Chris Moody is the president and COO of Gnip. These are his thoughts on negotiating compensation with a prospective employee:

When hiring managers are communicating with candidates about salary requirements, there is the old saying that people spend more time planning their vacation than they spend planning their retirement. I’ve found the same concept sometimes applies to job candidates when thinking about their compensation requirements. As the hiring manager, you need to ensure that a candidate has fully considered their compensation needs before you make an offer. Over the years, I’ve refined a simple and effective approach to facilitating this discussion. I’ve used this technique countless times with great results.

The process starts with an email to the candidate:


Complete 10-second survey to read full article!

Chris Moody is the president and COO of Gnip. These are his thoughts on negotiating compensation with a prospective employee:

When hiring managers are communicating with candidates about salary requirements, there is the old saying that people spend more time planning their vacation than they spend planning their retirement. I’ve found the same concept sometimes applies to job candidates when thinking about their compensation requirements. As the hiring manager, you need to ensure that a candidate has fully considered their compensation needs before you make an offer. Over the years, I’ve refined a simple and effective approach to facilitating this discussion. I’ve used this technique countless times with great results.

The process starts with an email to the candidate:

“Dear Candidate,

From a skills and values standpoint, it seems like we are both excited about the possibility of you joining our company. If you agree, the next step in the process from my perspective is to determine if we are aligned from a compensation standpoint. As such, it would be helpful to get the following information from you:

- Current compensation. Please breakout your base salary from any variable compensation if applicable.

- Your view of your current compensation as it relates to your next opportunity. It is particularly helpful if you provide this feedback by selecting from either

a) I believe I’m fairly compensated and would anticipate making the same salary at my next opportunity

b) I’d be willing to take less for the right opportunity

c) I feel I’m currently undervalued and looking for an increase of $X in order to be excited about my next opportunity.

If it works for you, I’d prefer to have this communication via email. Over time I’ve found that putting this stuff in writing helps people think about it more before responding.

Love,

Chris”

Of course there are no right or wrong answers. The goal here is simply to get a clear understanding of how the candidate is thinking about their future compensation by using their current compensation as a frame of reference.  Best case, the candidate’s expectations align with yours and the offer moves forward with a high probability of success. Worst case your expectations don’t align but you now have a thoughtful starting point for negotiations if you still want to move forward with an offer.

A couple of additional points:

1) Even if the candidate has expressed salary requirements during the screening process or during your discussions, I strongly recommend you have this written conversation as the final step before you make an offer. For example, perhaps your conversations along the way changed their perspective on salary requirements for the position.

2) The key to this approach is to do this communication in writing. I know it can seem silly or impersonal, but it makes a huge difference in terms of requiring people to give thoughtful answers instead of answering on the spot.

Before using this approach I had more than a few occasions where candidates indicated verbally that they wanted $X, we offered $X, and then they responded with “I was thinking about it more and I really need $Y to feel good about joining”. Once you hit this situation, it puts both parties in an awkward position and it can be hard to recover. You can avoid this potential pitfall with one simple email.

Comment by Jeff Sherard
Trust is a two-way street and requires a relationship between both parties based on openness, honesty, and transparency. It seems like you are asking the candidate to do all the trusting. You are not willing to fully disclose the company's position. Asking the questions you ask in your email without stating the company's position up front seems unfair. You have a number in mind that you can afford to pay for this position, to maintain parity within the company, to be competitive in the marketplace - share that number. Explain your compensation philosophy to the candidate - are you leading the market in salaries? or just meeting the "going rate"? Do you prefer to compensate wholly with salary? or do you have a mix of salary, bonus, options, performance based compensation? etc.

To just ask the candidate to fully disclose and say "just trust us" seems a little one-sided.
May 2012
Reply from Chris Moody
Jeff, your assumption is that this conversation is the first opportunity to establish trust. My approach is to establish trust throughout the interviewing process by having very open and honest conversations throughout. I encourage candidates to ask hard questions and I will do my best to answer them (see my last post to see the type of questions I encourage candidates to ask during an interview). If someone asks me about salary ranges for the position, I'll give them an answer.

As I mentioned in another comment, I've taken this approach over a hundred times and I've never received any "you go first" push back. I believe the reason is that trust has been established early and consistently reinforced throughout the process.
May 2012
Price: $2.99 Add to Cart
  • Lifetime guarantee
  • 100% refund
  • Free updates