In the intricate dance of hiring, salary negotiation is often the most fraught with trepidation. Yet, understanding its subtle complexities can transform it from a dreaded encounter into an opportunity for mutual gain. Here are five golden rules to remember before you make that next offer.
Know Your Numbers and Remember Salary is an Investment, Not an Expense
A well-compensated employee is an engaged, motivated, and loyal one. Approach salary negotiations with the perspective that this is your chance to secure the best talent to drive your company forward. It's a pivotal part of your growth strategy. What will your budget allow? And what is the current market value of the candidate’s qualifications? Use a credible Salary Guide to get the most up-to-date salary ranges. Start there. If your budget and market pricing are in the same ballpark, proceed.
In other words, there is no lowballing. It will only create an indelible, negative impression of you with the candidate and, eventually, among others, in the talent pool.
Be Fully Prepared to Negotiate
Preparation is your most potent tool in salary negotiations. This means doing your homework on industry standards, understanding the candidate’s worth, and recognizing the value they can bring to your company. But it also means being ready to hear something other than "Yes! when do I start?" Candidate pushback on salary shouldn’t offend you or catch you off guard. It’s part of a dialogue that can help you better understand the candidate’s needs and negotiating style. If there is room left in your budget to get closer to their number, go there. If there’s not, respond with a thoughtfully prepared no that emphasizes all of the other ways you believe the job will be rewarding.
Be an Active, Engaged Listener
A crucial but often underappreciated skill during salary negotiations is active listening. Engage with the candidate and understand their expectations, motivations, and any reservations they might have. But don’t forget to leverage the insights of your executive recruiter. An experienced headhunter who’s active in the market and in touch with the talent pool went through an in-depth, personal vetting process with each candidate they presented to you. They likely have insights into the candidate’s motivations, goals, highest priorities, and how to deliver what they value most. Ask your recruiter for input if the candidate is waffling on your offer.
This approach does more than help you tailor an offer that better aligns with the candidate’s needs. It also signals that you and your company value open communication and respect, laying the ground for a positive working relationship. Be sure you understand what the candidate would need to say yes - and be happy about it. Once you know that, you have a better chance of figuring out whether you can get there.
Know When It’s Over
A deft hiring manager knows when to call it quits. Sometimes, the gap between your needs and the candidate's is too broad. Sometimes, they’re not. Listen for the signals that you’re close to a point of mutual satisfaction or have hit an impasse. If you’re not sure, ask the candidate. Pushing beyond the end of welcome negotiation can sour relationships and waste precious time. If an agreement can't be reached, part ways professionally, leaving the door open for future possibilities.
Remember, It’s an Art, Not a Zero-Sum Transaction
Ultimately, successful salary negotiations hinge on believing that both parties can emerge winners. It’s not about cutting corners or squeezing value out of the candidate but about mutual benefit. By fostering an environment of fairness and cooperation, you are more likely to secure a loyal and motivated employee. Remember that the end goal is to create a package that feels rewarding to the candidate while aligning with your company’s capabilities, goals, and prospects.
When handled with confidence, grace, and a solid grasp of the facts, they create an opportunity to affirm your company’s values and commitment to talent, with each discussion bringing unique insights and new opportunities for growth.
At SkyWater Search Partners, we understand each candidate's unique needs and priorities and are experts at tracking market values and salary trends. Please reach out if you want to know more about how we can help you find and hire the right talent for your team. We would love to talk!
