Negotiate Your Salary—Better

Negotiate Your Salary—Better

NOTE: While this transcript has been reviewed, it may contain errors. Please review the episode audio before quoting from this transcript.

Jill Wiltfong:

How to negotiate your salary better.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

25,000

[Rene Russo Nina – ‘Nightcrawler’ movie]:

8,000.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

15,000.

[Rene Russo Nina – ‘Nightcrawler’ movie]:

9,000.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

15,000.

Jill Wiltfong:

More than half of job candidates don't even try to negotiate their salary.

Sonal Bahl:

I'm gonna say the main reason for this is fear. If you don't ask, the answer is no.

Jill Wiltfong:

But what's going through the managers' heads?

Dan Kaplan:

People think they're gonna get the moon and the stars, and managers never have enough to give out. No one will ever be satisfied.

Sonal Bahl:

And then, silence. Stop talking.

[Boss]:

So, I just wanna say that your work so far has been outstanding.

[Employee]:

Thank you. I try my best.

[Boss]:

Honestly, I don't think I've ever seen an employee over deliver by so much so consistently over the years. I mean, I could just go on about how fantastic you've been.

[Employee]:

Wow, I think he's finally going to give me that raise. Okay, don't be overeager. Wait for it. Wait for it.

[Boss]:

Anyhoo, I just wanna let you know how much I appreciate you always going the extra mile.

[Employee]:

Er, thanks. I guess I'll go back to work then.

[Boss]:

Great. Stop by again anytime.

[Employee]:

All that hard work for no payoff, how dare he. Time for me to start looking for a new job.

[Boss]:

Hmm, wonder why she didn't ask for a raise. Had the paperwork ready to go and everything. Oh well.

Jill Wiltfong:

Hi, I am Jill Wiltfong, Chief Marketing Officer for Korn Ferry. And this is "Briefings," our deep dive into topics that corporate leaders need to care about. Here's an interesting statistic, almost 6 in 10 people who get hired don't ask for more money than they're offered, and yet, get ready for this, almost 9 in 10 of those who do ask end up with higher compensation.

Welcome to that weird world of asking for more money, or if you have a job, a raise. Certainly the hesitancy to push for more money is understandable, especially in a job market when many professionals say they're just not getting the offers they used to. Indeed, the latest Korn Ferry Pulse survey projects that base salary increases are going to be at best flat compared to last year and potentially even slightly lower. So, we've done a little digging here and found some pros who can go behind the scenes and tell us how the whole process works. No, we can't guarantee you'll end up richer, but I have a feeling this episode is going to be one of our more popular ones as we dive into how to negotiate your salary better.

Before we start, if you're watching us on YouTube, please be sure to like, subscribe, and leave a comment to let us know your thoughts on this topic. So, I'm joined today by Sonal Bahl, a career strategist who's helped thousands of people get a better payday via her insightful YouTube channel as well as her consulting practice. Sonal, thank you for joining me today.

Sonal Bahl:

Thank you so much for having me, Jill.

Jill Wiltfong:

Before we get into the nuts and bolts of negotiating, which I know is an expertise of yours, one survey found that more than half of job candidates don't even try to negotiate their salary, and that matches with what you've observed as well. So why do you think that is?

Sonal Bahl:

I'm gonna say the main reason for this is fear. What if they think I'm greedy or money minded? What if they say no, and then what? By default, if you don't ask, the answer is no.

Jill Wiltfong:

Right. Right.

Sonal Bahl:

So you've got nothing to lose is what I'm saying.

Jill Wiltfong:

You've said that the negotiation actually starts before you even get into the room when applications are asking for your salary expectations. What's the right way to answer that without either underselling yourself or completely pricing yourself out of the market?

Sonal Bahl:

I prefer not giving a direct number or a range. And if they force you that you have to write something, sometimes you know they're very clever now, so they have a text box so you can say the word negotiable, or, you know, I'm open to the right opportunity. Or you can write, if they say no, you can only put numbers, then I would say just write zero or write one, but avoid, you know, because you don't know what their budget is. So, if you give a number, you don't know, maybe their budget was 150K and you said 90K would be good. Who knows, you may have left 60K cash on the table.

Jill Wiltfong:

So, let's say you did get in the door, you've gotten past the application, and you're looking to schedule a meeting to actually now discuss salary. You say there's a specific day of the week that often leads to better outcomes, which is really interesting to me. So what day is it and why?

Sonal Bahl:

I am a huge fan of Thursday. The reason I like Thursday is because in some cases it may not be so straightforward, right? It may be like, you know, there's a little bit of back and forth going on. So, if it's not super duper complicated, it can be finished by Friday and the hiring manager, or the recruiter, or the VP of HR is, you know, they celebrate. Thursday, sort of gives you that. And my bonus tip here is Thursday after lunch is even better. So you know, you don't have a hangry person who's looking at you like, "You're between me and my veggie burger," on the other side.

[Rene Russo Nina – ‘Nightcrawler’ movie]:

5,000.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

30,000.

