How to Negotiate Your Job Offer - Prof. Deepak Malhotra (Harvard Business School)

Deepak Malhotra is a professor in the negotiations organizations and marketing at the Harvard Business School negotiation in the MBA program and in a wide variety of executive programs including the owner president management program changing the game and families and business Deepak has won numerous awards for his teaching including the HBS faculty award by Harvard Business School's MBA class of 2011 and the Charles M Williams award from the Harvard Business School in both 2011 and 2012 the MBA students allegedly taught to give the best of EC years each to graduating students so without further ado professor ultra good afternoon how are we doing alright couple of quick points Before we jump into the topic I'm wearing a mic and the reason is the session apparently is going to be videotaped and I'm not sure yet whether it will actually show up anywhere but the few things that I do know is that the folks that are videotaping are under strict orders not to videotape any of you and the reason I mentioned that is because a lot of what we're going to do is going to be some Q&A and at that point whatever question you have you should feel comfortable asking and I will try to address literally any question you may have the only thing I'll ask on the questions is to the extent possible make it a generalizable question make it a question that may be relevant to people that are you know greater than one in this room and so whether you're even if your question comes from a specific area if you can put it in a way that's a little bit more useful to everybody that would be great I'm going to do this in a slightly different way than I've done in the past I've held a session like this occasionally on my own occasionally with a colleague of mine max bazerman for the last few years and we typically launch into Q&A or about five minutes into the session this time I decided to do it a little bit differently I'm going to start out with about 15 pieces of advice that are preset based on the kinds of questions I've heard often in sessions like this in one-on-one conversations with my students or other folks the kinds of things that you may run into and so as we go through those 15 my guess is that some of those are going to be obvious to you or intuitive to you some of those may not be relevant to you but my guess is also that there may be one or two things in that list of 15 that everyone looks at it's designer that's kind of interesting I hadn't quite thought about that or that's actually quite relevant to what I'm doing and the one thing that's most relevant to you may be different from the one thing that's most relevant to you but I'll go through all of these because in the past they've been relevant to at least some people in each room so we'll do that and then we'll go into QA the only other thing I'll say is a lot of the action that happens in the job market season isn't necessarily at the table it's not when you're sitting across the table from the person you're negotiating with it's a lot of the stuff that happens before or after and some of the points I'm going to touch on are going to are going to hit those but there may be additional questions that are relevant to you in that domain if you're standing uncomfortably feel free to just filter into the sides there's more service sitting area at least on the steps if you're comfortable standing that's great if not then please move around there's a couple seats in the middle here as well if somebody wants to sneak in all right so I'm going to go through a few things that I think may be relevant to you feel free to take whatever notes feel free to ask questions during if something is unclear I'll try to go through this relatively quick so 15 pieces of advice the first thing I'm going to tell you is here's the equation for getting what you want this is you know just cutting to the chase you want to get more you want more money a better offer a better deal here are the components of what you need to do first they need to like you alright so that's the first component so the things that you do that make them like you less make it less likely that you're going to get what you want alright that's not enough they have to believe that you deserve it it's not enough that you believe you deserve it it has to be believable justifiable to them another version of this is don't ever ask for something without giving the explanation for why you think you deserve it why is justifiable why it's a legitimate thing to ask for I'm going to pause here because even these two elements of the equation often end up conflicting with each other occasionally people will tell me here's what I'm planning to tell them and a lot of what they're doing is element to explaining why they're so good explaining how many other people are interested in them explaining why they're the best MBA student and how although you've never hired an HBS MBA student before I'm really going to bring a lot of value but the way you're going about targeting number two is making them like you less alright so you need to make sure you're balancing these two they need to want to do it for you because they like you and they need to be able to want to do it for you because it makes sense to do it for you alright next they need to be able to justify and act on it internally they may like you they may think you deserve it but if they have constraints that you haven't fully acknowledged or understood you're still not going to get what you want and different organizations different people have different constraints so you want to spend a lot of time figuring out where they're flexible where they're not flexible some of you will run into this when you're going towards a non-traditional job versus a more traditional job for HBS graduates on the one hand many non-traditional jobs are likely to offer lower salaries if they haven't hired a HBS MBA or any MBA before and they're not used to these levels on the one hand they may start out offering less and may end up offering less on the other hand they may have much more flexibility on structuring a more creative deal a more interesting deal a more valuable deal for you than the standard folks that hire at HBS so understand where they can give alright and how they're going to justify it internally the person at the table needs to like you and think you deserve it they need to be able to go back and be able to sell it internally if they're hiring twenty other people from your school or from similar schools they maybe can't just give one of you a certain kind of a sweetheart deal no matter how much they like you alright next you need to be to the extent possible flexible on which currency they pay you in you shouldn't care about salary you shouldn't care about you know your bonus you shouldn't care about your options you shouldn't care about which city you're in you shouldn't care about any one of those things what you should care about is the value of the entire deal to you and the more ways in which you give them to pay you the more likely it is that you'll get paid so it's sort of as a corollary to the point before it which is you know they may have constraints in some areas and not in others they may be able to justify certain kind of movements but not others they may have strong precedent concerns in some areas but not others understand those and give them the flexibility in rewarding you in many different ways including maybe not rewarding you today but rewarding you later on maybe you can set up a process by which you're not getting anything special today but you're going to get something as you go forward so think a little bit more holistically in that way and you add all those up and you get a smiley face and it's kind of small but you know most of the things you're going to go she will be small relative to the bigger things in life so but you get your smiley face as I was walking over here I did think what there is one other thing which sometimes maybe doesn't fully fit into this equation but it's important to keep in mind and maybe this will come up on another point as well they also need to believe that they can get you all right nobody's going to go fight for you go to bat for you expend political or social capital internally for you if they think at the end of the day they're going to go all-out for you're going to say thanks but no thanks nobody wants to be the stalking horse for the other job that you really really want and that's understandable you're going to be asking people to go out of their way if you're asking them to change what they originally gave you so you need to be able to deal with that concern as well again these things sometimes are intentional to another there's a little bit of a contradiction here it may be the way you get them to like you most maybe the way you get them to really want you is by explaining to them that everybody wants you but the more strongly you play that hand the more they may think whether we're not going to get him anyway we're not going to get her anyway she's too in demand so you had there's gonna be some judgment at the end of the day there's going to be some tension it's not very easy to just add them all up but these are the things you want to be doing alright so that's that's the first big point number two don't negotiate just to negotiate this is especially important if you are taking a negotiations class while at Harvard Business School you take a class on negotiation if you're like well I took the