Why it pays to be a good salary negotiator.

Our last blog focused on Salary Negotiation.  Some of the feedback we received from clients who read the blog was that they wanted more practical advice on what to say and when to say it.

 

“Negotiation does not begin until you have a written job offer in hand.  If an offer is not made, you don’t negotiate and you definitely keep your job search active.”

Charles H Logue

 

The time to discuss salary is in the final interview stage.  It’s important to give your employer a chance to get to know you, to see how well you would fit into their company culture and to give yourself a chance to outshine the other applicants. Conversely, why discuss salary until you are really sure that this is the place you want to work?

Keep your cool, don’t be the first to raise the salary issue.  There is an old adage that whoever discusses salary first, generally loses the salary negotiation in the end.

 

Remember that in a salary negotiation, everything is negotiable.  Think of the overall salary package as a long sheet of options.  At the top are your base salary, superannuation, bonus and other monetary items.  Underneath this is a long list of items that you will need to quantify in advance, so that you know the exact dollar value of each.  Work out the value of everything on the list, including shares, parking at your new location, FBT, Novated lease for your partner, health insurance, discounted loans, health club membership, study leave, rostered day off, childcare, study assistance, etc.

 

Remember it’s the take home pay after tax that is the most important.

 

Another item that you may want to add to your negotiation list is annual leave.  It can be very restorative to take a break between finishing your current role and starting your next role.  Perhaps taking 2 weeks off is more important to you than negotiating extra salary.   These upfront negotiations are the time to mention this.

 

Remember that the goal of any negotiation is to achieve a win-win outcome.  You will need to be prepared to compromise some of your negotiation items.  Keep your ideal salary in mind as well as your lowest acceptable figure.  Make sure that all verbal discussions are followed up in writing.

 

Another element to keep in mind in salary negotiation is pace.  Hiring feelings can cool quickly.  Don’t take too long to decide, and make sure you respond to all communications promptly and politely.  Don’t waste your prospective employer’s time.

 

In the event you can’t reach an agreement, conclude your negotiations quickly and make sure you reiterate your enthusiasm for the role.  The hiring manager may find it difficult to find a better candidate than you in which case you could end up being the successful applicant after all.

Salary Negotiation – The Key to Your Successful Transition

A key element of making a successful transition from one role to another is salary negotiation.  But many of our clients tell us that they find the prospect of negotiating their new salary daunting and a source of anxiety.

Being prepared can make a big difference in the way you approach these negotiations with either your current or future employer.

Obviously everyone wants to earn as much as possible for the job they do.  And responsible employers are looking to pay the least they can to encourage you to do a great job for them every day. 

Part of being a good salary negotiator, is knowing up front what you will accept as your ideal salary and what you can live with and your absolute minimum.  You should do these calculations in advance of the discussion.  Make sure you have worked out these three numbers per annum, plus superannuation and other items that are a standard part of the package. 

Depending on the industry you are in and whether you work for a government employer, your salary may be subject to a band or range.  The scope for negotiating may be quite small.  However there are other items you can include in your negotiations that can help to create a better overall package of benefits that keeps you interested and motivated.

Most employers can offer a range of non-monetary benefits that can all add up to form a better overall package to keep you happy.  Items like a mobile phone, company car and laptop are often considered standard inclusions for some occupations.  Other items like on-site parking, insurance, low interest loans, product discounts and medical benefits can help take care of costly regular expenses that would otherwise come out of your after tax salary.  If your new employer really wants you in the role, but simply has no room to move on base salary, consider asking for additional annual leave, flexi time, or study leave to be part of your yearly package.

The key to a successful salary negotiation is preparation.  Treat this discussion seriously, and take the time to do some research.  There are many ways to find out comparable industry rates. Look at online job sites for similar roles. Speak to friends in the industry.  Many recruitment companies have salary calculators on their websites and these can be a great source of information.

When discussing salary negotiations it is never a good idea to mention your personal financial situation or other sources of income that you may have.  This is not relevant to the discussion.  The focus needs to be on negotiating a salary on the basis of what the position merits - it’s market value, not your last salary or what you need to cover your personal expenses.

