Four Questions To Ask Yourself Before You Use Any Negotiation Advice
It happened again. Someone posted a video on salary negotiation for women, and they tagged me because I write about the topic. It might be a video saying "it's too risky for women to ask for more" or a video claiming "women must demand more because they're historically underpaid." In either case, and both of these situations have happened to me, people have demanded my reaction. Which piece of advice is true? Inevitably, an argumentative comment thread ensues whether I weigh in or not.
So what's the right answer? Is the backlash real? Should we ask for more?
The real answer is: it depends.
Is it true that women experience a negative backlash when they ask for more money at work? Absolutely, and the research is clear. Hannah Riley Bowles from Harvard University and Linda Babcock from Carnegie Mellon University found in their 2007 study that the negative backlash towards women who ask for more money is measurable and persistent. Women who asked for more were negatively perceived by their managers and considered more demanding. Further investigation in 2016 by Christine Exley from Harvard University, Muriel Niederle from Stanford University and Lise Vesterlund from the University of Pittsburgh found that "women hurt themselves financially when they followed a blanket recommendation to always ask for more." When women decided to opt out of negotiating, they often made a better financial decision for themselves and avoided the backlash. Conversely, when women in the study were forced to negotiate, their wages actually decreased over time.
Should women ask for more compensation to help close the gap in earning potential? Another resounding yes, with a few caveats. It's clear that asking for more in salary negotiation will increase income over a person's lifetime, if you can avoid the backlash. Not negotiating could cost you millions of dollars. But this all hinges on how you handle risk. If you are comfortable with a higher degree of risk, it might make sense to ask for more. Asking for a raise in an annual review has less risk than asking for more pay in a job interview. In either case, pay attention to how you anchor -- in other words, what number you offer in the negotiation. If you anchor too far outside of what's financially possible, you risk damaging a new relationship or collapsing a deal. Researchers from Columbia University's Business School have found that using a range offer can increase chances of a higher final value in a manner that communicates politeness. These researchers also note that having a range of more than 25% of your lowest offer doesn't improve outcomes, so be sure to keep the range at a level that won't collapse the deal.
How can these two seemingly divergent points both be true? The trick is to figure out how to avoid the backlash and still maximize outcomes for yourself. What might make the most strategic sense in one place might only be useful in another if you can gauge the situation correctly and apply tactics appropriately. One way to check the alignment of advice to your situation is to consider these four questions:
- What personalities are in play in the negotiation?
- How do you handle risk?
- What kind of relationships are at stake?
- What is the larger context of the negotiation?
Let's break each question down further.
What personalities are in play? Spend time thinking about how a suggested negotiating strategy or tactic might interact with your personality and that of your negotiating partner. If you're introverted, using open-ended questions paired with deep active listening might be a great way to figure out how to build a deal. If you're extroverted, it might make more sense to figure out how best to sell the benefits of your offer. Consider as well how a tactic might be received by the person you're negotiating with. The key thing to determine is whether the suggested strategy or tactic aligns with who you truly are.
How do you handle risk? Not everyone enjoys risk or the unknown, just like not everyone prefers to "play is safe." This question can help you explore how you find yourself making decisions, and reflect on whether you minimize or maximize risk. If you have a mortgage and dependent family members, you're probably going to make decisions differently than a single person who rents. It's critical to distance yourself from other people's opinions and get clear on how you feel about risk.
What kind of relationships is at stake? Is the negotiation a short or long term relationship? If it's a job negotiation, you are starting out a new relationship and are simultaneously creating a first impression of yourself. There isn't a lot of history or trust because you're just getting to know each other. If it's an annual review, the relationships might include a deeper context and increased trust and investment that could sustain the higher risk associated with asking for a raise.
What is the larger context of the negotiation? Perspective is key! What are the customs, culture and standards of the industry you're operating in? What is considered reasonable by the professional community you're a part of? What's considered ambitious? And what's considered simply out of reach?
When it comes to negotiation advice, there will never be a one-size-fits-all solution. It's just not the nature of negotiation. But by taking a step back and considering the four questions mentioned above, a more strategic picture of possibilities may emerge, guiding you to winning solutions.
This article originally ran in Tanya's Forbes column, and you can read the original by clicking here.