class I need to to just if I haven't taking it so I need to go out and show something for it it's not the way to go about it there's many more important areas in your life where what you learn in a negotiation class are to business school are more usefully applied then in your first job with your first boss just trying to prove that you can get something alright so if something is important to you absolutely if you truly think you deserve something more something different absolutely think about the interests that are really important to you but don't haggle or negotiate over every little thing you don't want to you know fight fight fight in order to get a little bit more in order to feel like alright I got something and then have a lot of negative consequences down the line alright so don't negotiate just a negotiate but if it's important if it seems relevant if it's justifiable by all means okay this is perhaps the most important thing well it's probably the second third most important thing I'm going to say in these 15 but it's it's the most important thing for negotiations as you start out people often have the sense that negotiation is about walking into the room walking up to the negotiation table and convincing the other party about X Y or Z about influencing them about persuading them about getting them to move in the direction you want them to move that plays a part but nothing is fundamentally more important than understanding the person on the other side of the table from you who are they what do they like what are their interests were their constraints learn as much as you can not just at the table before you get there and after you leave you shouldn't be negotiating with a company or even interviewing with a company without exhausting all sources of information that you can before even walking in talking to folks in the career and professional development Department talking to friends who have either interviewed there or have worked there or are planning on working there talking to folks that are in that organization who you may be able to have access to learn as much as you can not just in order to have a good interview all right so I can say the right words I can hit all the the key things I know their culture but to fully understand what they're looking for you in terms of the value you'll bring to the table in order to understand where they may or may not be flexible in order to understand why they're interested in you specifically the more you get the better you're going to be as you start negotiating down the line okay next I negotiate multiple issues or interests simultaneously here's what that means you get an offer and there's two or three or four or five things you don't like about it so you decide to let them know that you want a different offer what's not a good idea is to send an email that says you know the salary is kind of low could you do something about it and then they work at it and they come back to you and then you say okay and there's these two other things that I'd like you to work on and then they do those and then you come back okay just one more thing all right you can imagine why that's really annoying all right it's also not very productive again they're going to go to bat for you if you asked them to do ABCDE what's often implied is if I do ABCDE we can get you if all you do is send them a request for a salary or a change in city and that's the only thing you mentioned and they start working hard towards it they're not going to be particularly in a giving mood when you go to the next stage the other reason to do this or the other way to do this when you mentioned the two three or four or five things that you think need addressing and hopefully it's not as many as five or six things but the few things that you need it's also important to signal to them what is most important and what is less important and the reason is this if you talk about salary and start date and and you know your bonus and and your stock options or your the city you're going to be in and you mentioned four or five things you don't tell them what's most important they may pick two things that are pretty easy to give you and they give those to you and now they feel that they've met you halfway and you feel like they gave you something not very important so there's one or two really important pieces of interest for you you want to signal that to them you know these are really important I'm a little bit more flexible here but if you can do something that's great but I really was hoping we'd get some movement on these all right now again you want to do it in the appropriate way you don't want to barrage people with you know a list of demands so you want to limit the demands anyway perhaps but when you're doing it don't just go into the end one more thing and one more thing and one more thing if you have legitimate concerns or interests present them together there are occasions where these rules are not appropriate so there's against some judgment but this is in general how you want to be thinking about it so I always leave a little bit of an exit there remember that what is not negotiable today may be negotiable tomorrow this comes in a few different forms one I alluded to earlier maybe there's not much movement today because they're hiring twenty people just like you and it's hard for them to differentiate the twenty of you every one of you thinks you're better than the 19 and in their experience it's hard to tell which one's better alright and they definitely don't want to play the game of annoying some people in order to make some people happy but it may be possible to negotiate those same issues six months down the line or a year down the line once a number of things have changed maybe you've had the opportunity to convince them that you are different better more unique or maybe simply they're in a different phase in the employment so they just happen to have more flexibility they can do a lot more things once you're one of them then they can do when you're just shopping around so that's one version of what may not be negotiable today may be negotiable tomorrow there's another version of it what may not be negotiable on day one during the job interview process may be negotiable on day 30 for example they make you an offer and they have a deadline we need to know by November 15th or November 20th or December 4th and you ask them is there any way I can get more time the answer may be no it may be yes the answer may be no okay well that doesn't mean that it's no forever when somebody says no in a negotiation what they're saying is no today no in parentheses the way I see the world today but that same person as you get closer to November 15th or November 20th or December 5th may suddenly have the ability to do things they didn't have the ability to do before so you want to maybe continue that conversation not in the annoying way of calling them up every day and saying how about now what about now I know you said yesterday but it's a new day you know hope springs eternal not one of those but if they've mentioned to you listen you know we can't change the deadline you know we need a certain number of hit rate by November 15th we may need to make sure that our numbers are looking pretty good we can't just allow people to have a few more months otherwise we can't go to our second list of folks well maybe by November 10th or 12 they've already met their numbers maybe they have some more flexibility maybe other things have changed so what may not be negotiable today may be negotiable tomorrow and in a reasonable understanding way you can broach conversations again you're only going to do that if when they said no the first time you ask them and can you help me understand why that's hard to do now you're in a better position to know well what might change those facts on the ground so that goes back to the learning mindset number three they say no you can say okay but you can also say okay I understand that may be difficult to do can you help me understand why that is well that's interesting in the past I've seen that some companies are able to do it and other companies or not can you help me understand under what situations you can and can't have you ever made that kind of a change alright has there been any experience in the last few years or this year where you have managed to allow people to agree later so explore understand figure out exactly what's going on on their end this leads into the next point which is stay at the table it's just a mentality stay at the table don't negotiate and then you're out of there and then there's no communication stay at the table stay in touch you never know when you're going to learn more you never know when they can give you more information you never know when their constraints change when their interests changed stay involved all right don't just check the box got that offer all right now let's move on to that x1 all right stay at the table stay engaged get more information often what they couldn't share with you before they gave you the offer they may be able to share after they gave you the offer what they couldn't share after they gave you the offer they may below to share with you once you've accepted the offer maybe their what they can't share with you after you accepted the offer they can share with you once you've been working with them six months or a year so stay at the table don't just negotiate when it's time to negotiate because hey we need to reach a deal on something stay at the table with them