Salary Negotiations

former trader – that’s a good question. now that you’ve refreshed my memory, that’s what HR said to me – they basically explained that all their associates were given a certain base and projected bonus as a percentage of base, and that they had to keep everything within that scale. i think i said something to the effect of, “okay, that’s interesting. well, i guess i can see where you’re coming from – if you’re not able to make any changes to base or expected discretionary bonus, i would also be fine if you made me whole through a sign-on bonus of $XX. i think this number is fair because it captures the difference between what i am hoping to make on salary and bonus for this year and the next. if this works for you, i’d be confident in my decision to sign with you today.” (i always like to set time frames for my decision because it gives them a greater sense of urgency to close the deal) topher – $XX (the amount i made two years ago) was less than $YY (the amount i made last year), which was only slightly less than $ZZ (the amount i received as an initial offer). $WW was the most which is what i asked for and the final offer ended up being pretty close to that. to be honest with you, i think the BEST leverage you can have is to have another offer in your pocket, so you know what you’re worth and you’re mentally confident to take the other opportunity if the firm doesn’t raise you. the second best leverage is to know what other comparable firms are paying, and i was able to get this information by speaking with my colleagues as well as headhunters. having another offer in your pocket is as good as gold, but knowing what the rest of the market is willing to pay for your services is just as good. you don’t even have to have another offer in hand; just implying awareness of the hiring environment is good enough and will force any savvy employer to respect you and to take you seriously. you should NOT negotiate salary unless you know how it stacks up compared to market. i know some people play the “increment game” and like the whole back-and-forth of negotiating, but my personal approach is to not engage in a protracted dialogue and just tell them exactly what i want. my conviction is reflected in my tone of voice, and in the occasional situation where someone offers to “meet me halfway,” i’ll explain to them that while i appreciate their gesture, i’ve really thought long and hard about what’s fair and what the market’s paying, and what i think is fair is exactly what i told them. basically, when i engage in any type of salary negotiation, i make sure i already know what i want and that i also have a number in mind at which i’m willing to walk away. if you’re cordial and respectful, the firm will most likely not retract the offer just because you asked to negotiate – i know some people say they’ve run into it, and i guess this is a chance that you have to be willing to take any time you counter someone’s offer. but that’s why it’s so important for you to be confident in what you’re worth, and be willing to walk away with nothing if the person giving you the offer decides to pull back. if HR detects any doubt in your voice, you’re much less likely to get what you want. anyway, those are my personal salary negotiation strategies. they have worked for me, but i would be curious to hear more about what else has worked for others as well as how successful or unsuccessful your approach was. please share any stories or strategies you guys may have.

Good info here, thx for input. The career management advisor at my uni recommends NEVER to say a number when asked what compendation you’re looking for because obviously you always want the other party to talk first. He says, when asked, first you should say ‘‘what the market is paying’’. This I agree with him on this point and and always follow this. If the other side aks ‘‘what is market for you?’’ He recommends sayings someting like: ‘’ You are in a better position of determinig what your firm pays for such a position and I would consider an offer from your firm’’ This is the part I really have a hard time with because when I am pushed like that I usually give a range of what I think is my market worth because I dont want to offend them by not answering their question. 1- What do you guys think of his recomendations 2- Also when they ask where else you are interviewing, do ou guys name the actual firms? btw he recommends basically the same silent strategy for the ‘‘what’you making at your current positon’’ question.

Sims, I’m sure you realized this but just in case there was any confusion, the original poster was asking what to do for counter-offers which assumes a direct exchange or an implicit understanding on the firm’s part of what you’re already making. But anyway… 1.) If the firm asks you for a number before they’ve given you an offer, you should just say that you’re expecting something that’s in-line with the market. None of the places that I’ve interviewed with has ever asked me to specify a number before an offer was tendered, but if they did, I would make sure to have a number in mind. Sounds like you just have to get more comfortable with letting people know what you want and what you think. I also have no reservation about telling employers what I’m making at my current position. Usually salaries on the pre-MBA level are within a fairly tight range across Wall Street anyway, and if I feel like I’m making near the top of that range, I always make sure to say it. I expect employers to give me an offer that’s measurably beyond what I’m already making if they are hoping to hire me. 2.) I never tell people all the firms I’m interviewing with – whenever I’ve been engaged in the job search process, I’m usually involved with several firms at once. However, I will namedrop a couple big ones just so they know that I’m serious. For example, if asked, I might be interviewing with several firms at once, but I might just say something like, “I’m actively speaking with several of the larger consulting firms with McKinsey being one of them, but it’s just because I’m firmly committed to making the move to consulting and given how competitive the hiring process is, I just want to make sure that my job search doesn’t leave any stone unturned.” This way, you come across as someone determined to make a move without actually indicating who your “top choice” is, while also being someone who is clearly sought-after. Whenever firms ask you who you’re interviewing with, it’s almost always because they want to validate that you’re the type of candidate that other firms want…and they figure that if other firms are talking to you, you must be doing something right.

