robin L. Pinkley is Chairman of Organizational Behavior and Busines Policy for the Cox School of Business at Southern Methodist University, as well as the Director of the American Airlines center for Labor Relations and Dispute Resolution.

Gregory B. Northcraft is a professor of Business Administration and Labor and Industrial Relations at the University of Illinois. He has consulted for such corporations as Hewlett-Packard, Motorola, and Walt Disney World. He is coauthor of Organizational Behavior: A Management Challenge and the current editor of the Academy of Management Journal.

Read an Excerpt

Get Paid What You're Worth

The Expert Negotiator's Guide to Salary and Compensation


By Robin L. Pinkley, Gregory B. Northcraft

St. Martin's Press

Copyright © 2000 Robin L. Pinkley and Gregory B. Northcraft
All rights reserved.
ISBN: 978-1-4668-8003-0



CHAPTER 1

If You Want It, You'd Better Negotiate for It


Chris put down his Wall Street Journal and replaced it with A Tale of Two Cities, by Charles Dickens. He hoped reading an old favorite would distract him and help him relax a bit, although given the ache in his back, he wasn't hopeful.

"It was the best of times, it was the worse of times ..." he read over and over.

"Yes, it is ...," he said aloud, as the issues he was trying to escape came back with a flood of emotion. The last two months had been an emotional and physical roller coaster. One moment he felt poised for success and the next as worthless as a 45 in a CD player. "How did I forget how time-consuming and stressful it is to be on the job market?" he wondered.

The last twenty-four hours had been stressful and exhausting. Last night he had forced himself to shove a burger down his throat as he searched the web for information to add to what he had learned from Allied Products' annual report. He had gone to bed early only to toss and turn all night.

This morning had been a blur of coffee, burned toast, and a pretense of composure while he knotted his tie and made a mad dash to catch the train into the city.

"Get hold of yourself, man" he told himself. "They will be lucky to get me ... they will be lucky to get me," he repeated to himself over and over like a mantra. "I have great credentials, three years of related work experience, a good salary history, an M.B.A. from a top business school, and a firm handshake. Just remember," he told himself as he walked in the front door of the skyscraper, "this interview thing is a two-way street."

AFTER YOU READ THIS CHAPTER, YOU'LL KNOW:

• Why you must negotiate

• The lifetime of benefits you gain from this all-important negotiation

• Why job applicants often don't negotiate


Why You Must Negotiate


Job applicants negotiate because they want to walk away with more than they are initially offered. They want the final deal to include everything the company is willing and able to give them. We wrote this book to provide you with a foundation for understanding how to claim more of what's at stake in your negotiations.

Imagine that an employer has $100,000 left in the budget for a number of things, including hiring a new employee. Employers know that the less they spend on a new employee, the more they will have left to spend on other things or the better their profit figures will look for the year. Thus, employers negotiate with job applicants to try to keep as much of that $100,000 in reserve as possible. Of course, job applicants want to do as well as possible for themselves. If they knew there was $100,000 available, they would want to get as much of it as possible. Both employers and applicants want to claim as much as they can of the $100,000 at stake. But claiming value requires that we exchange value.

When you accept a job offer, you exchange your education, experience, expertise, and effort for the salary, benefits, opportunity, and even friendships associated with the job. Ultimately each party in the negotiation must decide how much value he/she must claim to justify the exchange.

Job applicants who negotiate what they will get in exchange for the work that they do receive salaries and benefits of significantly greater value than candidates who do not. While most employers prefer that you show up on the first day happy and committed instead of disappointed and disillusioned, few will compensate you more than they need to. In fact, employers routinely will offer you less than they ultimately expect to compensate you with the expectation that you will negotiate. Of the employers we surveyed, 100 percent told us that it is acceptable for job applicants to attempt to negotiate a job offer. Of these employers 90 percent told us that their initial offer was less that they were willing to pay because they expected the applicant to negotiate. For example, when we told employers that their top applicant would

Reject an offer of $35,000

• Accept an offer of $38,000, with dissatisfaction

• Accept an offer of $41,000, with satisfaction

• Accept an offer of $44,000, with pleasure

• Accept an offer of $48,000, with great pleasure,


50 percent said that they would offer the applicant an amount that would lead the applicant to accept and be satisfied (a salary of $41,000); 40 percent said they would offer the amount that would lead the applicant to accept and be happy ($44,000); and another 10 percent said they would offer only the amount required to produce an acceptance, even though the applicant would be dissatisfied ($38,000). In each case, they told us that they would ultimately pay more to get this applicant if the applicant negotiated, but that they would be delighted to get the applicant for less. Bottom line: If you want something, you had better negotiate for it.