learn as much as you can as important as it is to come up with a good list of questions that you can ask them and learn as much as you can about where they're coming from there's going to be times when the other side throws something at you that you're kind of hoping wouldn't be brought up all right and the only real solution is to be prepared for those tough questions and it is frankly quite surprising how often people walk into negotiations hoping they don't bring that up rather than spending a good amount of time thinking about when they bring that up what's the best way to respond all right this could be them asking you do you have any other job offers or the company you worked with over the summer did they make you an offer and if the answer is no you're kind of hoping they don't ask but that's not good enough well what are you going to say and if you're unprepared the most likely thing that's going to happen is you're going to come up with something that either sounds like a lie or is a lie or is too defensive or it looks like you're just trying to avoid the question all of those are bad in most cases if the question is you know do you have any other job offers and the answer is no a confident no is not a problem you're not the first candidate they've ever worked with their only reason to hire you is not that somebody else is making you an offer though I know there's some industries where that plays a much bigger role than others prepare in advance to answer the toughest question yes go in with a game plan all right here's what I need to learn from them here's what I need to ask here's what I'm going to ask them to improve hit all of those things are great but think about if you're them what are the things they could ask that would put you in a slightly more defensive position and you know brainstorm with your friends talk to other folks say you know how should I respond to this in a way that I can do truthfully and convey the information they need and yet not look like I'm a bad candidate all right there's a quote ation I shared this with my students early on in the course I'll mention it here the story as I hear it goes as follows how many of you know who Mike Tyson is Mike Tyson okay everybody seems to know okay Mike Tyson is a boxer was a boxer a rather aggressive boxer had a lot of problems not particularly the nicest guy here we're going to run into in the ring or outside of the ring perhaps but he was very successful and at some point he was asked the story goes you know how do you manage to continue to be successful when you have to know that everybody who walks into the ring to fight you has prepared specifically to fight you you know they've watched your videos they've read up on you they've looked at every little piece of every little fight that you've had they're coming in specifically with a game plan designed to deal with you so how do you do with it how do you deal with that and Mike Tyson allegedly said well everybody has a plan until they get punched in the face and then the plan unravels and that is generally true in negotiation and it's true in job negotiations you have a script you have these great ideas you already know you deserve it now you've even come up with the language to you know tell them why you deserve it you're a likeable person you have a list of questions you have all these alternatives that you're going to throw out and sprinkle at the right time you got it and then they come up and come at you with an angle that you're either hoping they wouldn't say or you hadn't expected so think about what they might be interested in finding out from you and how you might deal with those things all right okay when they ask you questions that you wish they hadn't asked questions like well if we make you an offer tomorrow will you say yes and you don't like that question because you would like to not have committed to an offer before you've seen it much less negotiated with other people to get other jobs don't get stuck on what they're asking you try and figure out why they're asking you that is it because they want to make sure that you can't negotiate and you're going to put you in a corner and get you to say yes and then once they make the offer you're stuck usually that's not it why are they wanting to know what's going on on their side did they just say it that way because they're not very good communicators and they're just kind of interested in finding out are you excited about this job maybe that's all they want to know maybe they actually have some deadline by which they need to have a yes or no well that's that's different maybe this person really doesn't buy that you're interested in them all right so where is it coming from they ask you a tough question or even not a tough question before you launch into an answer that targets what they asked figure out what world you're in what is their intent where are they going with this maybe the answer to the question doesn't even give them what they really need and at the same time puts you in a difficult position step back can you help me understand where you're going with this oh that's interesting well you know if the question is you know how excited am I about this job well that's easy dot dot what do you need to know you don't have to say yes or no and you don't have to say yes sir you don't have to avoid saying yes or no and look like you're avoiding the question if you engage in a real general genuine conversation about what it is that they're after so what they're asking is important but nowhere near as important as why they're asking it target the why to the extent possible avoid ignore downplay ultimatums of any kind in both directions don't say things that sound like ultimatums don't sale Tomatoes that's over so not just things that sound like oh you don't don't make ultimatums don't make them feel like you're making ultimatums is that a question oh sorry ah you know yeah let me finish tell commands I will go right back to your question that's a really funny thing to do people don't like ultimatums people don't like being told do this or else sometimes we present things that sound like ultimatums even though that's not our real intent we're just trying to come from a position of strength and it comes off the wrong way but it's equally true in the other direction if somebody says something to you that sounds like an ultimatum like we will never do X or under no circumstances can we move in that direction or that's not possible my personal advice my personal approach in those situations is if somebody makes an ultimatum in any negotiation I just ignore it I pretend it was never said and there's a real good reason for this all right it's possible that at some point they or someone else will discover that the position they took is going to end up in no deal and really they could move if it came down to it the last thing I want them to feel at that point is I made this big deal about this ultimatum and now I'm going to lose face by changing my mind all right it's easy to get people in negotiations to understand that they've said something they shouldn't have said or two they asked for something that you can't possibly give them they've over reached the hard part is getting them to admit it and change their behavior they'll only admit it and change their behavior if they can do so without looking stupid or silly or losing phase if they make an ultimatum we'll never do this we can't do this I don't make them repeat I'm sorry did you say never under no circumstances are you sure no that's irrelevant the most I might say is I can see how that might be a difficult thing for you to do now let's talk about X Y & Z ignore it now if it's a real ultimatum if they really cannot do it under any circumstances don't worry they'll repeat it over and over again you don't have to make it a thing let them make it a thing if it's important often people will say things in the heat of the moment out of frustration because they're busy because they didn't think it through in a way that could trap them and you in the corner and what you don't want to do is fuel that fire just get out of the way of those move out of the way okay your question sir no no that's okay there's there are no turns yeah are you recommending that we try and keep that in mind as we pass it we process a question or should we actually ask the question back regarding well you know obviously there's no one right answer to every situation that idea which is actually not so different from idea number three up there which is trying to learn as much as you can at every moment could happen before they've asked you the question they ask you the question you're not exactly sure where they're going so you ask for a clarification maybe you start answering it and then realize you know what I've answered it but I'm not exactly sure whether they like my answer didn't like my answer got what they needed they kind of nodded along why I can ask the clarification now at every point if there's something you don't understand if there's something that's ambiguous if something surprises you your goal should be to investigate alright that's the learning mindset that's the thing you walk into it anytime anybody says anything I didn't expect or I think is a little bit strange or ambiguous the number one goal is let me figure out what game I'm playing what world am I in I don't mean game in a sort of you know it's a game versus then but what kind of situation am i alright the better I understand the situation I am the more wisely I'll deal with that