01 Sep Salary Negotiation When Hiring Game Changing Talent
As the economy improves the market for new employees is becoming increasingly competitive. Finding game changing talent takes time and resources, so not blowing it at the offer stage is crucial. However, you also don’t want to hire someone in a salary range that’s either unsustainable or unequitable.
Making an offer is not about winning, it’s a question of balance, making them feel valued and compensated fairly while balancing out the economics. Compensation negotiation needs to be carefully considered, however there’s no shortage of content for job seekers looking to negotiate their future salaries but what about employers.
We’ve seen many of our clients stumble over this part of the hiring process so here are 12 tips for salary negotiation with game changing talent:
1. Ask the candidate what they want …
It seems simple but hiring managers commonly leave this question until the offer stage. Be direct and ask the question early and do not just limit to their base salary. Game changers are typically clear about how much they’re worth, and how much they will accept that’s fair to you, and more than fair to them.
For you this prevents getting too far into a process before you realize that your expectations don’t match up. Don’t be intimidated if the answer they give is higher than you’re prepared to pay. Game changers are prepared to negotiate and as a result may start high with the expectation of compromising.
2. But know what you can pay …
Not only do you need to understand how much you can afford but you need to understand what you should be paying? Review online postings for similar roles including those from your competitors who offer similar services. Both you and any candidate do not want to be surprised or waste time in this process. By conducting solid compensation analysis in advance, you ensure that you calibrate the job requirements properly.
3. And set a range.
For each position you’re hiring for, set an upper and a lower limit that’s reasonable for the position. Consider factors that will influence your offer. More experienced candidates will most likely expect a higher salary than people who are just starting out in their careers. Also, does your candidate have unique experiences, attributes, connections, etc… that are valuable to your business? The upper limit will, of course, ensure you can afford the candidate, but the lower limit ensures the employee receives reasonable compensation and so reduces the risk they leave your role for a “fair salary” elsewhere.
4. Be Careful of Nice-to-haves.
Often the difference between what the candidate is expecting and what you’re willing to pay is due to a misunderstanding of the role and its requirements. Having a clear job description is essential but remember that “nice-to-haves” may result in paying at the upper end of your range.
5. Communicate additional non-monetary compensation …
Times change and so do the needs of employees. Like the base salary, ask the question of what your game changers needs and, just as important, their priorities. Company benefits should be used as a tool in the salary negotiation process. A flexible schedule for example has become more highly valued post pandemic and employees are willing to sacrifice salary if it means they have more time with their family. Allow the candidate to place their own value on perks like unlimited time off, performance bonuses, tuition reimbursement, professional development opportunities or excellent health insurance. There are a lot of non-monetary elements that you could include in a candidate’s total job offer, to take the focus away from dollars and cents.
6. But beware of sign-on bonuses …
Offering a prospective employee a one-time cash payment as a signing bonus can be appealing and will certainly motivate them to accept a job offer. However, this immediate gratification is generally short lived and often more expensive than some of the other longer term benefits you could offer.
7. Instead use self-funded bonuses.
Considering utilizing bonuses or commissions to bridge compensation gaps. These can be structured in a way that allows them to be self-funded through individual or company performance. The frequency of payments can also be negotiated to be quarterly or semi-annually, instead of the typical annual bonus.
8. Making an offer …
Whatever you’re going to offer you want to make sure you’re putting your best foot forward. Don’t offer a game changer $10,000 less than they are currently making just to see if you can get a good deal. You run the risk of them just turning down your offer flat and accepting another position elsewhere, even though you may have matched or exceeded that other offer. Also allow candidates to spend time considering the offer and weighing the pros and cons before giving you a final answer. As an employer, you want to hire candidates who are confident in their decision to join your company at an agreed-upon rate.
9. But expect a counteroffer.
Having said that you may want to not offer the very high end of your range, as it may be necessary to make adjustments based on a possible counteroffer. This is part of the negotiation process so don’t interpret a counteroffer as disrespect or lack of interest. Game chargers want to make sure they feel valued and see a future at your company.
10. Dealing with a counteroffer.
Without giving false hope, be sure to hear out a game changer with an offer in hand. It’s important to keep a clear head and really listen. You obviously don’t want to wait too long before countering with a higher offer, but you don’t want to be impulsive either. Take the time to truly hear the candidate’s needs. Pay close attention to how they’re leaning and be sure to look for ways of accommodating their needs. Sometimes just feeling more “heard” or having greater flexibility is all it takes to tip the scales in your favor.
11. Be direct and transparent and give it time.
Be transparent with your game changer. Once you reach your limit in a negotiation, be clear that you cannot offer any more. This will demonstrate respect and prevents you and the candidate from wasting time trying to negotiate further. If you can’t come to an agreement with an offer within your budget, respectfully set a firm limit that they can either accept or reject.
12. Make peace with your final offer
If you have made your best efforts, offered the most competitive compensation package you can, and remained authentic and honest during the process, then there’s not much more you can do. Leave things on a good note by saying how you’d love to be able to offer more and you can really see how they could benefit the company and how the company can help them grow. Either they’ll accept your offer knowing that it’s the best you can do or they’ll remain positive about the opportunity and seek a relationship in the future.
Need help implementing a winning strategy for hiring game changing talent? The CFO Suite can help. We work with you to define what success looks like for your business and turns that into a compelling story to attract, engage and hire game changing talent.
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