How aggressively should you negotiate the terms of a job offer, especially in a tight job market like this one? It’s a question that leading business schools in the UK and Europe are attempting to answer for their MBA students, in the wake of complaints from on-campus recruiters.
Apparently, some of the candidates who received job offers pushed too hard for fat salaries, ignoring other areas of compensation for which companies often have more flexibility.
Now the schools are expanding their classes on negotiating skills, to help candidates get better deals without annoying prospective employers, according to an article in the Financial Times.
Shifting the focus from basic salary can help both sides. First, because employers don’t like to set precedents when it come to base salary. Second, because other perks, from transportation to wardrobe allowances, relocation and housing expenses, and even private school allowances for kids, can often be more personal and meaningful (and easier to grant).
Of course, the biggest mistake you can make is not negotiating at all. When times are hard, candidates tend to give in more quickly, according to Daniel Porot, who teaches salary negotiations at IMD in Lausanne, Switzerland, and the London Business School. But this sends the wrong message. You should instead be emphasizing your unique abilities and the specific value you bring to the firm. Some other tips from the article include:
Seize the day: you’ll never have as much negotiating power as the moment you receive your investment banking job offer. Employers expect you to negotiate, and will not balk if you ask for a couple of days to think about things.
Do your research. Make sure you know what type of compensation other professionals in your niche and with your experience are earning.
Do not attempt to bluff an employer by claiming you have a competing offer, if you don’t. However, if you have a high-paying offer for a job you don’t want as much, you can make a strong case for matching that amount.
Practice your negotiating with a friend. Ask a friend or colleague to role-play as to how the discussion might go.
Don’t obsess over salary. As mentioned above, it’s often easier for an employer to be flexible on the perks rather than base salary.
Finally, think about negotiating to negotiate later. If you can’t get everything you want, one option is to agree to a compensation review at the six-month mark, after you’ve demonstrated your value to your new employer.