situation so yes sometimes a clarification is important sometimes they put you in a situation where it seems like if I don't say yes or no no matter what it's going to sound like I'm dodging the question there's a is an example somebody one sort of paper on this I thought it was kind of a silly thing to write a whole paper on because it's a very small point but it was a really interesting point how many of you watched Star Trek I knew you watch Star Trek okay I don't really but the story comes from Star Trek The Next Generation and who's who's the the head guy car door all right anyway so apparently he's on some alien planet as he tends to be and you know he's gotten into some trouble and he's being he's brought in front of this court and it's sort of a kangaroo court they're gonna convict him they're gonna kill him all right that's what it looks like of course he doesn't die that's spoiler alert anyway they bring him into this courtroom and he's prepared to make his his defense and his argument but he knows this is kind of silly and at some point the judge says to him now I'm going to ask you a question and if the first word that comes out of your mouth is not yes I'm going to have these people shoot you on the spot and then he says so any the question is something like are you guilty of crimes against you know humanity or something you know just and he's like well that's a tough question to have to say yes to and so he says yes provisionally and then he goes on to his long speech about why it's not really a yes all right so the point of course is that the yes under these conditions yes but yes if we assume this is often a way to deal with situations where people are maybe even unfairly forcing you to take a big position a big stance on something now that's the whole point you don't need to write a whole paper about it I think but it's a really nice point okay okay we're good nurse ah okay so I've sort of implied this they're not out to get you it sometimes seems that way but you understand these people like you and they want to continue liking you it's just that you're not the only concern they have in life which is bad and good so the bad part is well you know they're not doing everything they possibly could or they're not being as responsive they're not getting back to me in time even though I have other deadlines okay that's bad the good part is the part that they're not out to get you you know they probably don't have any bad intent they have their own issues and concerns and so you can work with them in most cases so if they're not being responsive if they're not being sensitive to your deadlines if they're not exactly moving in the direction you want them to move don't assume it's because they don't want to or they don't like you it could be any of those other things it could just be that they're busy it could be that they're having a hard time with their kids at home you don't know what it is but usually it's not that they're out to get you and especially if you're dealing with your future boss they're not out to get you they may have a personality or a style you're not used to which sometimes looks like they don't care about you that may be true it may be that they're really busy but they like you they want to keep you they're trying to hire you and they like you at least as much as you like them all right and the fact is you're also considering other options and so it's kind of normal so don't don't don't get too bogged down about that keep in mind wherever you're negotiating with companies don't negotiate people negotiate and every person is different and part of that difference comes from the role that they inhabit in the company negotiating with your future boss is very different from negotiating with the HR person they require different tactics different assumptions you can get different information from them at the end of the day it may not be as bad for you if the HR person is slightly annoyed with you it will be very bad for you if your future boss is annoyed with you all right your future boss may only be hiring you the HR person may be responsible for ten different people the HR person may be more concerned about precedent your boss may actually be willing to go to bat for you if they can justify it internally so understand the person you're negotiating with what are their interests what are their concerns don't walk away thinking this company doesn't value me because of what one person is doing or saying all right think about who in this company values you and why and how you can leverage that value that you're bringing to the table for those folks in order to have a good negotiation with the different parts of the company all right incidentally this sort of goes along don't let one person in a company ruin your view of the company of course if that's the person you're going to be working with then you may choose not to work there but even there don't over inflate what what person one person says or does okay don't be in a mad rush to get offers this is a quick point on this in the beginning of the job market often we're sort of in a rush to try to get at least one job offer hopefully many but then we get one and then we find out that there's a problem which is we got one very quickly because we rushed it and now they want to know in a week or they want to know in a month but they want to know in two months and really I was kind of hoping to stretch this part of my life out a little bit so it's great to interview early it's you know but occasionally you want to slow down the process don't assume the process should always be sped up sometimes of the better process is a slower process you know again there's some judgment calls right you don't want to slow it down so much that they lose interest or they hire someone else etc but don't always be in a rush to get this negotiation done as quickly as possible think about the portfolio of negotiations you're doing again that's a broader point it's not just in job negotiations you can't you can negotiate each deal perfectly well but if you're not thinking through the portfolio of deals you're negotiating you may end up in a place you don't want to end up all right so you may want to try for example in this case to have those offers come in a little bit more close to each other then simply one in October one in December and one in February the other ones you might want to move sooner these you might want to delay to the extent possible not always possible all right just a couple more to go here tell the truth I'm not sure how much more I need to say about this because that's the whole point but you know resist the temptation to tell even a small lie this is where everything everybody's been trying to hammer into the the course load and not just in your you know leadership and corporate accountability or whatever the course is called that you know or or the ethics discussions in this closet this is what it comes down to this is in I teach negotiation so this is your first negotiation alright this is the first company you're going to be working with after your MBA these are the people you're going to be working with the long term even if it was a one-off thing don't get into the habit of just saying whatever needs to be said to get the deal done to make a little bit more money in most cases because they're not really out to get you because what really matters and not what they're asking about the intent because there's lots more questions you can ask because you can do all those things on the equation in most cases you can tell the truth smartly and have a good discussion and end up where you want to get that's negotiating yes there will be occasions where you have to choose between well I can tell the truth and I probably lose a little bit or I can lie and get it now is the time to get into the habit of never doing that don't lie in any negotiation I know it's it's kind of like a stupid thing to say because you are who you are and and and you may not even have to think about it and it may sound kind of preachy now which it is but it's important so so so don't do it next shoot for an 11 out of 10 what do I mean occasionally in a negotiation class well we'll do a negotiation and afterwards we'll ask people to rate their negotiation partner on a variety of dimensions so imagine a dimension like how much you look forward to working with this person in the future when you're negotiating with your future boss or with the company anybody from that company imagine that they're going to go back into their office after having the negotiation with you or after reading your email or whatever and they're going to do two things one they're going to either give you or not give you what you asked for but in addition they're going to write down on a scale of 1 to 10 how much do I look forward to working with this person and you should really be shooting for an 11 at that point you don't want a nine you certainly don't want an 8 a 7 a 6 or 5 or a 4 any of those you don't want a 9 heck you don't even want a 10 you want even that negotiation to actually make them want to work with you even more than they did before you ask them to give you stuff that's the goal to negotiate in a way openly honestly with empathy with understanding with give-and-take with due deference to their constraints and what they can't be flexible on so that when they're done even having improved your offer they like you more than they did before because of the way you interacted with them that's the goal more than before and finally everything