How to negotiate your next job offer

Avoid the common pitfalls and secure the package you really want

By Niro Sivanathan 26 March 2019

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After the interview, securing the job you want at a salary you deserve can be a delicate process. One negotiation could translate your qualifications and experience into a dream package if you avoid the common pitfalls.

One mistake is to solely focus on salary, says Niro Sivanathan, London Business School Associate Professor of Organisational Behaviour and co-academic director on the Decision Making Strategies for Leaders open programme. Reducing, arguably one of your most important negotiations to a single number is not an effective way of securing the role or an accurate reflection of what you stand for. Critically, this approach can also damage a relationship right at the start.

“It is short-sighted to focus simply on salary,” he says. “Haggling over a price like this can quickly diminish an integrative negotiation to a contentious one. The counterparty does not know why you are asking for a given salary level – is it just ego or could it be childcare costs to make the job work?”

The second pitfall is to negotiate issues sequentially. “Once you’ve agreed a salary you might then move onto other aspects of the role, like holiday and location, which can further build resentment, especially if the other party feels they have overstretched to make the salary work,” Dr Sivanathan says.

Dr Sivanathan recommends Multiple Equivalent Simultaneous Offers (MESOs) that neatly deal with a range of negotiation pitfalls.

“You need to package elements of your negotiation position into choices that take into account all factors that make up your offer,” he says. “This puts the conversation on a collaborative path, while ensuring you achieve outcomes on issues that matter to you.”

MESOs are powerful ways to methodically express what is really important to you without looking too assertive, says Dr Sivanathan. Making a MESO involves creating a scoring system that allows you to compare qualitatively different issues. These may include location, holiday allowance, medical coverage, executive training, childcare and flexible working.

 Points of Negotiation
 Weight
 Points Score Package 1
 Package 2
Package 3
 Salary            
 £70k  0.3  60 18  
   
 £90k  0.3  80 24
 24
 
 £110k  0.3  100 30
  30
30
Location            
 London  0.3  100 30
 30    
 Paris  0.3  90 27
    27
 New York
 0.3  80 24
   24  
Group to join            
 Strategy  0.4  100 40
 40 40
 
 HR  0.4 90 36
    36
 Finance  0.4 70 28      
Package Value        94 94
93

 

You must next weigh each factor against the other and give them a score. Once you have ordered your priorities around your overall happiness, you then build a series of different job packages, each with an equivalent total value. You could aim to offer three packages to avoid overloading the negotiation (see table). This provides the other side options and flexibility to help meet your expectations, while ensuring you steer the conversation around what really matters to you. You are signalling cooperation and your potential commitment to the organisation by considering long-term issues in the prospective role.

“The counterparty does not know why you are asking for a given salary level – is it just ego or it could be childcare costs to make the job work?”

We all instinctively have a gut reaction to offers – they either feel good or wrong. Equivalent package offers and scoring systems allow you to analyse this in a more systematic manner.

Frame the options as a choice and explain to the other party that there are numerous ways to construct your deal. If the first set of offers are not successful right away, ask the other side to indicate which is closest and why, before updating your packages accordingly. Doing this can result in a deal which incorporates both sides’ priorities. This flexible approach allows you to be persistent and assertive without appearing stubborn.

By negotiating in packages, it also signals that you are not accepting or rejecting offers based on a single issue – salary – often the stickiest issue for an employer to negotiate. “This is a more collaborate approach that increases your odds of maximising value in your negotiation,” says Dr Sivanathan.

Once you are in post, providing equivalent packaged offers have a myriad of benefits. Selling products to negotiating deals with suppliers are the obvious ones. For example, bundle your product’s features and move the negotiation from the bottom line price to the services you can offer alongside the main product.

As you receive those job offers, avoid distilling a rich opportunity to a single issue or sequential negotiation. Instead, focus on conversing in packages and, when possible, offer multiple equivalent packages to help kick-start a more collaborative job negotiation.

Comments 2

Prof.Salam Al Shereida 4 months and 16 days ago

It takes a short while to express and enhance your voice, but once you have it you damn sure are going to use it.

Srikanth Prabhu 5 months and 4 days ago

I have a question Prof. Is it all about the ego issue while you negotiate for salaries, for someone who is not married and does not have kids?