Negotiation, like a Krav Maga self-defence course, has become a survival skill for many. It is primarily concerned with striking a bargain, attaining power and a means by which people with different interests can agree on how to reconcile them. Good negotiating is about asking the right questions or doing the right things to achieve desired results.
The same applies to career negotiations. Your negotiation at your first job interview is your most important because it sets your salary package for the future. Put harshly, salary negotiations are based on ‘price the space in the organisation’ and then ‘price the person’. This is equally the case if you are negotiating for your business where you have to ensure that your overheads are covered with an equitable profit that makes the business transaction worthwhile. It is, of course, always worth remembering that companies make decisions on their cost planning – which is likely to include you – yet customers are in charge of their revenue in terms of building equitable profit.
Women can often not ask for what they really want and this can disadvantage them significantly in the progression of their careers or businesses. By learning how to talk themselves up (self-promotion) – a skill more common among men – women can maximise not only their current compensation, but also their future earning potential. Success to me is made up of ability, breaks and courage – the latter is necessary for good negotiating.
To conduct successful a negotiation meeting the following steps may be helpful:
- Prepare. Prepare. Prepare.
Information is everything. You will argue from a stronger position if you know how your salary or business compares with those doing similar jobs, both at your company and in your industry, or in the sector in which you deliver your goods or services. This involves establishing the facts getting quality information, preparing the case and for the negotiation meeting. Preparing can involve joining professional organisations, establishing relationships with recruiters and industry peers, searching the Internet for market data and intelligence on your discipline, etc.
Another crucial goal of your investigation is to learn how valued you are by your company and customers or clients. To quote Donald Trump: “If you owned the company, would you think you deserved an increase?”.
- Build up your alternatives
The ultimate power in negotiation comes from having a good alternative. The classic strategy is to ask for more money than you will settle for perhaps adding an extra 10 to 20% cushion or bargaining amount. Ask for much more and you risk seeming unrealistic.
The most obvious and potentially powerful fallback is an offer in hand for a better-paying position. This does not mean you should bring up a job offer in your first conversation about a raise since it will likely put your boss on the defensive. If you do not have another job lined up, the fallback could be to ask for something else important to you besides more money such as more annual leave, working at home a few days a month, an expense account, an Apple Mac, etc. as you want bargaining chips when it is time to talk. Once you determine which options are important, prioritise them – this is a skill of a good negotiator. Exaggerate the importance of issues you do not care about so that you get what you want the most. So, in practice, you might ask for a 10% raise but be willing to accept 7% if you also get extra holidays. Good negotiators get something in return for everything they give up, and this goes for business owners selling their goods or services also.
- Think about the other side’s perspective
Negotiating aims at solving problems. So your case will be much stronger if you focus on what your manager’s pressure points are and how you can demonstrate alleviating them, or say what you or your business can do to add value to their company.
Effective negotiators always think about the other side’s perspective. You need to understand your company’s financial situation, i.e., does your manager or client have budget constraints and how can you get what you want which is both reasonable and attainable to you both.
- Walk the talk
The preparatory work is done, now comes the talk. Pick a time to meet when you will not be interrupted, e.g., first thing in the morning or right after lunch. This is a serious conversation or tender meeting so have the discussion in the office and not over food or drinks.
There is no reason to feel nervous if you have done your research and homework. To reduce your anxiety before the meeting, focus on the merits of what you are asking for, not on the person you are asking. Be polite yet assertive – think if the meeting was recorded would you like to give you a raise or a contract!
- Be clear and listen attentively
Start the conversation by explaining why you deserve a raise or why you think your goods or services will benefit the prospective client. (This is where a written list of accomplishments or client testimonials is valuable.) Keep the meeting to the point and timely.
The best negotiators are not the people who make the most vehement argument; they are the ones who pick up on what is really being said. As much as 90% of the communication between two people speaking face-to-face is non-verbal so pay attention to body language -your manager’s or potential client’s, and your own.
Be prepared to hear no but do not give in, re-negotiate your bargaining chips and always remain calm.
Once a negotiation is reached get it in writing soonest to include building for the future in terms of measurements on job expectations or your business’ deliverables.
Negotiation should aim at a win-win situation for both parties. This will only be achieved if there is clarity of focus, preparation, proactivity and consideration for all parties. Commitment, action and positive thoughts will take you a long way.
© CA Compliance Limited 2019