One study found that men who negotiate receive 4.3 percent higher salaries than men who do not, while women who negotiate receive on average 2.7 percent higher salaries than women who do not. Despite the fact that few of the applicants in that study had received training in effective negotiation, those who negotiated were more successful than those who did not.

Though it is unclear why the women in the study benefited less from negotiation than did the men, many recruiters tell us that women use less assertive tactics than do men. In this book, we will explain how to use tactics that are tough when it comes to the issues, but gentle when it comes to the people involved.


A Lifetime of Benefits

The compensation package you obtain today affects your life today and tomorrow. As you may know, applicants with work experience are almost always asked for their salary history. Employers request the information for two reasons: (1) to determine how much they need to pay you, and (2) to see how you compare to others in the same market.

Applicants with identical experience and performance records but different salary histories are rated differently by employers. If your compensation record is better than others, employers will assume that your performance record is better too. Salary history sends a signal that profoundly effects performance reviews, raises, and job offers — for years to come. Make it a goal to enter an organization or job market making no less than other applicants. Accepting less will imply that you have less value than other new hires.

Even we were surprised when we calculated the total cost of not negotiating over a man's or woman's career. Assuming (1) a base salary of $50,000, (2) a mean annual pay increase of 3–4 percent, (3) a change in job every eight years (conservative given that most people change jobs more often on average), (4) a fifty-year career, and for comparison, including the 4.3 percent salary boost traditionally obtained by men who negotiate, and the 2.7 percent salary boost traditionally obtained by women who negotiate, we found astonishing benefits for those who negotiated over those who did not.


THE BENEFITS OF NEGOTIATING

• Men who negotiate will receive $1,714,779 more in the course of their careers than those who do not.

• Women who negotiate will receive $1,040,917 more in the course of their careers than those who do not.


If you don't negotiate, you might (1) accept a good job that could have been a great job if you had negotiated or (2) turn down a poor job that could have been a good job if you had negotiated. Without negotiation, your choice will be based on incomplete information. The only thing harder than comparing apples to oranges is comparing half an apple to an orange. Yet this is exactly what you do when you fail to negotiate an offer. Avoid this trap! Claim the best available job with the most value — through effective negotiation.


Why Applicants Don't Negotiate

Only 50 percent of the applicants we surveyed said that they had negotiated their last job offer. Recruiters told us that in reality only about 25 percent of applicants negotiate. After doing everything in their power to land the job, many applicants make one of two post-offer mistakes:

COMMON POSTOFFER MISTAKES

• Gratefully accepting the offer without negotiating

• Negotiating without considering other options or generating alternatives

It may seem easy to simply say yes, but this strategy is shortsighted and costly. So why don't more applicants negotiate the offer once they have received it? We think the answer has to do with fear.

JOB APPLICANTS' MOST COMMON FEARS ABOUT NEGOTIATION

• Fear of the employer's perception

• Fear of losing the offer

• Fear of conflict

• Fear of the employer's superior power

• Fear of emotion

• Fear of negotiating poorly

Fear of the Employer's Perception. Applicants often fear that negotiating will make them appear cheap, selfish, cocky, ungrateful, or (shudder!) more concerned about what the employer has to offer them than about what they can offer the employer. We asked corporate headhunters and placement officers which of the following job applicants they would find the most impressive:

WHO IS THE MOST IMPRESSIVE?

• The applicant who accepts an offer as made

• The applicant who negotiates the offer in a professional, problem-solving manner

• The applicant who negotiates the offer in a demanding manner


Eighty percent told us that the job applicant who negotiates in a professional manner would make the best impression. Only 20 percent said they would be most impressed by the applicant who accepted the offer as made. Applicants are perceived more favorably if they negotiate well than if they do not negotiate.

Fear of Losing the Offer. Job applicants tell us that they are afraid they could lose the offer if they don't accept it as it is. We asked employers if they had ever revoked an offer, and if so, why? Only 30 percent of the recruiters, headhunters, and placement officers we surveyed had ever seen an offer revoked. In no case was an offer revoked because the applicant had negotiated. Instead, offers were revoked because an applicant had misrepresented his or her qualifications or because the applicant dragged the negotiation out so long that the circumstances changed and the position was no longer needed. Offers are not revoked because a job applicant negotiates but because of how the applicant negotiates.

Fear of Conflict. For many job applicants negotiation implies conflict. They assume that the only way they can win more in a negotiation is by making the other side lose something. But this doesn't need to be the case. As you'll see in chapter 4, effective negotiators know how to find enough value for all parties in a negotiation.