Once you understand the offer, it’s important to evaluate it carefully.  If you feel the offer is too low, you can state that your expectations were higher and the reasons for this based on your research of salary for similar jobs in the industry and the experience and enthusiasm you bring to the job.

As for any important meeting, if you have done your homework in advance you will feel much more prepared and confident. Remember at the end of any negotiation both parties should be satisfied.

However if there is no way of reaching a mutually agreeable position, it’s in your interest to be polite and prompt in letting the employer know that you won’t be accepting the offer.  After all, they may have other positions available that are more in line with your expectations, so it’s good to exit the negotiation in a friendly and businesslike way.

Easter, Transformation and You.

The Easter message is profound, regardless of your religion or belief system. I certainly cannot lay claim to being a theologian but I see that the core of Easter is a story of transformation, of a metamorphosis from one state to another.  This was not an easy transformation with many hurdles along the way including the insistent doubts from the disciples.

Transformation is not easy

This is a key takeaway from the Easter story. It is difficult to make a transition but the end is always worth it. It reminds me of what Martin Seligman, the father of Positive Psychology, wrote about the difference between a meaningful life and a pleasant life. A meaningful life is not always pleasant – its hard at times, difficult at other times, but fundamentally saturated with purpose and meaning.

When is the right time?

Timing is critical for a transition as the correct choice made at the wrong time is no longer a correct choice. Take retirement for example.  This week the media has been abuzz with the rumour that the Australian Government is considering raising the Australian official retirement age to 67 or even 70.   Finances aside, when should we retire? How do we know when we’ve stayed too long…or leave too early?

So at this time of the year, which is all about transformation, have a think about where you are in your career journey. Don’t dwell on the past and similarly don’t get too hung up on the future.  Try to envisage your preferred career direction and identify how your current role and organisation can help you achieve this.  Set short-term, manageable actions.  Once you have achieved a small step it can be very motivating and a great source of energy to keep you moving towards your preferred career goal.

Happy Easter Everyone.

You’re only as good as the last decision you make.

Are your decisions taking you down the right track? Check out our latest video blog to see what Edwin Trevor Roberts has to say about making decisions at work.

Rewarding without Money

“Little hope for career advancement or growth”  was the second most common reason why people left organisations according to a recent Kelly Global Workforce study. Work is such an integral part of our lives that people need to feel a sense of hope and optimism for the future and think that there are opportunities for them in the future. Great organisations and great leaders innately provide this, however, they are few and far between.

The most common reason for this is a gap that I see is an inability of middle managers – team leaders, service managers, regional managers – to have great career conversations with their staff.  These conversations don’t occur for two simple reasons. First, there is a culture of ‘busyness’ that pervades most industries. Yes, there is always too much to do but what could be more important than retaining and motivating your staff? Second, they lack the skill to have great career conversations coupled with an outdated understanding of what a career actually is.

Let me share an example. The first reaction of managers when they hear ‘career conversations’ is that they need to help everyone develop and be promoted. Yet viewing work as a career is just one perspective on work. Amy Wrzesniewski from the University of Michigan and her colleagues, identified three main perspectives: work as a job; work as a career; and work as a calling. Every organisation needs people who view work as a job as they are critical to getting the work done. They still need conversations, albeit not as frequently, to ensure that they are happy in their role and that their work motivations haven’t shifted.

We call career conversations, magnetic conversations, because it is fundamentally about understanding a person’s underlying motivation and then explicitly connecting this to their work.

Over the past month we have run a series of events focussed on this very topic. Each sparked a vibrant, wide ranging conversation about the nature of work. The consensus was that many organisations have made some progress but there is still a long way to go. And with the economy continuing to be tight, the need to reward without money is greater than ever.

Tapping into the Ageing Population

Mature employees will become more of a feature of all our workplaces over the next decade.  Astute employers are working now to develop a strategy for how to be an employer of choice for mature age workers.  Phased retirement, training for new skills and flexible working practices, these are the buzzwords for mature workers and the way to capitalise on the growing presence of this group in all Australian companies over the next 10 years.

The Australian Bureau of Statistics estimates that 85% of all workforce growth will be supplied by people aged 45 and over by 2012. In Australia we have a double edged sword to deal with, a skills shortage and also an ageing population. 