I've said is less important when it comes to job negotiations than this point if you're thinking about how happy are going to be in life how well you negotiate your job offer is almost if not completely unimportant what is important is which job you take and what kind of industry you go into what kind of career path you decide to go down those decisions are going to be worth so much more to your ultimate happiness peace of mind etc then anything else you do at the negotiation table there's just no denying that alright we know from significant experience research etc that many of our MBA students are not particularly happy a few years out and many of them continue to not be very happy many years following that especially when it comes to the career side of things and you're never going to have as much opportunity and time to reflect and and an options not just opportunities and jobs but options that consider who you really are as you do now some of you will occasionally hopefully you can build that into your life but this is a pretty good time to figure out who you are and what you want to do if there's something that you always kind of thought you might want to try there's a part of you that you haven't been able to really really manifest in your career so far get that part right don't again nobody thinks they're following the crowd but at the end of the day there's a crowd and everybody seems to be in it so you know think about who you are you know I don't think anybody here thinks they're the average Harvard Business School MBA student and so don't end up behaving like the average Harvard MBA student and so think about who you are what you want to do and if you can pick that correctly and make some tough decisions there now you're going to end up in a pretty good space the point I'm making here simply is the first step matters what you do now matters because usually the second step is just a continuation down the same path we take the first step and then we take the second step and we take the third step and the more steps we take the harder it is to pivot to turn around change course etc for a whole host of reasons that should be obvious all right okay I'm going to stop here we have still plenty of time and what I'll do is I'll take any questions you may have hopefully some of this was useful undoubtedly there's other questions that each of you have that are perhaps idiosyncratic but maybe even not so idiosyncratic that I can touch on so if anybody has any questions what I'll do is I'll take a couple of questions and then I'll just try to hit all of them as efficiently as I can so if I can just get two or three questions all right how do you find out information about what is on the table so let's let's do the two these together can they seem to be pretty well okay on the technical side when somebody asks how can we make this better for you it could be that they're asking for at least some answer in the next 15 seconds but I don't know of anybody who would be offended if somebody said you know I think that's a great question obviously I've given it some thought but I've learned so much more in during the interview process would you be okay with me coming back to you after I sleep on it a little bit more I mean would you be offended if somebody said that to you no I don't know anybody who'd be offended by that so if you don't have a good answer and the honest answer is I need some time then that's the answer you should give that alright if the question is you know is this good enough or are there things that we could improve you said well you know I appreciate the offer it's very nice there are some things that I might want again if you're prepared you launch into it if not you take your time all right whether you need a day or a week again what's the honest truth what do you need it for right would it be okay if I came back to you a week later because that gives me the opportunity to talk to some of the other folks that I got to meet today so can I think I'd be a better person to answer that question after that rather than right now so I think those are all perfectly appropriate don't feel compelled to answer it right away unless of course their intent is they need to write something now okay so again now now what do you ask for in some sense how do you find that out well again in general if it's a company that hires tons of people from a school like this well you can probably find out just by talking to other folks and you can know that they'll probably be a little bit less flexible on certain issues it becomes more interesting if they may have some flexibility and talking to the people that are at that company learning about their culture and what they seem to value looking at how long people stay all of those things give you some information but at the end of the day there's nothing wrong with asking the person you're negotiating with listen there are certain things that I was hoping would be a little bit different we discussed this earlier you know the salary is obviously a little bit lower than my other offer than what I was making before in addition you know I was kind of hoping to start here two or three or four things can you give me some idea as to where you may have greater or less flexibility right at the end of the day I want to work at a company that not only do I love and for whom I can create a lot of value but I want to create the kind of package that works for both of us and I know what I need maybe overall but I'm flexible on how we get there so can you help me understand what's easier or you know maybe they've already signaled to you for quite a while that they can't be flexible and X fine explore a little bit more when is there flexibility on that has there ever been flexibility on that if not where do you tend to be more flexible or talk to the current employees there did you negotiate your offer did people take to it okay were they okay with that okay and what worked and what didn't work I think people are usually okay with that kind of conversation all right get a couple more yes sir thank you if you make their mind um you haven't acted um but you know when it's the open offer or offer well but it's a best time for to go back you don't want to go back when we have only like one option and let them know that you have already have any alternatives those beginnings okay okay let me ask you a couple quick questions so are there other companies that you think might give you an offer that you would like more than these folks or okay's you're still shopping on and some of them may beat this or are you shopping on but this is still your going to be your best you think we wanted to so you're waiting more than any reason because there may actually be some that are even better than this okay so one of the things that this gets to is this notion of staying at the table I think you want to stay at the table if you are at all concerned about them having made a verbal offer but then you know over time that just sort of dissipates that they sort of lose their commitment to it they're already fully looking for other people you may miss the boat if there's any risk of any of that you want to make sure you stay at the table and at least stay engaged you don't necessarily have to rush a written offer but if every week or every couple of weeks or every month you're talking with your boss from the summer and saying hey listen I just wanted to update you and how things are going just wanted to see how things are going over there can you help me understand what the process tends to be for you folks when you have a summer intern learn what the process tends to be when did they need to make hiring decisions don't push them on an offer if you're not in any rush to get one but just make sure there's no chance that you get tossed from the list simply because you didn't seem interested so if there's any risk of that stay at the table learn more about their process make sure they know you're still interested but don't push them for something in writing unless they say well you know what actually I'm kind of glad you called we had kind of started to think that maybe you're not that interested we're actually in the process of giving offers now oh well glad I called what's the process typically you make offers and then what would you be flexible in that okay what do you need from me etc etc so stay engaged expect you to talk use sorry take it graduated in 94 you graduated in 94 yes I do expect a new conference here today I just want to hear listen a new workforce 20 years I think the important number which I'm number don't rush your offers ah it's the best point that's the best one all right okay put that number one next time or just put it in bold maybe years about challenges ah okay good more questions like more questions like that would be welcome so when is what over that you're not getting the job where they're not improving the offer well there's some sure signs get really annoyed at you you know stop but you know here's the general rule and then how you apply it tactically differs so my view is this you never want a negotiation to end with a no you want it to end in one of two ways either a yes or an explanation as to why not so when somebody says no to me that's okay sometimes they can't do anything I get that this may be out of bounds it may not be possible too many constraints no they don't what I want to do is if I get a no I want to at least understand why not once I have an explanation for why they think they can't do it then I can make up my