Negotiating can be an intimidating feat, especially if you are approaching your boss for that raise or promotion for which you have been working so hard. However, without realizing it, we negotiate every day, multiple times a day, whether it’s with our parents, spouses or even co-workers. Most likely, you are better at negotiating than you think.
Regardless of our experiences with negotiation, it’s quite different approaching this conversation when your relationship with your boss and the opportunity to increase your earnings are at stake. Therefore, it’s important to have a solid strategy to ensure you approach the topic with confidence and skill.
Here are 5 critical steps in approaching your next salary negotiation so that you ensure your success in 2015.
Know What Issues are Most important to You
Before engaging in a negotiation, make a list of all the issues that are up for discussion, such as salary, title, vacation days or health benefits. To ensure you’re clear on what you want to fight for the most, list all the issues in the order of most importance. This will also serve as a guide in making concessions. Depending on the other party’s needs, if you need to make concessions (and you likely will), you can start by first conceding on the issues which are least important to you.
Know Your Ultimate Goal and Your Bottom Line
After being clear on what you’d like to accomplish, set parameters for yourself. First, if you are negotiating a raise, what is your target salary? Be honest with yourself about the number you’d like to achieve. It’s beneficial to be optimistic and set high goals for yourself, as long as you have rationale and are backing up that number with specific reasons. To achieve as close to your goal as possible, ask for a number that is higher than your target, especially if you are making the first ask.
In addition to setting high goals, it’s important to know your bottom line. Be honest with yourself about the lowest number you are willing to accept. You may have a dream company for which you want to work, but if you accept an offer lower than your bottom line, there will be implications on your satisfaction at the company down the road. Never share your bottom line with the other party. Showing all your cards can hurt your chances of achieving a number close to your goal.
Improve Your Options
When you’re negotiating a job offer, the more options you have, the better off you will be. This is where your BATNA, Best Alternative to a Negotiated Agreement, plays a role. Your BATNA is your plan B. It’s important to know your options and have a strong plan B as that can put you in a position of power. For example, if you are negotiating a salary for a new opportunity, you’ll likely be more successful in your salary ask if you have more than one job offer lined up.
In addition to having a BATNA, you must also gauge the strength and effectiveness of your options. For example, if you have two job offers, and you are equally thrilled about both, your plan B is a great one; therefore, the chances of you coming out on top are in your favor. On the other hand, if you’re not thrilled about one of the options, you must think carefully about your concessions as you’re structuring your negotiation ask. You may need to either be more conservative in your ask or highlight other leverage points, such as skills and experience, to reach your salary goal.
Specifically Outline Your Value and How That Impacts The Other Party
You’re now prepared with what you’d like to negotiate, the parameters around each issue, and you have some options lined up. Time to launch into your negotiation. Start the conversation by being specific with your ask and outlining exactly what it is you’d like to accomplish. That can include the exact salary increase, a new title, or number of vacation days.
After you make your ask, highlight all the different ways your skills and experience are valuable to your boss. Be sure to call out exactly how those skills will positively impact your boss’ situation. For example, if you are a sales manager asking for a larger base salary, you should point out that 1) not only did you exceed your sales goals this past year, but 2) your ability to cultivate strong relationships will enable you to bring in new long-term partnerships at the company. This will increase your team’s contribution to overall revenue and improve opportunities for the upcoming year. Being as specific as possible with what you bring to the table is critical in connecting the dots for how you will continue to be valuable in the future.
Put Yourself in the Shoes of the Other Person
Throughout the conversation, always think about the other party and his/her needs. At the end of the day, negotiation is really all about communication. Understanding the other person, and what’s important to him/her will take you a long way; therefore, ask questions to better understand the other party’s agenda and his/her long term goals. This will allow you to address his/her issues directly, resulting in a more successful negotiation outcome, as well as a stronger relationship.
In Conclusion: To Negotiate Your Salary
Approach your next negotiation with skill and confidence by setting goals, preparing and practicing. Not all negotiations may work in your favor, but creating a habit of asking can increase your earnings significantly.
Have a negotiation coming up? Make sure to download this free negotiation guide to prepare for your ask.