Salary negotiations are an inevitable piece of any job interview. There are possibilities and the hard truth in an “truly open negotiation” is this – its a give and take without getting into a stand-off situation. Multiple factors will influence this little game, namely:

Employer side

• How urgently does the position need to be filled?
• How critical is this position to the organization – are they seeking a worker bee or a queen bee?
• Where in the organizational hierarchy does this position fit (how high / low)?
• What fit is there between the candidate and the position’s requirements?
• What is the allocated budget for the position in question?

Candidate side

• How desperate is the candidate?
• What fit is there between the candidate and the position’s requirements?
• Is this position going to add resume-value?
• Is the organization going to add resume-value?

The above mentioned lists are not exhaustive by any means, and need not apply to all organizations or candidates in question. But the universal truth is – an organization’s goal is to make a profit (excluding non-profits and similar) and to that extent all employees are “costs”. Hiring managers and all departments operate within an allocated budget, and they will try to minimize costs at their end, to be seen efficient by their respective managers & bosses. They are NOT in the “fair pay” game!

In the following article by Marci Alboher, the following are the approaches that you can keep in mind when salary negotiations start. I have added my comments inline. Click here for the source article.

You’ve gotten pretty far in a job discussion. You like them. They like you. And it’s getting down to the nitty gritty. Then your prospective employer pops the question you’ve been dreading: “So what are you making now?” (or some variation like, “What were you making in your last position?”) You freeze. You know that answering the question can only hurt you. It might peg you at a salary you feel you’ve outgrown or that you improperly negotiated. And you know that you’re always supposed to let the other person name a price first in any negotiation.

So what do you do?

Avoid revealing your salary. Never reveal your prior salary, says Ramit Sethi, creator of the blog, IWillTeachYouToBeRich, and author of the recently published book of the same title. He is clear and unequivocal. “It’s just none of their business,” he told me. “You’re focusing on a new job and if you reveal what you made previously, two things happen. First, you’ve laid out all your cards. Second, you’re admitting that you are inexperienced in interviewing and negotiating.” (That last bit was particularly painful for me to hear since I’ve made the mistake of revealing a prior salary and I’m in the business of advising people about how to manage their careers.)

[Ed: You can state you have a non-disclosure agreement (NDA) with your past/current employer and hence you are unable to reveal your salary numbers. This helps in 2 ways - its avoids portraying you as desperate and inexperienced candidate while additionally highlights to the interviewer that you honor your existing & prior commitments.]

Focus on your value. If the employer persists, Sethi suggests steering the conversation to the value you’ll be bringing to the position. If you can focus, say, on the hundreds of thousands of dollars in revenue you’ll help the company generate, it becomes harder for them to focus on the thousands or even tens of thousands of dollars you might be haggling over. If your position doesn’t have a clear connection to the bottom line, Sethi says to emphasize how your job will allow your manager to do his or her job more effectively. In the end, it’s all about how you’re going to help the organization achieve its goals.

[Ed: You may want to leverage some of the questions highlighted in my prior blog post. If you have not been offered the chance to ask questions, you can use this as an opportunity to pose a few questions by your initiative - mentioning this should not irk the interviewer, as they know that they have taken the interview from an "assessment of the candidate" to "assessment of the cost" phase - that's why these questions typically come towards the latter end]

Discuss salary ranges. If you get the prior salary question, steer the negotation to why you should be at a certain number or range, says Carol Frohlinger, managing director of Negotiating Women and author of the book, “Her Place at the Table.”

One instance where it’s fine to reveal your salary is when you feel like your current salary is in a reasonable range and you are only seeking a slight bump–say around 10 percent–according to Susan Cain, president of The Negotiation Company. “If you’re not there, which is often the case, then you’ll want to deflect at least until they love you and don’t want to lose you,” says Cain. “At that point, you can say that you don’t think your current employer would be comfortable with your disclosing what you earn.” If you ultimately feel you have to disclose, Cain says you should just explain, in a non-defensive way, why you think it’s low and why you should be in a higher range. She recommends saying something like: “I’ve had various training and experience and am now looking for a position that will reflect my acquired expertise.”

[Ed: There is no hard and fast on how to handle the interviewer - the onus of this is on the candidate with the interview ongoing. I have some compiled approaches to this in another blog post. I disagree with Susan Cain and would still try to keep the "estimation" with the interviewer and recommend not revealing the current numbers. If you must reveal a number, present a ballpark number that you are expecting. More in the following points.]

Know your worth. When you do sit down to talk numbers, make sure that you do your homework so that you know what the range should be for the position. “It’s not just what the job pays, but what does it pay in your geographic area, in a company of the size of the one you’re looking at, in the same industry,” says Frohlinger. “And also think about what there is other than salary, what other things people have gotten for a total compensation package.”

Do your homework. In order to build a picture of what a job is worth, canvas your entire network, looking especially for people who have left a company you’re talking to. In addition, check out sites that offer comparative salary details, like Vault, PayScale, Salary and Glassdoor. If you work as an independent contractor or freelancer, ask your peers what they charge. “Talk to at least five people,” says Sethi, “since not everyone charges properly for their work and you might get a range of anywhere from $30-$200 an hour.”

[Ed: "Know you worth" & "Do your homework" are KEY POINTS to salary negotiations and I simply cannot state this enough. If you feel compelled or must reveal a number (based on the actual situation during the interview), I would recommend that you present a BALLPARK number that you are EXPECTING. State this upfront. Multiple factors affect this computation - the extent of your research, the company's standing as a paymaster, the actual position in question, etc. To this extent, Glassdoor and Wetfeet are excellent research resources.]

What if you reveal too much? So what if you’ve messed up and revealed more than you wanted to? The best way to recover, says Sethi, is to start collecting evidence of your success on the job and immediately plan for an opportunity to sit down with your manager about how you’re doing. You’ll have to let some time pass–Sethi suggests about six months–but it’s important to let your manager know far in advance that you are preparing for a conversation that will include revisiting your compensation as part of it. In fact, Sethi says that by the time you have that conversation, your manager should fully know that you’re seeking a raise since you will have been laying the groundwork and showing off your accomplishments along the way.

[Ed: I have been in a position where I wanted to land a job and revealed expectations due to eagerness to get the job, the resume value of the position in question and the ability to work in a certain geography. Towards this I have no regrets, but I did not realize even before the ink dried on the employment contract, I had unknowingly created certain impressions with the team of people who I interviewed with all the way up to senior management! So beware of seemingly harmless considerations which may precede you well before your first day in office!]

[Ed: To summarize, I believe - based on my experiences - that its better to come across as a good negotiator who stands by professional ethics, knows his/her worth, will only make fair compromises and all this without offending any of the hiring team members. Job hunting is not the same any more.]

[Ed: I know this is a open topic and I invite comments and feedback from readers of my blog - lets make this a joint learning exercise]