mind as to okay this is probably not beating worth feeding my head over alright so if there if I have no idea why not then maybe the conversation should continue but once they've explained to me why not and there doesn't seem to be much that I can do about it that's great so that's 1s answer make sure you're not just getting know enough I've times make sure you're getting know once and then for explanations if anything alright the second piece of it is often they'll be signaling to we really can't do anything and you'll push back a little bit more and they'll say something like you know oh you know I thought we kind of made it clear that that's not possible okay we'll take that as a hint you know if they're having to repeat themselves and it's not because you're asking the same question over and over again then then that's maybe another signal but again keep going until you get what you want which may not be the case but at least you understand why they're not giving it to you and then it's perfectly fine to say okay it's not worth doing another opportunity I should do you I just I mean can you say that like oh my other offer is paying me X you should also pay X or what is what are the best ways okay so as it so it depends so if the other offer is paying you a lot less that's probably not the right thing to do so I said so in a world where your other offer is pretty good or more and the other offer and again you may not have any other offers but the other things that you can bring to the table what you used to make before you started your MBA is a perfectly fine thing a perfectly fine thing to bring up what the average MBA student makes is a perfectly fine thing to bring up what the average person in this job or industry makes is a perfectly fine thing to bring up these are all types of justifications for what you want to ask for so yes one good one is my other offer is offering X whether you have that or not what you're probably going to do is say how can I make a compelling case that I deserve more and you just happen to have picked one of the four or five or six ways in which you can do it and you bring it up depending on whether it's worth bringing up whether it helps make the case and what's relevant to the people on the other side some people are glad you brought that up because when they go back to their committee and they have to say hey we got to give this guy more because you know he's got offers from X Y & Z and at least two of them are significantly higher than what we're paying and it's we could stretch and make it great other people don't even care to know about that they're in a different industry they say I know you're making a lot more there you may still bring it up because you want to push them up a little bit there's no doubt about that but it won't necessarily play the same role so what you want to think about is all the justifications I can make to justify the offer I want to ask for so they're offering me this I want this what's the story I need to tell them sometimes a part of that is yes I have other offers and they're here but just remember if your other offer is here you may lose them on are we ever going to get this guy so if you're going to bring up that offer they better be followed by and of course I know you can't match at that level but I did want to suggest to you you know I am willing to give up a fair amount on money to work with the kind of company that you are and the kind of opportunity you give to folks at this stage in the career but to the extent that you can bridge that gap of it it would be pretty useful for me all right so so yes by all means use it don't throw it in their face too hard give it to them as information did you call for just many monsters at one of them goat cheese people are going to do that financial leverage over for them their opportunities sorts of us change you don't really have the ability to one way it easily someone it might have two or three top offers ability to do yeah you know where you come off on the trade-offs changes depending on your situation you've given one version of what makes it hard to walk away alright some people don't walk away because they're too risk-averse some people can't walk away because they have young kids five years from now it may be a different reason so yes the principles I think are all still relevant they don't change but the trade-offs you make may change if what they've offered you is this offer plus implicitly one hundred and fifty thousand dollars or a hundred thousand dollars on tuition well that's part of the offer they're giving you all right and so it's going to be a judgment call now what I think is if you don't fall into the category of folks who you know if you take on that debt you're going to be you know on the street or you have young kids to feed or anything else then then number fifteen is still the most relevant piece of advice which is you know do I want to be stuck here for the rest of my life or am I willing to take that hit and do the one thing I really really wanted to do so if anything I would say you end up having to pay more attention that becomes more salient that you're gonna have to give up more than your friends will on the other hand if they've already paid the tuition then you're really no different the last thing I'll say is the framing matters when they paid for it and you're thinking of it as an additional hundred thousand dollar hit or more it just seems much worse and Dumber to say no to that money then if you paid your own way through loans and yet it's really the same thing at the end of the day so yeah you're off you're making you have a job offer forget you're sponsored you have a job offer and they threw on you know your loan forgiveness or something how much do you value that it's just one of the five or six or seven things you value just like you value which city are going to be in just like you value your salary and your bonus and the job and the boss and the industry it's just one more thing you value don't over value it because sometimes people put that in just a totally different category oh but sponsorship oh but I'm sorry I got my hands tied I'm not like everybody else no you're just like everybody else you just happen to have identified yet one more interest that you have and now weight it appropriately rather than everything else and then 50% of the variance goes to this now it's probably a lot less alright yes sir constraint sake some of those changes they're putting my period but some of them IT just butchering our technicians what we advise for us to discern reviews yeah a lots of judgment here I'll give you just one piece of advice on this so I find that the kind of the way in which you ask a question has a huge impact on what they share with you even controlling for how much they intend to share with you so they either want to share a lot or not we can't necessarily change that in a moment but how we ask can make a difference so when somebody says no we just can't do that questions that sound like one of the following I'll give you two examples I guess I often ask people imagine the situation where you could do that imagine a world in which that was possible describe that world to me what would have to be different about that world in which you'd be able to do it and then people have to paint that picture for you and it gives you a little bit of a better idea about what is causing that constraint alright another possibility a little bit along the lines of what we've already discussed is can you give me an example of situations where you've done that now it's easy to make you say I just can't do that when people say I just can't do that in their mind they're interpreting as I'm telling this person this would be very hard for me to do I'm not really lying to this person I just said I just can't do that but when you ask them have you ever done that before in any conditions and they have they're a little bit more likely to then have to quote-unquote fess up and say well there have been extreme cases where we've ended up doing that you know can you tell me when that happened I know I may not fall into one of those categories but it's just kind of useful to know how the process works and then sometimes they're a little bit more to it right now there's other things you can do you can talk to other folks you can triangulate you can say well the HR person told me this what do you think you have to be careful that you don't look like you're going over someone's head but you can still try to get information from different angles and see if that helps as well do you talk like that different type of advice for negotiating and like really small company or is it 5 to 10 people no HR at all and where if you have a really close relationship well you know in some ways everything we're saying becomes even more important right so it probably means that the the range of outcomes is much higher you could end up getting a lot less or a lot more because there's very little precedent they're not concerned about the other people they're hiring that year potentially you have a relationship so there's already some goodwill there so I would say you know being more honest becomes more important learning more about what they can and can't do becomes more important making sure they like you becomes more important and the range of things you can get for them is a lot more now keep in mind I'm saying the range is bigger I'm not saying the upper end of that range is higher than what you can get with a traditional offer but if in a