11 ms·

The suggestion to not give a number first is awful. You may not want to give your previous salary history, but you most certainly do want to give the first numb

by jwegan 15y ago

The suggestion to not give a number first is awful. You may not want to give your previous salary history, but you most certainly do want to give the first number. You should do your research and figure out what the company usually pays for someone of your experience (checkout glassdoor.com or ask around) and state a number that is on the very high end of reasonable. It is always easier to try and stand your ground than fight your way uphill from a low offer. The only case you might not want to state the first number is if you can't find our what the company typically pays.

VMG 15y ago
Scientific research agrees with you. The concept is called anchoring Anchoring research helps clarify the question of whether to make the first offer in a negotiation: by making the first offer, you will anchor the negotiation in your favor. In fact, Mussweiler and I have shown that making the first offer affords a bargaining advantage. In our studies, we found that the final outcome of a negotiation is affected by whether the buyer or the seller makes the first offer. Specifically, when a seller makes the first offer, the final settlement price tends to be higher than when the buyer makes the first offer. http://hbswk.hbs.edu/archive/4302.html http://hbswk.hbs.edu/archive/4302.html http://en.wikipedia.org/wiki/Anchoring http://en.wikipedia.org/wiki/Anchoring The whole article could use a lot more science. I suggest reading "59 Seconds" from Richard Wiseman.
- deleted 15y ago
  [deleted]
- damoncali 15y ago
  I was under the impression that putting out the first number anchors the negotiation around that number, not necessarily in one's favor. For example, if you think you want to earn 100k, and they were hoping to keep you under 125k, throwing out a number of $110k is not giving you the advantage, as they may have thrown out a first number of $115k if you had let them.
  - kevinh 15y ago
    This is more reason to research the company's salaries up front. If they were planning to lowball you and you put out a high number, it may help you, but if you don't know anything about the company, it may be more beneficial to let them make the first move (unless you have multiple options open and are willing to say a high number).
    - vaksel 15y ago
      the problem is that salaries aren't uniform for all companies. so if you go by glassdoor, you'll see that some engineers make $40K/yr, while others make $150K/yr in the same area. If you go by listed salaries on job descriptoins, once again on monster.com you might see jobs posted at $100-150K/yr...while others, for pretty much the same exact requirement list/job description you'll see $50K The good thing though, is that if you ask for more than they can afford, they'll almost always tell you their real number. So just ask for 1/3 more, i.e. if you want 90K, ask for $120K, then watch them come up with a 100-110K counter offer....and who knows, you might just get that $120K
  - timbre 15y ago
    In fact VMG's HBS link, which generally encourages making the first offer, includes this caveat: > There is one situation in which making the first offer is not to your advantage: when the other side has much more information than you do about the item to be negotiated or about the relevant market or industry. For example, recruiters and employers typically have more information than job candidates do... If I can get to the point where I understand the market as well or better than the potential hirer, I'll try to make an anchoring first offer. Usually I can't.
    - VMG 15y ago
      If that is the case, you shouldn't accept any offer at all - how would you know that you are being fooled?
      - itsameta4 15y ago
- khafra 15y ago
