From D CEO June 2019Subscribe
In her never-ending quest to better understand how negotiations work, Robin Pinkley recently dove into what possesses someone to accept a bad deal. Her team theorized that if you strip everything else away, even just the words “agreement” and “impasse” would impact how we assess our paths forward.
In one version of a survey, you could choose one of two negotiation outcomes, called “option A” and “option B.” Almost everyone chose option B; it represented an “impasse,” but the word never appeared in the description. Respondents elected to avoid option A, an “agreement” (that word didn’t appear, either) that researchers deemed personally disadvantageous.
Another set of respondents were faced with the same exact choices, with one tweak. Now, the options were named “agreement” and “impasse.” Many, many more people chose the unfavorable deal. “In people’s heads, in their hearts, in their souls, implicitly they believe agreement means good—success,” says Pinkley one afternoon, as we talk on a patio in West Village. “Impasse means failure.”
Want to be a great salary negotiator? Pinkley, who runs SMU’s M2M Center for Profitable Negotiation and her own consulting business, advises starting by redefining what that even means. Sometimes it could require walking away from a job you really want.
If you’re struggling to picture yourself doing such a thing, let’s consider the stakes. Pinkley likes to borrow an anecdote from Linda Babcock’s book, Women Don’t Ask. It features Anna and Eric, two hypothetical young professionals taking early-career jobs, hired at the same time, performing the same tasks. Both are offered $80,000, but Anna negotiates and receives less than one percent more—a little short of an extra $500 a year—much less than the average 4 percent to 10 percent companies usually tack on when candidates come back after the initial offer.
Sounds like nothing, but it’s enough that, if both keep getting raises each year until retirement, Eric will have to work an extra—wait for it—nine years to have made the same amount over his career. And because Anna now makes more money, Pinkley says someone up the line could view her as more valuable; then Anna’s raises become larger, because big companies favor simple decisions.
But we’re not just talking about objective value. There is subjective value at stake here, as well. Research shows employers express higher levels of respect for employees who negotiate their salaries, Pinkley says. The trick is how to do it. Pinkley, who co-wrote a 2003 book called Get Paid What You’re Worth, says her research shows companies respect assertiveness in both men and women. But they’re less tolerant than ever of aggressive behavior, particularly from men—a trend she notes could be tied to #metoo.
If by now you’re bemoaning the times you’ve misstepped or failed to negotiate, take a breath. There’s still hope. Consider the plight of Lauren Hasson, who encountered tech’s gender pay gap when she learned a male below her had been raised at 50 percent above her own starting salary in the same job, and negotiated to triple her pay. The experience spurred Hasson toward a new side hustle called DevelopHer, a career development platform geared toward women, with an aim to help people become better negotiators.
Pinkley and Hasson are gung ho about a couple of the same things, such as knowing your concrete numbers walking in. You should have a target and a bottom line, and you should know how you’ll play off any moves the other side makes. You must have done exhaustive research beforehand, and then set your numbers relative to how the industry compensates your skills and experience. Pinkley advocates naming your number first, then making your case—the other side will be looking for reasons to believe you. Hasson says people should always take into account their leverage, whether that’s a lower employee’s higher salary or their standing as the last candidate left in the running. Prepare your talking points ahead of time.
And then, if they won’t meet you at or above your bottom line, you walk. You’ll have to call it an impasse. But you can also call it a success.