traditional offer the range is this in a non-traditional setting the range may be this all right and so you want to play your cards right even more so and by playing your cards I mean learning as much as you can about where they're coming from and there's one more thing it's not here influence and persuasion does matter a person who's never hired a Harvard Business School MBA or any MBA is maybe even more open to learning from you what it is that you can bring to the table maybe they're under valuing you not because they don't have as much money they're under valuing you because they don't know what you can do well alright so if you can make the case if you can advise or inform them about how much other people make in companies like this or in with the kind of experience you have they may be more persuadable so maybe that range goes from here to even here so that may be possible as well so it becomes more of a two-way conversation not just understanding and structuring but educating them as well about what's possible the last thing you want is to be underemployed by the same company that could have given you full employment all right if they're going to put you in a role in a position because they think that's their need but you can do even more for them have that conversation that's the best conversation you can have what if we were to increase the scope of what I can accomplish maybe not today but over the next three years could we structure a deal that if we do this isn't this I'm in this position so so all of this I think just becomes more important because where you can end up is so very so you mention the currencies the flexibility of currencies what are you created and often overlooked types of currencies that end eased open to table or everything except salary I mean I think people are overly focused on salary more than they're under focus on any one thing I think that's definitely a piece of it but what's the standard stuff I mean I mean okay I'll be lied one thing which I briefly touched on before so certainly you can just list all the things you care about you know which city are going to be on what kind of project you're going to be on what kind of responsibilities you're going to have what your start date is you know if you want a summer off or whatever else you want to do people may be able to give you some money for your MBA you know the loan stuff but it's putting yourself in position for the next negotiation which is often a good thing to do and maybe the last thing that you could ask for is to say I can't do this I understand you can't give it to me today but can we do something about this in six months or a year and people are often more open to that now the easy one is being in a different office or a city sometimes you can work that conversation in fine we can't start there today but can we do that in X amount of time but that's also true about your first performance review it's also true about the kind of bonus you may get you know I know I'm starting halfway through the year and my year end bonus is going to be prorated accordingly but could we make a case we're getting the full year because dot dot dot all right so there is some of that that you can do I think one of the things that we often forget to do is negotiating for things that they can give us in the future it's often a lot easier for people to say yes to something that they don't have to give you for a year then to say something yes to something they have give up right now when they're in the middle of a very bureaucratic process the only thing to keep in mind is they may just promise that and say it but you need to stay at the table over that next six months to a year to make sure they don't forget it to make sure that they didn't leave the company and now nobody in the company owes you that to make sure there was no misunderstanding to make sure that as the company's needs change they don't conveniently ignore it so again in a respectful sort of way you want to make sure you're at the table in making sure those things happen see the situation work we have another offer and they're coming exactly for what the offer letter is going forward let's say you have two options we can give that altar and okay you match it back or we can say no I'm not going to tell you what your offer is I better here first fact that you have to say and taking the second option the HR person sort of advises you not to take that route rather says larger company you know people who actually can make decisions only to see give me a sub now still if you don't want to do it it's fine but I highly advise you know when something highly advises you to do something you know it's probably a good idea especially in a conversation where they're not out to get you really but the question was you know you have an offer from company a Company B wants to know what a company is offering before they really structure their offer yes and you know ideally that doesn't come up but if it does again if a is pretty good you tell it and I mentioned this to you when we were talking offline but the way I would think about it is a couple things one if offer a is also negotiable you can signal that when you tell them what it is so I say well I have X as my salary from offer a but as you know even that's negotiable and we haven't discussed those so it's going to be this or higher so that gives you some leverage for the future the other thing is don't let them walk away thinking all you care about is that one issue either at the end of the day you should have the ability to say I know you're offering the same amount as them but for the following reasons I could use some more all right now you have to think about what those reasons are and what it is but you know or less you know they should also be able to know whether you can accept a deal that's different on salary than the other one so I would say listen you're asking me to say something that I feel uncomfortable about not because I have any problem with the transparency element but because I think I'm transparent I'm just one element you may overweight that in your own discussions right so you know what they're offering me on salary because you can compare those but there's lots of other things about that job that I wish you could understand as well so that the package of offers you make me is compelling so here's the offer here's here's what it is it's higher than what maybe you are used to but let's have this be a conversation so if you're welcome to having this as a conversation rather than a one-off thing then here's the information you need again if you can avoid having to give up too much information before you get an offer great but if they're saying listen everybody knows you have this other offer and they'll know you didn't want to tell us what it is bad taste in people's mouth number one is the problem they don't like you and everything else is almost secondary and this is before they've given you the offer so it's one thing to be disliked after they've given you the offer very bad much worse to be disliked before they've even chosen to hire you we're at 4:30 I'll take just maybe one or two things like exit clauses and things like a non-compete those are kind of unpleasant things to talk about while you're getting an offer any advice of them happens I think I know what you mean by when when they're how do you guess any tips on how to negotiate that but getting them is not much because you're talking about a prenup or divorce ordinary is it much as I cannot compete so like is there any way to have that conversation without leaving about yeah just maybe a little more in your credit cubits oh we get to talk about this afterwards but in general keep in mind both sides tend to know these are uncomfortable conversations and legitimate conversations I don't know people who don't at some point you know people who are hiring understand that folks don't like to be too tied down because this may not work out it may just be a bad match etc at the same time if you look like you just want all the flexing in the flexibility in the world you've never signaled real commitment anyway you might fall into the category of the people that they're most worried about it's about striking the balance it's about understanding what exactly their core concerns are maybe you can carve out some kind of non-compete that's not a very broad non-compete say listen what's your real concern well our real concern is you end up with company X okay what if we carve that out well real concern is you get training in the first six months you're gone in the seven month and all of our investment is gone what if we made the non the non-compete a little bit shorter than the four years you've proposed understanding where they're coming from why exactly they want something gives you more options always then you can maybe meet halfway or target their core concerns still show some flexibility and work on all the other elements that they're worried about and maybe you can reach some sort of deal I'm going to be mindful of where we are at the time and I also have to go home and another way I'm pick up my kids so I definitely want to lose that negotiation sort of I'll stick around for another just maybe you know five minutes here if you just want to stop in and either say something or ask them really quickly on the way out good luck with your negotiations good luck with your career search and your career and you know stay in touch is something really interesting happens you know and be happy all right take care you