  Considering that anchoring works with completely unrelated numbers, I wonder how well it would work to ask the population of Tallahassee, or the distance in miles to the moon, right before you start talking dollars.
  - lutorm 15y ago
    Or ask about last quarter's gross profit... ;-)
badclient 15y ago
I was voted as the most ruthless negotiator in class because as soon as the negotiation began, I rushed to anchor the most extreme position. The rest of the negotiation was how I might budge a little bit. In all but one case, the party budged and I got a super awesome deal--and the points. In one situation, the party didn't budge and neither of us earned any points. It all really boils down to options and what is at stake. In my class negotiation, I literally had nothing at stake(the grade wasn't tied to winning negotiations). In real life though, if you don't have options and you only have one offer and you are pretty sure you won't get any more, this is harder to execute. On the other hand, if you don't have a lot to lose, you can be somewhat irrational. Note, you are not giving your current salary number, just what you expect. If it is way overboard, the company should still make you an offer if they like you. From then on, it is up to you: if you have a better option, go with it; if you don't, emphasize that you are willing to find some middle ground because you dig something unique about the company. You can say how you understand they can't pay what you'd like but because you are excited about industry x and enjoyed the culture, you'd consider middle ground figure of _____. Final caveat: There is such as thing getting TOO good of a deal ... and then getting fired soon after because you couldn't deliver on the expectations you set relative to your salary.
mechanical_fish 15y ago
This is only good advice if: a) You really know what you're worth to the person across the table. (In a crazy-hot market, it's hard to get a good handle on this. And if you're mentally constrained by your current salary, negotiated in a down market when you had no experience, it's hard to break free of that. It's also hard to evaluate your own skills as others see them...) b) You are completely comfortable with asking for, say, 1.5x what you're worth with a straight face; c) when the person across the table visibly flinches or chuckles or hedges - and they will; books on negotiation explicitly teach you to do this - keeping that straight face and defending the number you just asked for. So I incline to the opinion that patio11 is giving the right advice for his audience: The kind of people who secretly think of themselves as vastly overpaid and are secretly ashamed of it. I know from painful experience that if you send me into a room and ask me to anchor my own price my natural-born tendency is to tie that anchor around my own foot and then throw it into the Atlantic Ocean.
- alexsb92 15y ago
  Do you have any examples of some good books on negotiations?
  - simonsarris 15y ago
    I've read a few. Negotiation Genius is probably the most accessible one: http://www.amazon.com/Negotiation-Genius-Obstacles-Brilliant-Bargaining/dp/055380488X http://www.amazon.com/Negotiation-Genius-Obstacles-Brilliant... Winning Through Intimidation was a fun read, especially if you're into real estate. Apparently the book is worth a lot now (I had no idea, I have an old hardcover version that I don't even see here) http://www.amazon.com/Winning-Through-Intimidation-Robert-Ringer/dp/0449207862/ref=sr_1_1?s=books&ie=UTF8&qid=1327345515&sr=1-1 http://www.amazon.com/Winning-Through-Intimidation-Robert-Ri...
  - peterb 15y ago
    "Getting to Yes" by Fisher, et al. and "Bargaining for Advantage" by Shell are considered classics in the field.
run4yourlives 15y ago
If you do give the first number - in any negotiation - and you don't count that as a point for the other side, you are probably a horrible negotiator. This might not mean much to you overall, but don't confuse it with strong negotiation skills.