[Rene Russo Nina – ‘Nightcrawler’ movie]:

7,000.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

25,000

[Rene Russo Nina – ‘Nightcrawler’ movie]:

8,000.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

15,000.

[Rene Russo Nina – ‘Nightcrawler’ movie]:

9,000.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

15,000.

[Rene Russo Nina – ‘Nightcrawler’ movie]:

10,000

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

15,000.

[Rene Russo Nina – ‘Nightcrawler’ movie]:

Give me a serious number.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

15,000.

[Rene Russo Nina – ‘Nightcrawler’ movie]:

Can't do it. Never happen. There's a matter of precedent. Ten's my last best offer.

[Jake Gyllenhaal as Lou – ‘Nightcrawler’ movie]:

Okay.

[Rene Russo Nina – ‘Nightcrawler’ movie]:

Really?

Jill Wiltfong:

That's a scene from the movie "Nightcrawler" in which Jake Gyllenhaal believes he's being underpaid and negotiates for a rate that he feels is fair.

So Sonal, let's say you're sitting down with a hiring manager and you've just gotten the offer, but it's below your expectation. How do you approach that situation?

Sonal Bahl:

I have a four-step process to sort of think about how to approach this. The first one is always come from appreciation. The second I would say is clarify, even if you think you know everything. So, this says this is 95K annually plus 20% bonus. Is that correct, Jill? Jill says, "Yes." Okay, so you know this, but you're still sort of buying time. The third thing you wanna do is you wanna explain your stance and you wanna use, if you can use data, or you can say, "So, you know, based on my research of the market, you know, Jill, the number I had in mind was closer to 110K. So now I'd like to ask you is this flexible? Do we have a little bit of leeway? Because I am really excited to start." So, there's a four-step process, A-C-E-A. I'm a fan of acronyms, ACEA. Appreciate, clarify, explain, and ask. And then silence. Stop talking.

Jill Wiltfong:

Before you leave, I'd love to touch on some advice that you have around asking for raises, which is to ask for them a year in advance. What do you mean when you say that? And why, why a year earlier?

Sonal Bahl:

If you put yourself in the shoes of the height of the boss, of the manager, and the person in your team says, "Hey, you know, I think I, you know, I deserve more. And what do you think about that?" So the manager doesn't want to say no to you. They wanna see you happy and they wanna be your champion and your sponsor. But no one, no one I know, likes to be blindsided. No one likes to be ambushed like that. What I recommend doing instead is saying, "Hey, you know, Miss Boss, Mr. Boss, I see that in December 2025, I see my career path progressing like this, and I see myself as a senior network engineer," whatever that is. "What do you think about this? And these are some ideas of skill sets that I think I have that I'm strong at. And what else could I be developing?" So, you know, making it a collaborative exercise so there's not like this sort of crescendo building up towards end of year and then suddenly this request comes because they can't say yes to you and then they feel bad.

Jill Wiltfong:

All right, well, Sonal, I have no doubt that you have helped some people pad their bank balance a little bit just from this discussion, so thank you so much for coming on.

Sonal Bahl:

Thank you for having me.

Jill Wiltfong:

So, we've looked at salary negotiation from the employee perspective, but what's going through the manager's heads? Let's find out during a conversation coming up next. Stay with us.

Rupak Bhattacharya:

Hi, and welcome to "This Week in Leadership." I'm Rupak Bhattacharya. And here's a quick look at what else is happening in business.

[Narrator 1]:

The insecure manager.

Rupak Bhattacharya:

New research published in the "Journal of Personnel Psychology" finds that managers facing money issues are more likely to behave controllingly at work, leading to a sometimes abusive management style. Researchers note that employers might help by offering managers confidential financial coaching and financial literacy tools.

[Narrator 2]:

The open season that we have with activists.

Rupak Bhattacharya:

A record 27 CEOs resigned or were forced out last year at mid and large-sized companies targeted by activist investors. That's nearly triple the number in 2020. Experts say CEOs should see 2024's activist activity as a wake up call to be more aggressive in either growing firms or reigning in costs.

[Narrator 3]:

Employee stock option plans.

Rupak Bhattacharya:

A recent report predicts 6% growth in equity compensation in 2025. And experts believe a wider range of workers will be included. It's seen as a way for companies to potentially both create an ownership culture in their workforce and also lower the compensation layout on their balance sheets.

For more insights on business and leadership head to kornferry.com/insights. Now, back to Jill in our episode "Negotiate Your Salary – Better."

[Chris Voss]:

If you go in asking for more salary, how do you expect your employer or your boss to view you? Selfish! What happens when you go in to negotiate a better life for the company, for your boss? Change the game.

Jill Wiltfong:

We're back talking about salary negotiation. And with us now is Dan Kaplan, a Senior Client Partner in Korn Ferry's CHRO Practice. He knows all the ins and outs of how firms determine employee pay and is here to share that really precious perspective. Dan, thanks for joining me.

Dan Kaplan:

My pleasure. Happy to be here.

