Is That Your Best Offer? | How to Negotiate a Higher Salary and More Perks
2. Your bargaining power reflects the company's experiences with you
Bargaining power is the sum of all the impressions you've made.
A referral from a respected source is a great first deposit in your power bank. More than one adds to your account. Enthusiastic references contribute still more. An impressive first interview, in which you articulate your strengths, show that you know what it takes to do the job, and share some insights based on your own research, can be a big power boost.
If your follow-up to that first meeting demonstrates more work on your part, you get a second interview and more power. When your meetings with your potential colleagues go well, you raise your stock a bit more. Perhaps you can tackle a short-term assignment (for pay, if there is substantial work involved), and show off your talents. Now they really want you!
By the time you are in what's generally recognized as the negotiation process, you're dealing from a position of maximum strength.
3. The earlier you enter the hiring process, the more influence you can exert
A company rarely decides to seek out a new employee on the spur of the moment. Unless it's simply a matter of replacing an employee who's moved on, such decisions typically follow a three-stage process:
Stage One: A problem or need is identified. There's too much work to be done by the existing staff, a problem with quality or customer satisfaction, or a need to develop new business.
Stage Two: Solutions are considered. Should several employees' jobs be redefined so that their talents are put to better use? Should an existing staff member be moved to a new position? (If so, that person's old position will have to be filled.) Should a new employee be hired to fill the position? Or should most of the work be outsourced?
Stage Three: The job is defined. The company decides to create a new position. The next questions are: Where will the money come from? Who will the person report to? What will the job description include?
Only after all three stages are completed does the company go to the market—advertise the position, post it on the Internet, hire a recruiter to find the right person. If you enter the game at this stage, you're likely to face a fair amount of competition, which means diminished bargaining power.
Getting considered early usually means entering the discussions informally. If your first contact with the company is through an informational meeting (perhaps set up through one of your networking sources), you can talk about your background and interests without the pressure of an interview situation, get feedback on any research you've done, and learn about the industry and the business from an insider.
In the process, you may see a need or problem at the company that has not yet been defined (entering at stage one), or find out about one whose solution has not yet been settled (entering at stage two).
You'll be able to follow up on the information meeting with a letter or e-mail describing the additional thinking or research you've done (based on the insider perspective you've gained), which sets you up for another meeting. Once you're in the discussion loop and have established your credibility, you're in a prime position to land a position that's tailored for you.
4. Taking on a short-term project can dramatically improve your bargaining power
While you're holding informal discussions about the company's needs, you're in an excellent position to suggest that you take on a short-term project addressing a critical issue. (This is also a great way to make yourself stand out if you've entered the hiring process after stage three.) Possible projects include:
- Conducting a customer survey
- Organizing and running a focus group
- Evaluating and making suggestions on a proposed employee-benefit program
- Exploring and reporting on better sources for contract manufacturing
- Flow-charting operating procedures and suggesting a more streamlined processes
- Scoping out a potential new business alliances
- Finding new business prospects
Properly structured, such a project gives you several potential advantages:
You can demonstrate the quality of work, rather than relying solely on your résumé and the inferences people make when interviewing you. Of course, it's essential that the demonstration show you in your best light—that you meet the deadline, produce more than you promise, and provide facts and insights that are clearly worth having.
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