There are two ways to look at salary negotiation: short-term and long-term. While most people focus on the short-term (“How much should I ask for when I start a new job?”), let’s start with the long-term, because this is where most people make mistakes.
LONG-TERM: MAKE BIG JUMPS
“Many female professionals tend to reach their top salary potential in their 40s,” says Stella Tang, managing director of recruitment firm Robert Half Singapore. This is true for everyone with the exception of a tiny percentage of people who are climbing a ladder to the very top, or people who are exceptionally lucky.
This means you should plan very carefully for the window, which starts in your late 20s – the age where you tend to figure out what you want to do with yourself – and ends around 40, which is also the time many women have kids.
Planning for that window means thinking of salary negotiation in terms of things that create big jumps in salary, rather than small percentage points or a couple of thousand dollars here or there. There are three basic ways to get a big jump in salary:
1 Get a mentor
Mentors have an enormous impact on your salary trajectory. In fact, they probably matter more to your career than the company you work for. “There is an upward trend of professionals getting mentors in their careers. When the time comes, mentors can use their experience to advise you how to navigate this area and how much to ask for in a salary negotiation,” says Stella.
2 Get a better title
Your salary never shows up on a resume. It is your title and achievements that are visible, so negotiate for a title that will make your resume show a pattern of increasing responsibility. Another option is a title that will enable you to have a big impact in your organisation, which translates to bullets on your resume.
“You might want to consider the existing organisational structure first and see whether it is appropriate for the title you have in mind,” says Stella. “The last thing you’d want is to sound ‘bigger’ than your boss.”
Next, check out similar positions in the industry and compare them with the title you’re being offered. “Then, demonstrate how having this job title adds value to the organisation and why you deserve it,” Stella adds.
Know too that the better you are at writing your resume, the better you will be at negotiating at each point in your career. This knowledge that should create a foundation for your salary negotiation strategies.
3 Change departments or area of specialty
As a rule, if you are making a profit for the company, you are likely to be paid more. For example, human resources has no profit-and-loss responsibility, so you will always be very limited in your earning power in HR.
If you are in the cost centre to the company, you will be paid less than if you create revenue for the company. Being the best person in the cost centre doesn’t do you any good unless you leverage that standing by moving to a different department – one with profit value for your company. Take a pay cut to do this, because in the long run it will create a better salary trajectory for you.
SHORT-TERM: DO YOUR HOMEWORK
Long-term strategy doesn’t mean taking an insulting sum offered to you in a salary negotiation. So when you’re asked, “What are your salary requirements?”, it really pays to be prepared. Here are three tips:
1 Know the statistics relevant to the salary for your job
“Research the salary ranges for your position in the industry to see whether you are being offered a fair package,” says Stella. “Come prepared to any discussion with valid examples and or documents. Use phrases like ‘Based on my research…’ and ‘According to the latest salary report…’ to back up the salary range you are gunning for.”
Stella says the Robert Half Salary Centre provides up-to-date salary information on the banking and financial services, finance and accounting, and IT sectors. You can download the 2014 Robert Half Salary Guide there .
You can also check STJobs’ Salary Benchmarker Tool to compare your ideal salary with your peers.
But in general, you will need to have a few tricks up your sleeve for using the data. For instance, pay is often linked to title – so you might be able to negotiate the title to one that typically receives more pay. Or you might be able to make the case that you have skills which warrant being paid more because you will be doing work outside the scope of the title.
Don’t forget that your overall salary package consists of more than your pay cheque. “It also includes benefits, vacation and medical leave, as well as alternate work arrangements,” Stella adds.
2 Don’t ever give the first number
The people hiring you have a range they can pay for the job. They want to know how much you want in order to see if they can offer you the low end of the range. If they tell you their range, you’ll ask for the high end. But if you tell them your number, they’ll tell you they can pay a little bit below that. This is why you never benefit from revealing the number first.
3 Understand negotiations
Be aware of the constraints the hiring manager faces. How much leeway is there for making a new title? For changing the level of the position? For increasing base pay? Each company and manager has different constraints.
But the best salary negotiators always give it a try – asking for more never hurts. Think through your rationale for getting more of what you want, but also be prepared to describe how what you want will help the person you are negotiating with. You have the power to make everyone feel good about the resolution.
This article was originally published in Simply Her October 2014.