Jill Wiltfong:

That last clip featured negotiation expert Chris Voss talking about how employees really need to put themselves in the shoes of their organizations. So, Dan, put us in those shoes. How do firm leaders decide how much money managers can give each year in base salaries and raises?

Dan Kaplan:

Yeah, so the decisions are largely formulaic at the top. Usually there's a formula that the board and management uses, and it's based on profitability, firm revenue, which then creates a pool that then has to satisfy all of the organization. From there, the infighting begins, and then each division is fighting for their piece of the pie, usually based on revenue, profitability, headcount. And then it sort of cascades down from there.

Jill Wiltfong:

Okay, and now take me through what's going on inside of manager's head. So, they get their allocation, and then when they sit down for one of these salary conversations, you said it's often one they dread having, why is that?

Dan Kaplan:

First of all, realize that even your manager probably is disappointed with their numbers. There's the old saying that no CEO's ever been happy with their own compensation. People think they're gonna get the moon and the stars and managers never have enough to give out. And then they have to look at their entire organization, take care of their people, take care of their high potentials, take care of their stars, and at some point the money just runs out. And so they know going into these conversations no one will ever be satisfied.

Jill Wiltfong:

So, Dan, knowing that even managers kind of dread these conversations, what's the best mindset and kind of way for you to go into this as an employee?

Dan Kaplan:

Be empathetic. Take some of the pressure off. If you hear your numbers and you're not thrilled before you just jump down your boss's throat, lead in by saying, "I know that this is tough for you. I am sure that you have spent the last two months fighting with management trying to get the right bonus pool. And I'm sure you're having lots of conversations with people who are a little bit disappointed. Now let's talk about my own disappointed." Be human, and again, take some of the sting out so that you can have a conversation among almost peers as opposed to attacking back because you're not satisfied.

[Negotiator – ‘Good Will Hunting’ movie]:

I'm not exactly sure what you mean. We've already offered you a position.

[Ben Affleck as Chuckie – ‘Good Will Hunting’ movie]:

Nobody in this town works without a retainer, guys. You think you can find somebody who does. Let me tell you you have my blessing. But I think we all know that person's not gonna represent you as well as I can.

[Negotiator – ‘Good Will Hunting’ movie]:

Will, our offer is $84,000 a year.

[Ben Affleck as Chuckie – ‘Good Will Hunting’ movie]:

Retainer. Retainer.

Jill Wiltfong:

That's a scene from "Good Will Hunting" where Ben Affleck negotiates for a retainer with a company that is really keen to sign him.

Dan, it seems that some employees in real life might find themselves in a similarly favorable situation this year. You've said that firms with fuller coffers may be engaging in a bit of a comp war. Tell me more about that.

Dan Kaplan:

So winning companies invest in a down market. They invest, you know, they lean into the turn, if you will, to use a racing analogy. And what we are hearing about this year is organizations are starting to be on the offensive. Even if they maybe didn't have a spectacular year, but they have cash reserve, they're gonna take the opportunity to increase the bonus pool. They're gonna try to really get their teams happy, understanding that it's gonna put pressure on their direct competitors. And either it's gonna allow them to recruit talent from their competitors who are coming away from bonuses and disappointed or it's at least gonna put pressure on their competitors.

Jill Wiltfong:

Since you are an HR maven, this is your space, perhaps it's fitting that we end on this. You've mentioned that when a pay raise doesn't materialize or falls below expectations, bringing HR into the loop can be useful. How so? And how should people go about doing that?

Dan Kaplan:

For sure, so when HR functions at the right level, they are a safe space for employees. And so while it will hurt you in the long term to go to your boss's boss and to play that game. It's a sideways move going to HR and saying, "Here's my performance. Here's how I think I performed this year. I'd like better consideration." It might be a little bit of cold water in the face when they say, well actually, your performance isn't quite what it was, what you think it was. Or they can then be either a sounding board to help you position to go back to your manager and position it differently, or potentially they even have the conversation internally. And that's seen as a legitimate way of operating, not going out of bounds going to your boss's boss.

Jill Wiltfong:

Very good. Dan, really wonderful to have your candor and your insight as always. Thank you for being here.

Dan Kaplan:

Absolutely. My pleasure.

Jill Wiltfong:

The Executive Producer of "Briefings" is Jonathan Dahl. Today's episode was produced by Rupak Bhattacharya, Nadira Putri, and Teresa Allan. And it was edited by Jaron Henrie-McCrea. It contains reporting by Russell Pearlman, Arianne Cohen, and Peter Lauria.

Our video segment contains original artwork by Frazer Milton, Hayley Kennell, Jonathan Pink, and Sasha Kostyuk.

Don't forget to read our magazine, available at newsstands and at kornferry.com/briefings. That's it for Korn Ferry “Briefings”. I'm Jill Wiltfong. See you next time.

Sonal Bahl:

Today's Thursday. I don't know if you noticed.

Jill Wiltfong:

Oh God, I'm going to get a phone call this afternoon.