Channel: Deepak Malhotra

Views: 1,226,289

Rating: 4.9060802 out of 5

Keywords: Negotiation, job negotiations, Negotiation Advice, salary negotiations, Harvard Business School, HBS, Advice, Tips, Strategies, Tactics, career advice, negotiating with your boss, job offer, job offer negotiations

Id: km2Hd_xgo9Q

Length: 64min 23sec (3863 seconds)

Published: Tue Nov 20 2012

Reddit Comments

[u/GuessImageFromTitle]

Most useful link yet in this sub I've seen. More like this please and less blogspam.

[u/[deleted]]

The 19 things he mentions in the first 35 minutes:

• They need to like you

• They have to think you deserve it ;always explain why you deserve it. Balance this with them liking you

• They need to internally justify your wants. IE: salary max, only have one desk left, can't give you better salary than your peers. Understand where they can give.

• You need to be flexible in your currency. Don't care about money, care about value.

• They need to think they can obtain you. Don't be too in demand

• Don't negotiate just to negotiate.

• Understand the other person on the other side of the table. Both before you get there and after you leave. Learn as much as you can.

• Negotiate multiple issues simultaneously. Don't make it an email chain, do it all at once. Also let them know what is most and least important at that time.

• What is not negotiable today maybe negotiable tomorrow. 'No' can change as you get closer to a deadline. Ask questions and explore.

• Stay at the table. Learn more, stay involved.

• Prepare in advance to answer the toughest questions. Don't lie. "Everyone has a plan until they get punched in the face."-Mike Tyson

• Question why they ask a question. Don't confuse what they are saying with why they are asking it. "I'm confused here, why are you asking this question?"

• Ignore/downplay/avoid ultimatums. People don't like them. If they give one, ignore it. They can usually change it, but admitting that is hard and embarrassing. If it is really a no-go, they will repeat it.

• They are not out to get you. They like you and they want to continue liking you.

• Companies don't negotiate, people do. Don't confuse the company with a person at it.

• Don't be in a mad rush for offers. Sometimes the turtle wins the race.

• Tell the truth. Resist white lies. Don't lie to get more. Don't get into that habit.

• Shoot for 11 out of 10.

• Life Happiness does not correlate to job negotiation skills. What is important is the job and location, not the money. Don't end up behaving as average, behave as you. Make the hard decision now.

(Can't find the TNG episode in question at 26 minutes, sorry)

[u/SentimentalGentleman]

As a recent graduate: Thanks a lot for this!

[u/jdedward]

Now I just need a job offer.

[u/battleborn]

Did anybody else find a lot of the things he said to be common sense? I thought this was a rather interesting video to see a lecture in the life of an HBS student. I also found it to be weak, though, to think people considered to be top notch need to be taught to be likeable...

[u/Shringdangle420]

Wow. This was so inspiring. Brilliant lecture.

[u/Beardwing]

Typo in the first second. Good start.