Four Practical Ideas: How to Negotiate Your Salary (London Business School Review)

(Written with Anna Johnston, London Business School). This article was originally published on London Business School Review

 

No matter what your gender, negotiating your salary is a true art. But women have added social and cultural barriers to contend with. Giuseppe Conti explains how to get the compensation you deserve

Women are only now earning the amount that men did in 2006, data from the WEF’s 2015 ‘Global Gender Gap Report’ shows. Incredibly, the forum says it will take another 118 years to close the gap.

What if more women asked for that all-important wage increase? Could it serve as one solution to a much bigger issue?

Barriers to asking for more

A new job offers the ideal opportunity to increase job compensation. Yet for women, navigating complex barriers to job negotiations – including a blend of social, cultural and environmental factors – is, according to surveys, as appealing as “going to the dentist”. Yet when asked to choose metaphors for the process of negotiating, men picked “winning a ballgame”.

Of course, no one woman falls neatly into any one barrier category. But across the board, a set of common factors hindering job negotiations exists.

Challenges include:

a) Focusing on relationships

Women are more likely to worry about the impact their career negotiations might have on the relationship with their manager.

b) Setting value

Women tend to make smaller requests versus equally qualified men.

c) Cultural stereotypes

While men are often considered self-oriented, women are often perceived others-oriented. As a result, women might suffer a ‘social cost’: a backlash after assertively asking for a pay rise.

d) Humility

Women are more likely to have higher levels of humility; it’s called the ‘male hubris, female humility effect’. Women are less likely to attribute success to themselves (and less likely to take advantage of it).

How to build negotiation confidence

 

1. Don’t limit yourself to pay

Be clear about what you want. Job negotiation doesn’t have to be just salary negotiation. Once you know what’s important – be it flexible working hours, a specific team, or working from home – you can set your negotiation priorities accordingly. You should negotiate for career satisfaction and success, not just for money.

2. Research the market well

When information is uncertain, women tend to have worse results in career negotiations. The more you study the market and are clear about what is and is not possible, the more confidence you will have.In your research, scan published data as well as asking your network. When you benchmark compensation, do so with both men and women. Women are more likely to compare themselves with female counterparts and, due to the pay gap, set their benchmark too low.

3. Build your business case

Frame your message with company benefits rather than personal needs. Ask yourself: how will this help the company? Take Sheryl Sandberg, COO of Facebook. In her book Lean In: Women, Work, and the Will to Lead, she recalls her salary negotiation with Mark Zuckerberg. Sandberg said: “You want me to be in charge of your deals, you, therefore, need a strong negotiator. Be reassured, this is the last time that we are on the opposite side of the negotiation table.” Her concern for the organisation improves the social impression of the ask. For more insights in framing your application, take a look at ‘Framing your message for a successful negotiation’.

4. Take a collaborative approach

The notion that women more often than men take a collaborative or cooperative approach to negotiation is frequently cited. This approach often creates agreements that are better for both sides. So try perceiving salary negotiation as a joint problem-solving exercise. Let’s assume you want a total compensation of US$125,000, but the company’s only offering $110,000. Your reply could be, “I understand that because of your salary bands you can only offer me a salary of US$110,000. In order to be satisfied in this new role, I need a total compensation of $125,000. What benefits are you able to offer me to bridge this gap?” Such an approach would help you negotiate effectively, while remaining cooperative.

The positive effects of asking for more

By negotiating your salary, you may experience other positive effects too, says Conti. He suggests four well-being benefits from simply asking for more.

1. When negotiating, you strengthen your brand. If your job involves negotiation, by asking for a wage increase, you might be perceived as a ‘better professional’.
2. You are more likely to increase your compensation, not just once, but over time. The cumulative effect can be substantial.
3. As you increase your compensation, you are more likely to be promoted. In fact, companies believe employees that are paid more, are better employees – much like we believe that a more expensive wine is a better wine.
4. As more women get promoted and receive their real-value compensation, it will go some way towards parity.

Next time you’re faced with a decision on whether to negotiate your salary or not, evaluate your mindset and take a positive attitude; because remember, confidence breeds competence.