Let's say you and a friend decide to go to a movie but you disagree about which movie to see. You've got three choices: (1) You can debate for hours and miss the movie (a poor solution because no one is happy); (2) one of you can choose the movie this week and the other next week (an acceptable solution but one that requires that each of you see a movie you are not interested in); or (3) you can each explain "why" you made your selection and look for an alternative that fulfills both of your underlying interests. If you selected your movie because you are in the mood for a comedy and your friend selected his/her movie because of the director, this discussion could allow you to select a third choice: A comedy directed by the preferred director would allow you both to get what you want. This example illustrates that effective negotiators can be firmly committed to getting what they want but still allow the other side to get what they want too. The other side doesn't have to lose in negotiation in order for you to win.

Fear of the Employer's Superior Power. More often than not, applicants feel that employers have all the power in contract negotiations. This is a misperception. Getting an initial offer from an employer means that you are their preferred applicant. The negotiation begins when you have been asked to join their company but you have not yet accepted. You might be surprised to find out that employers often believe that it is the applicant who has more power! In fact, recruiters tell us that they feel downright powerless when their preferred applicants have competing offers. We will talk more about power, the role it plays, and how to create it in chapter 6. In the meantime, it takes two to negotiate. Remember that no one can force you to accept an offer. Ultimately you have control over what you accept and what you reject. And that's power.

Fear of Emotion. Many people fear that the negotiation will get emotional and as a result too personal. Negotiation does not have to be personal. Conflict is a less likely product of negotiation if you remember to make the negotiation about the issues — not about the people. Fear of emotion leads to inaction and the tendency to settle prematurely. Inaction means both lost value and a lost opportunity to make a positive impression.

Fear of Negotiating Poorly. This is the only fear that seems justified to us. The desire to negotiate well is not sufficient. You need to know how to negotiate well. Fortunately, the doctors are "in" and we have the cure. The cure is this book, so read on.

• Negotiation determines how much an employer is prepared to give you and how much you obtain. Only by negotiating can you know which job is really the best job for you.

• Applicants who negotiate their job offers receive salaries and benefits of significantly more value. This becomes very important over the "life of the employee."

• The compensation package you obtain today affects your life today — and also your future job offers. When you get a job offer, you must negotiate.

CHAPTER 2

Before You Receive an Offer: Building a Foundation for Success

Sara had tried not to corner Chris the minute she got home from work. She was itching to find out about his interview, but didn't want to push him in case it had not gone well. Finally she could contain herself no longer.

"So how did it go?" she blurted out.

"Wow, you lasted twelve full minutes before you cornered me. That could be a record," Chris said with a smile. "I think it went pretty well, all things considering," he added.

"Considering what?" she asked with concern, as she moved to give him a protective hug.

"Well, considering they ended the day by pairing me with four other candidates who all want the same job. They herded us into a room, told us to act like a team, gave us a problem to solve, and then reminded us that only two of us would receive an offer. Can you believe it?" he asked. "They told us to act like a team, only to remind us that we were in competition with one another. It makes you wonder, doesn't it?" "Wonder what?" Sara asked.

"Oh, I don't know, lots of things. Like what they were looking for and whether the task they gave us was a test or just an indication of the kind of mixed messages I will get if I get the offer and go to work for them," Chris said reflectively.

"Good question," Sara said. "I guess it could be either. So what did you do?"

"Well, I decided to just be myself. I put aside my concerns and just focused on the problem and working with my teammates. In fact, we worked well together. I really liked all four candidates. At least this company has a good eye for talent," Chris admitted.

"So what happens now?" Sara asked.

"They said they would make a decision in thirty days. I guess I will just have to wait until then and focus on the challenges in my current job. There is not much else I can do ... but wait," Chris said with a shrug.


(Continues...)

Excerpted from Get Paid What You're Worth by Robin L. Pinkley, Gregory B. Northcraft. Copyright © 2000 Robin L. Pinkley and Gregory B. Northcraft. Excerpted by permission of St. Martin's Press.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents

Contents

Title Page,
Copyright Notice,
Dedication,
Acknowledgments,
Preface,
1. If You Want It, You'd Better Negotiate for It,
2. Before You Receive an Offer: Building a Foundation for Success,
3. Getting the Offer: First Steps,
4. Survival Skill 1: Expanding the Pie,
5. Survival Skill 2: Claiming Value,
6. Responding to Offers,
7. Speed Bumps and Other Deal Killers,
8. Closing the Deal,
9. Tales from the Hiring Line: Lessons Learned from Job Applicants and Employers,
10. Final Thoughts,
Endnotes,
Index,
About the Authors,
Copyright,

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