Mature age workers (45+) have been proven to have lower absentee levels, higher productivity levels throughout the day and also obviously the benefit of longer term career experience (www.deewr.gov.au/experience).  Getting to know the needs of this highly productive group of employees can be your key to staying ahead of the game.

Did you know that mature age workers are as likely to want new challenges and stimulating projects as are your Gen Y employees?  They may place less value on career advancement, but they are looking for job fulfilment and challenges, not an easy ride at work.

“Contrary to popular opinion, the vast majority of older workers are not seeking an easy transition to retirement, with 75% of our survey respondents preferring a challenging and rewarding role.” (Chandler McLeod White Paper, Coming of Age, The impacts of an ageing workforce on Australian business)

Perhaps your younger managers may feel uncomfortable about managing someone older than them.  However, this is a great learning opportunity for the manager and a chance for them to demonstrate level headed and objective management skills.  A skilled manager has the flexibility to work with employees from many different backgrounds and ages.

You could be finding that mature age workers just don’t apply for roles at your company.  Older applicants are less likely to use online job boards and services than younger workers.  This doesn’t mean they won’t have the skills for the job, however, if you’re phrasing your ads to appeal to a younger market, using terms like career opportunities, then you could be missing out on the benefits of hiring mature age workers into your organisation.

With a worldwide trend occurring of employees planning to delay retirement and work longer, it makes good business sense to get better at retaining these workers and keeping them happier for longer. Mature aged workers value training and new challenges at work, to keep them engaged and stimulated.  Having plans in place to facilitate a phased retirement with flexible working practices can be easier and less expensive than making a new hire. 

At Trevor-Roberts we talk to companies every day about workforce planning.  If you would like a confidential discussion about your people strategies for the next five years, call Deborah Wilson, Thought Leader and Client Services Director at Trevor-Roberts.

Better for longer. Beat the retirement boom.

Better for longer. Beat the retirement boom.

Over the next 5 years, the Baby Boomers will hit retirement age.  Did you know that about 25% of Australia’s population are Baby Boomers?  And they’re reaching retirement age fast.   

According to ABS data anywhere between 15% to 18% of the Australian workforce will be retiring over the next few years.

This will create a new set of pressures on Australian businesses.  The skills gap that we are facing over the next 10 years is well documented, and we’re not the only country dealing with this same issue. These experienced and seasoned workers are proven to be one of the most productive and reliable age groups at work.

Mature age workers are an often underestimated goldmine of productivity:

• Mature age workers are less likely to take days off due to illness or to care for others, and are less likely to experience work related injuries than other workers;
• workers aged over 55 are five times less likely to change jobs compared with workers aged 20–24;
• mature workers can deliver an average net benefit of up to $1956 per year to their employer compared to other workers due to high retention rates, lower rates of absenteeism, decreased recruitment costs and greater return on investment;
• experienced workers have built up knowledge and skills during their time in the workforce;
• A study by Australian Health Management which examined the daily work habits of 4000 employees found that workers aged 55 years and over performed at their best for approximately seven hours out of an eight-hour day—an achievement that other workers in the study were unable to match.

(Source: Experience + Make age an advantage: Investing in Experience Toolkit, 2012, www.deewr.gov.au/experience.)

Consider the exponential and untapped value that baby boomers have. Value that is only discovered once they have left and at times this is lost to the business.

So, the issue for your business is, how are you going to attract and retain these workers?  Do you have a strategy? Do you understand the age breakdown of your workforce, and know the retirement plans of these key employees?

Replacing mature age workers, who understand your business, your goals and do a great job for you every day, may be more costly that you realise.

Providing flexible working opportunities, attractive superannuation arrangements and ongoing training are some of the keys to keeping mature age workers in your business longer.

Other strategies to consider are around knowledge management in your business.  Make sure that your intellectual property and customer relationships don’t retire along with some of your most loyal employees.  Having long term “easing out” strategies in place can help to minimise the impact on customers and day to day productivity in your business when long term employees retire.

Deborah Wilson is a Thought Leader at Trevor Roberts.   She works with companies every day on their people strategies.  If you would like advice on career transition, including retirement, career development, leadership development or recruitment advice, call today for a confidential discussion.  p 1300 876 118