Principal Consultant, Career OverDrive!
I recently passed the interview stage for a Systems Engineer position, and they sent me an initial offer.
I found the proposed salary to be insufficient given my years of experience and level of education (M.Sc.), however; and I countered by asking for a substantial amount above what they offered.
In order to justify the increase, I mentioned how much my participation (in a technical capacity) may have contributed to revenues for past employers. Unfortunately, that was a mistake; but I was just expecting fairly straightforward negotiating.
Instead, they responded by telling me to come up with a business plan to make the same amount of money for their company.
However, I have no experience, nor interest, in the business end of things.
I'm obviously in a weakened bargaining position at this point, and I'm wondering how best to proceed without making it worse. Or better yet, turn the tables back in my favor.
Ask The Career Coach's Reply
First off, congratulations on successfully completing your interviews and receiving a written offer!
That's no small feat in today's continuing "uneven" economy.
With that said, you're now facing a common situation whereby you believe that what the hiring company is offering you in terms of compensation is below your market value or at least your expected salary.
Further, you're now seem to be feeling that you may have boxed yourself in and developed a weakened bargaining position. Perhaps there's also a tinge of a feeling that you may have pushed too hard, potentially straining your future working relationships should you accept the offer (or that it may even serve as an impetus for the company to even rescind the offer).
So let's get this straightened out.
First, let's back up and consider how offers are determined or calculated, what factors influence them and what can be done to generate the highest initial offer with the highest velocity of transaction or transactional velocity.
Salary negotiations begin the moment you contact the company.
From the very first contact made by you (or your recruiter on your behalf if you are using one) or if it's inbound then it's contact made by them, you are imputing and signaling value -- whether you intend to or not.
Your task then is to position, package, promote, present, persuade, communicate and convey your value to the prospective employer.
Initially, through you resume, an online application, an online profile, an outbound phone call, outbound email or some combination thereof, you should be working to be seen as the "Must Meet Candidate". They must feel that they have to meet you.
Sure, they may meet you anyways, even if they are not hot for you, but the idea is to get them hot for you by raising their buying temperature.
Next during the interview process, the purpose is to be seen as the "Must Hire Candidate". That is, they must feel that they need to hire you ASAP and bring you on board as both as a fully satisfied and as a fully engaged contributor. That will normally yield the strongest package and fastest delivered written offer.
That's the ideal scenario.
Now, more specifically to your case.
You feel that offer is too low. This raises several questions:
1. Why do you feel it is too low?
2. Upon what are you basing your argument?
3. How far apart is what you expect and what they have initially offered you?
There are many factors involved, and these may be reasonable (at least from the company's standpoint of cost minimization + production maximization) as to why they are offering you "less" than you think you are worth (or that the market is saying that you are worth).
Here a few of the more common factors involved:
- The market has changed.
- Your skills have aged.
- They feel that you are a risky hire (job hopper, career damage, accumulated disadvantages, etc.)
- They feel there is an abundance of qualified candidates.
- They feel that your skills are fungible, that is, a commodity, like flour, table salt, canned corn.
- They do it because they can -- you're unemployed and have no other options. Therefore, your current salary is zip, zero, nada, zilch.
- They have a hard budget number to meet.
- many more.....
So rather than speculating this, let's look a little closer at their response to your push back. After pushing back (which can often be a very good thing as it also imputes and signals value), they asked you to justify your counter offer.
Notice that they didn't say "no", "nein", "nyet"....
Nor did they say. "That's it, take it or leave it. This is our best offer"
They asked you to justify it.
This means they are open to your counteroffer but you need to prove it.
Further it is a good sign in that by forcing you to justify it, they can still offer you the same initial amount if you can't justify it and not feel bad or look bad since even you were unable to justify the increased salary amount you had desired or requested.
Okay, so how specifically can you justify more money?
First, here's what not to do:
- Don't push hard.
- Don't give ultimatums.
- Don't get whiny.
- Don't try to value or give value to what they don't value. That is, you are thinking that a Masters degree has some intrinsic value, but if they don't value that, they don't want to pay for it. Don't try to sell them a Mercedes if they only need a use pickup truck. That is a major mismatch or misalignment of talent and need.
- Don't try to use "salary surveys" to justify it.
Alright, then what to do?
Glad you asked. :)
Look at the value that you will bring and then quantify that financial impact the best that you can.
I would start out like this:
"Look, I'm really interested in this position, I'm impressed with the company, I feel it's a really good fit for me and I know I can add value. I'm not here to roll you over, break any budgets or squeeze anything above my market value, but given what you are looking for and what I can provide, I'd like to be compensated for that."
"I'm not a financial whiz, I'm a system engineer and I think my track record shows I'm good at it, so I'll try to more clearly articulate the value I feel that I will bring you. Thank you for considering this."
The next part is where you need to take the difference of what they offered you and what you countered with and justify it.
You have two ways to justify it:
1. Revenues produced/ROI generated.
2. Costs reduced (minimized mistakes, increased productivity, higher quality, etc.).
Avoid Feature Focus and Spotlight Benefits Brought
Rather than stating that you have XXX years of experience as a Systems Engineer or that you have earned a Masters degree (primarily features but can serve as benefits), you are far better served to map out and align the actual benefits that these skills will bring to the company's needs (and their bottom line) and this position so that you can show the value and benefits you bring to increase revenues, increase productivity while reducing costs, decreasing risks and so on.
Case in point:
Look at Heartbleed. Maybe your value is that you are good at testing both negative testing and regression testing and your enjoy trying to break your/others modules and so on.
How much money would such a skill and talent like that save or have saved?
1. XXX years of experience may mean that you can work more efficiently.
2. A Master in Computer Science may mean that you develop better product environments, write better software, etc.
Think along these lines.
And make it visual. Why not make a 2 or 3 slide document that shows just the difference of what you want.
Maybe it's a $10,000 USD difference.
Show that as $10,000 USD and then show what you'll produce and put a dollar figure on it. Ideally, show the incremental improvements of your skills as well, and hopefully you are producing an even greater amount of value above the total salary you would get when it matches your desired salary.
Hope that helps!
- James Santagata