by jwegan 15y ago

VMG 15y ago

Scientific research agrees with you. The concept is called anchoring Anchoring research helps clarify the question of whether to make the first offer in a negotiation: by making the first offer, you will anchor the negotiation in your favor. In fact, Mussweiler and I have shown that making the first offer affords a bargaining advantage. In our studies, we found that the final outcome of a negotiation is affected by whether the buyer or the seller makes the first offer. Specifically, when a seller makes the first offer, the final settlement price tends to be higher than when the buyer makes the first offer. http://hbswk.hbs.edu/archive/4302.html http://hbswk.hbs.edu/archive/4302.html http://en.wikipedia.org/wiki/Anchoring http://en.wikipedia.org/wiki/Anchoring The whole article could use a lot more science. I suggest reading "59 Seconds" from Richard Wiseman.

deleted 15y ago
[deleted]
damoncali 15y ago
I was under the impression that putting out the first number anchors the negotiation around that number, not necessarily in one's favor. For example, if you think you want to earn 100k, and they were hoping to keep you under 125k, throwing out a number of $110k is not giving you the advantage, as they may have thrown out a first number of $115k if you had let them.
- kevinh 15y ago
  This is more reason to research the company's salaries up front. If they were planning to lowball you and you put out a high number, it may help you, but if you don't know anything about the company, it may be more beneficial to let them make the first move (unless you have multiple options open and are willing to say a high number).
  - vaksel 15y ago
    the problem is that salaries aren't uniform for all companies. so if you go by glassdoor, you'll see that some engineers make $40K/yr, while others make $150K/yr in the same area. If you go by listed salaries on job descriptoins, once again on monster.com you might see jobs posted at $100-150K/yr...while others, for pretty much the same exact requirement list/job description you'll see $50K The good thing though, is that if you ask for more than they can afford, they'll almost always tell you their real number. So just ask for 1/3 more, i.e. if you want 90K, ask for $120K, then watch them come up with a 100-110K counter offer....and who knows, you might just get that $120K
- timbre 15y ago
  In fact VMG's HBS link, which generally encourages making the first offer, includes this caveat: > There is one situation in which making the first offer is not to your advantage: when the other side has much more information than you do about the item to be negotiated or about the relevant market or industry. For example, recruiters and employers typically have more information than job candidates do... If I can get to the point where I understand the market as well or better than the potential hirer, I'll try to make an anchoring first offer. Usually I can't.
  - VMG 15y ago
    If that is the case, you shouldn't accept any offer at all - how would you know that you are being fooled?
    - itsameta4 15y ago
khafra 15y ago
Considering that anchoring works with completely unrelated numbers, I wonder how well it would work to ask the population of Tallahassee, or the distance in miles to the moon, right before you start talking dollars.
- lutorm 15y ago
  Or ask about last quarter's gross profit... ;-)

badclient 15y ago

I was voted as the most ruthless negotiator in class because as soon as the negotiation began, I rushed to anchor the most extreme position. The rest of the negotiation was how I might budge a little bit. In all but one case, the party budged and I got a super awesome deal--and the points. In one situation, the party didn't budge and neither of us earned any points. It all really boils down to options and what is at stake. In my class negotiation, I literally had nothing at stake(the grade wasn't tied to winning negotiations). In real life though, if you don't have options and you only have one offer and you are pretty sure you won't get any more, this is harder to execute. On the other hand, if you don't have a lot to lose, you can be somewhat irrational. Note, you are not giving your current salary number, just what you expect. If it is way overboard, the company should still make you an offer if they like you. From then on, it is up to you: if you have a better option, go with it; if you don't, emphasize that you are willing to find some middle ground because you dig something unique about the company. You can say how you understand they can't pay what you'd like but because you are excited about industry x and enjoyed the culture, you'd consider middle ground figure of _____. Final caveat: There is such as thing getting TOO good of a deal ... and then getting fired soon after because you couldn't deliver on the expectations you set relative to your salary.

mechanical_fish 15y ago

This is only good advice if: a) You really know what you're worth to the person across the table. (In a crazy-hot market, it's hard to get a good handle on this. And if you're mentally constrained by your current salary, negotiated in a down market when you had no experience, it's hard to break free of that. It's also hard to evaluate your own skills as others see them...) b) You are completely comfortable with asking for, say, 1.5x what you're worth with a straight face; c) when the person across the table visibly flinches or chuckles or hedges - and they will; books on negotiation explicitly teach you to do this - keeping that straight face and defending the number you just asked for. So I incline to the opinion that patio11 is giving the right advice for his audience: The kind of people who secretly think of themselves as vastly overpaid and are secretly ashamed of it. I know from painful experience that if you send me into a room and ask me to anchor my own price my natural-born tendency is to tie that anchor around my own foot and then throw it into the Atlantic Ocean.

alexsb92 15y ago
Do you have any examples of some good books on negotiations?
- simonsarris 15y ago
  I've read a few. Negotiation Genius is probably the most accessible one: http://www.amazon.com/Negotiation-Genius-Obstacles-Brilliant-Bargaining/dp/055380488X http://www.amazon.com/Negotiation-Genius-Obstacles-Brilliant... Winning Through Intimidation was a fun read, especially if you're into real estate. Apparently the book is worth a lot now (I had no idea, I have an old hardcover version that I don't even see here) http://www.amazon.com/Winning-Through-Intimidation-Robert-Ringer/dp/0449207862/ref=sr_1_1?s=books&ie=UTF8&qid=1327345515&sr=1-1 http://www.amazon.com/Winning-Through-Intimidation-Robert-Ri...
- peterb 15y ago
  "Getting to Yes" by Fisher, et al. and "Bargaining for Advantage" by Shell are considered classics in the field.

run4yourlives 15y ago

If you do give the first number - in any negotiation - and you don't count that as a point for the other side, you are probably a horrible negotiator. This might not mean much to you overall, but don't confuse it with strong negotiation skills.