numi Wrote: ------------------------------------------------------- > 2.) I never tell people all the firms I’m > interviewing with – whenever I’ve been engaged in > the job search process, I’m usually involved with > several firms at once. However, I will namedrop a > couple big ones just so they know that I’m > serious. For example, if asked, I might be > interviewing with several firms at once, but I > might just say something like, “I’m actively > speaking with several of the larger consulting > firms with McKinsey being one of them, but it’s > just because I’m firmly committed to making the > move to consulting and given how competitive the > hiring process is, I just want to make sure that > my job search doesn’t leave any stone unturned.” > This way, you come across as someone determined to > make a move without actually indicating who your > “top choice” is, while also being someone who is > clearly sought-after. Whenever firms ask you who > you’re interviewing with, it’s almost always > because they want to validate that you’re the type > of candidate that other firms want…and they > figure that if other firms are talking to you, you > must be doing something right. numi, would you ever lie about the other firms you are interviewing with? For example, if you are only interviewing with one firm, would you still name drop? As for when they ask for salary in the initial interview, i always start my answer with “what the market pays” but HR always pushes me to give a specific number or range. I guess they do that because they have a budget and don’t want to waste your time or theirs if your expectations are outside their range.

I’ve changed jobs a few times in my career and always got a decent jump in total comp each time. My rule of thumb when asked what compensation I want is to give an approximate high-ball range of what I expect to make next year and then say that I “hope to make an amount above the high end of that range.” So for example if I had made $100,000 all-in last year, I would tell the interviewer that I expect to make $175-200,000 next year (even if it isn’t true, there is no way they can verify that) and then say that I hope to make somewhere above $200,000 at my next job. That way you just created a 100%+ jump for yourself out of thin air. The key is to not get too crazy with the numbers. If I had said $275-300,000 instead, then it is more likely they would ask me to provide proof or just say that they’re not willing to go that high.

i agree with farley013. that’s a good strategy. at the same time, implementing the strategy properly requires you to have thorough knowledge of what the market’s willing to pay for your services, as well as what the typical range is for your position. for example, if your firm has a history of paying people in your role a year-end bonus of $20K-50K, it’s probably OK to say something about how you’ve gotten really good mid-year reviews and based on what you got last year (assuming your bonus number was also good), you’re expecting your bonus to be $60K. just don’t say something like $100K and expect not to be called out on it.

former trader Wrote: ------------------------------------------------------- > numi, would you ever lie about the other firms you > are interviewing with? For example, if you are > only interviewing with one firm, would you still > name drop? no, i wouldn’t lie about the other firms i’m interviewing with. i would still name drop though. you can get around this question by saying something about how you’re “in the process” with several firms with one of them being Blackstone, if (1) you have applied for multiple jobs, implying your engagement in multiple job search processes; and (2) you are really interviewing with Blackstone.

Numi you are great ! very insightful post(s). I am interviewing right now, and was very nervous about the whole how to negotiate thing. I feel more confident, and oriented now.

no problem thunderanalyst. happy to help. hopefully you’re able to reel in a great offer next time around.

Me: I want 25% raise. Them: sowwwwyyyyyyyy Me: buh-bye

I agree with thunderanalyst…numi you are awesome!!

I took an undergrad negotiations class in college, he told us he would help us at least pay for the class, if not for school. When it came time to buy my first “new” car, let me tell you, that class was the smartest one I ever took! Right on with asking for more than your “walkaway” price. Always have a walkaway price.

finspert – glad I was able to help. Let me know how the negotiations turn out for you, whenever you get around to them. Hopefully you have some good stories to share with us down the line. Anyone else have some good negotiation tactics as well as success stories? amberpower – I agree. Knowing your “walkaway price” is key. After all, you have to convince yourself about what you’re worth before you can possibly convince anyone else!

It’s because of posters like Numi that I will stick around this board even after I obtain my Charter.

“The career management advisor at my uni recommends NEVER to say a number…” That’s why he’s still just a career management advisor at your uni.

As an aside, I think it’s important to be straighforward and honest about your current compensation if they ask. Maybe it’s not a great negotiating tactic, but at least it’s ethical. I maintain that it is unethical to give a potential employer the runaround if they directly ask what your compensation was in the past year (current salary, last year’s bonus). When it comes to negotiate, I think it’s fine to quote numbers based on your research and aspirations.

This is good to know. I honestly want to make double what I am now. And I think it’s very possible with the right kind of position, but I was initially a little uneasy about requesting such a high raise if it ended up being the case that they knew I made less than 50k a year. Danteshek Wrote: ------------------------------------------------------- > As an aside, I think it’s important to be > straighforward and honest about your current > compensation if they ask. Maybe it’s not a great > negotiating tactic, but at least it’s ethical. I > maintain that it is unethical to give a potential > employer the runaround if they directly ask what > your compensation was in the past year (current > salary, last year’s bonus). When it comes to > negotiate, I think it’s fine to quote numbers > based on your research and aspirations.

During negotiations, do you tell if you have other offer and what salary are they offering? Or it’s better not to talk about the other offer? Thanks!