Yesterday we listed the dos and don’ts when it comes to asking for a pay rise at work. Today we share advice on how to negotiate for the salary you want and deserve.
When it comes to getting the salary you want, you need to have good negotiation skills. But how much should you ask for to ensure you get what you want?
Well according to a recent study by Columbia Business School, to be published in the Journal of Experimental Social Psychology, making a precise first offer during a negotiation makes you appear better informed and leads the other party to concede greater value to you.
The research, titled Precise Offers are Potent Anchors: Conciliatory Counteroffers and Attributions of Knowledge in Negotiations, reveals people’s tendency to use round numbers when making opening offers and says they’d be better off using precisely expressed figures. The precision with which a negotiator expresses an opening offer signals his or her confidence in its appropriateness.
Therefore, according to the research, an employee who makes a precise first offer when it comes to negotiating a pay increase will appear more credible and better informed of their own value, prompting a more conciliatory response from their manager/employer.
“Being precise signals that you have researched the subject and put thought into your offer before expressing it. It’s not just about the numbers, it’s about what your price proposal implies about the state of your knowledge,” explain the authors of the report, professors Malia Mason and Daniel Ames. “It’s therefore important for precise offer-makers to be prepared to offer a rationale for the price they suggest.”
Across a series of studies, Mason and Ames found that those who made precise offers received greater concessions and secured better financial settlements than those who made round offers.
However, while it pays to be precise, Mason and Ames warn of the potential risks of being too precise, noting that overly precise first offers could signal inflexibility and prompt other parties to walk away.
But whether you throw out a round figure or offer a precise amount during salary negotiations, you also need to make sure your request is within an appropriate range.
To ensure you’re not asking too much the director of Nourish Coaching, Sally-Anne Blanshard, says to look at market rates.
“Look at Seek and other jobs boards to get a feel for what your role is being advertised at. Recruiters become really good trusted advisers here. They can actually say to you your rate is ‘this’ or you’re underpaid,” she says.
“Use your network, information that’s readily available and utilise those trusted advisers like mentors or recruiters.”
Having done all your research, it’s also good to keep in mind the current state of the market and whether your employer is offering pay rises at all this year.
“If somebody is doing the same job, their responsibilities haven’t changed and it’s just a case of another year on, then normally [a pay rise] would run in line with the consumer price index,” says Hays director Jane McNeill.
“Quite often organisations in tight markets will say they’re not awarding any pay rises this year. If they come out and say that then there’s probably little point in having a discussion, unless your duties and responsibilities have changed.”