Greed Isn't Good
You held out for more than the company wanted to pay.
Now get ready to suffer
the consequences.
Among the "me" generation,
it's fashionable to try to get all you can. This seems
especially true when candidates negotiate new pay packages.
Even when prospects say compensation isn't their first
priority when evaluating job offers - ranking it below
challenge, opportunity, chemistry, and other factors
- pay always seems to rise to the top during the final
discussions.
No one thinks this is unusual.
In fact, articles in respected business publications
cite reasons and ways to hold out for the highest amount
possible from employers. But this approach may be a mistake.
We all want to be paid well, but when considering a career
move, compensation must be kept in perspective and balanced
with other, perhaps more important, considerations and
rewards.
Don't be greedy. Instead,
seek a win-win agreement with a new employer. Not only
does this cement good relations for both parties during
the negotiations, it may save you from the career disaster
that can result from holding out for the maximum. Consider
these reasons:
- You don't want to create
hard feelings.
- If you feel underpaid, you
won't be happy. But if the company feels you're overpaid,
you may be replaced or laid off if your performance isn't
outstanding. Bosses are known to have long memories.
- You don't want to price
yourself out of the market for similar positions. Being
overpaid for your level is dangerous because now you're
locked by golden handcuffs into working for that employer.
This may not be the best company or career opportunity
for you, and you may be miserable, but you won't be able
to leave if you can't afford a serious pay cut. Of course,
you're also the most expendable person if business declines.
- Self-interest isn't attractive
to employers.
Taking the "what's-in-it-for-me?" attitude
won't win respect or loyalty from a prospective employer.
Too much self-interest may create second thoughts about
you and lead to a premature conclusion of interview talks.
Many clients have turned down candidates because they
said "I" too much during an interview, says Dallas search
executive Karen Oney. Consultants from one well-known
international consulting firm make such unrealistic pay
demands on prospective employers that they frequently
lose opportunities that meet their other criteria. "Many,
many people have priced themselves out of contention
quickly by wanting too much of an increase," she says.
Pay ranges dictate expected
experience and performance capabilities. Pushing for
the highest possible amount may put you at the top of
a pay range. It also raises the company's expectations
of your capabilities. This is dangerous because you may
be promising more than you can deliver, which often leads
to failure. Think of employees you knew who were in jobs
that were too much of a stretch for them, if not beyond
their abilities. "This 'raised bar' can set the stage
for the perception of weak results and a higher potential
for failure, slower ascent to ultimate goals, and/or
possible termination," says Jim Winans, former CEO of
a financial services firm in Dallas . One candidate negotiated
an above-market pay package to join a firm which then
went out of business, says Ms. Oney. Another company
hired her and matched her previous pay, even though it
was above the normal range for that job. Now that company
feels her performance hasn't met its expectations.
If a prospective boss
feels you'd be better off starting at a slightly lower
level and being groomed for bigger things, take his or
her suggestion seriously. "If you're able to deliver value
early and often, and excel in the job, you'll build a
much stronger foundation and reputation with the employer
than if you have to struggle," says Mr. Winans. Many
employers must maintain internal pay scale equity. You
may not appreciate pay equity issues when you're hired,
but you will later when an unproven candidate with less
or equal experience asks to be paid more than you. Companies
need to offer competitive pay rates and also earn a profit.
Paying newcomers above what employed producers earn could
cause mass mutiny.
The best job isn't always
the one that pays the most.
Occasionally, employers
must pay above the market because they can't attract
or keep employees. If an offer seems too good to be true,
it probably is. Many of these companies pay so well because
they have retention problems. In fact, search professionals
cherish one well-known, high-paying software company
because its staff is so eager to leave for new opportunities.
A Better Approach
Many candidates who become obsessed with pay issues to
the exclusion of other concerns destroy their chances
of receiving offers, says Eric Hochfelder, a recruiter
in Dallas. "A money focus frequently clouds other critical
career considerations," he says. "We call this 'salary
creep' and it kills quite a few matches made in heaven." When
considering an offer, seek to optimize, not maximize,
compensation. Other career issues are more important
than pay, and when attained, often lead to higher compensation
in the future.
Here's how successful professionals
prioritize job-related variables:
1. The
Career Opportunity
Consider how taking a new position will affect your long-term
career path. What's the next logical step in your plan?
Does this job provide a chance to increase and market
your skills in the future (your ultimate security)?
What's your promotion potential, expected learning
curve, potential for long-term employment (stability)
and possibility of forming mentor relationships at
a new company? Achieving some of these goals is often
a fair trade-off for a lower initial pay package, says
Mr. Hochfelder. "In those cases, the more conservative,
long-term opportunity can far surpass the 'quick-cash'
alternative," he says.
One journalist earned nearly
double her former salary after switching to public relations
but was miserable with her career choice. She willingly
took a pay cut to return to journalism. It took her 10
years for her salary to catch up, but she was much happier.
Ultimately, you must decide what's more important down
the road and whether you can achieve those goals in your
next job.
2. The
Position
Issues to consider include the job's content, challenge
and level of responsibility, the importance and potential
impact of the position/department, potential for success,
variety of the work and the fun you'll have. Does the
role match your skills? What are your prospects for
success? Will you enjoy going to work each day?
3. The
Company and Industry
Consider the size, history and direction of the company
and the industry's probable future. Is the company growing
and in a dynamic industry or field, or are you joining
the best company in a "buggy whip" industry?
4. Lifestyle
Issues
This includes your location, travel schedule, need to balance
work and family, and future stability. Will you be
able to have a life? For many professionals, this issue
is escalating in importance. A Dallas-based consultant
who travels constantly recently says he'd be willing
to accept less than his $95,000 annual salary for a
corporate project management role that wouldn't require
incessant travel. Remember, no one wishes on their
deathbed that they'd spent more time at the office.
5. Intangibles
How do you rate the company's culture, potential fellow
employees, the alignment of its philosophy, values
and ethics with your own and the chemistry you'll have
with supervisors, peers and/or subordinates? Is this
what you want to do? Will you be proud of your work
and colleagues?
6. Compensation
Package
Consider your salary, realistic incentive potential, future
earnings potential, deferred compensation, benefits
and relocation package. Is there growth potential and/or
a strong upside? Is the offer fair and reasonable and
will both parties feel like winners? Some candidates
report that colleagues just received 50% to 100% pay
increases to accept new positions. Don't be swayed
by these stories. For all you know, your colleagues
made poor short-term decisions they'll regret later.
Base your career moves on what's right for you and
what you can live with.
If money is more important
to you than anything else, consider a sales career -
or something illegal. Otherwise, use good judgment. Taking
a new job should make career and economic sense, in that
order. Decide what's right for you by prioritizing these
and other factors. No job is perfect, so allow for give
and take. Determine your best possible career step, adopt
a win/win attitude during negotiations and do a great
job once you start. Do the right things well and good
things will happen.
