How to Negotiate Your Job Offer - Prof. Deepak Malhotra (Harvard Business School)

debach maholtra is a professor in the negotiations organizations and markets unit at the Harvard Business School he teaches negotiation in the MBA program and in a wide variety of executive programs including the owner president Management program changing the game and families and business epac has won numerous awards for his teaching including the HPS faculty award by Harvard Business school's MBA class of 2011 and the Charles M Williams award from the Harvard Business School in both 2011 and 2012 the MBA students selected do talk to give the best of EC Year Speech to graduating students so

without further Ado Professor M thank you good afternoon how are we doing all right uh a couple of uh quick points before we jump into the topic I'm wearing a mic and the reason is uh the session apparently is going to be videotaped and uh I'm not sure yet whether it will actually show up anywhere but the few things that I do know is that uh the folks that are videotaping are under strict orders not to videotape any of you uh and the reason I mentioned that is because a lot of what we're going to

do is going to be some Q&A and at that point whatever question you have you should feel comfortable asking and I will try to address literally any question you may have the only thing I'll ask on the questions is to the extent possible uh make it a generalizable question uh make it a question that may be relevant to people that are you know greater than one in this room and so whether your even if your question comes from a specific area if you can put it in a way that's a little bit more useful to

everybody that would be great I'm going to do this in a slightly different way than I've done in the past uh I've held a session like this occasionally on my own occasionally with a colleague of mine Max baserman for the last few years and we typically launch into Q&A about five minutes into the session uh this time I decided to do it a little bit differently I'm going to start out with about 15 pieces of advice that are preset uh based on the kinds of questions I've heard often in sessions like this uh in one-on-one

conversations with my students or other folks the kinds of things that you may run into and so as we go through those 15 my my guess is that some of those are going to be obvious to you or intuitive to you some of those may not be relevant to you but my guess is also that there may be one or two things uh in that list of 15 that everyone looks at and says oh you know that's kind of interesting I hadn't quite thought about or that's actually quite relevant to what I'm doing and the

one thing that's most relevant to you may be different from the one thing that's most relevant to you but I'll go through all of these because in the past they've been relevant to at least some people in each room so we'll do that and then we'll go into Q&A uh the only other thing I'll say is uh a lot of the action that happens in the job market uh season isn't necessarily at the table it's not when you're sitting across the table from the person you're negotiating with it's a lot of the stuff that happens

before or after and some of the points I'm going to touch on are going to are going to hit those but there may be additional questions that are relevant to you in that domain uh if you're standing uncomfortably feel free to just filter into the sides there's more s sitting area at least on the steps um if you're comfortable standing that's great uh if not then please move around there's a couple seats in the middle here as well if somebody wants to to sneak in all right so uh I'm going to go through a few

things that I think uh may be relevant to you uh feel free to take whatever notes uh feel free to ask questions during if something is unclear uh I'll try to go through this relatively quick so 15 pieces of advice uh the first thing uh I'm going to tell you is uh here's the equation for getting what you want uh this is you know just cutting to the chase uh you want to get more uh you want more money a better offer a better deal here are the components of what you need to do uh

first uh they need to like you all right so that's the first component so the things that you do that make them like you less make it less likely that you're going to get what you want all right that's not enough they have to believe that you deserve it it's not enough that you believe you deserve it uh it has to be believable justifiable to them another version of this is don't ever ask for something without giving the explanation for why you think you deserve it why it's justifiable why it's a legitimate thing to ask

for I'm going to pause here because even these two elements of the equation often end up conflicting with each other occasionally people will tell me here's what I'm planning to tell them and a lot of what they're doing is element two explaining why they're so good explaining how many other people are interested in them explaining why they're the best MBA student and how although you've never hired an HBS MBA student before I'm really going to bring a lot of value but the way you're going about targeting number two is making them like you less all

right so you need to make sure you're balancing these two they need to want to do it for you uh because they like you and they need to be able to want to do it for you because it makes sense to do it for you all right next they need to be able to justify and act on it internally they may like you they may think you deserve it but if they have constraints that you haven't fully acknowledged or understood you're still not going to get what you want and different organizations different people have different

constraints so you want to spend a lot of time figuring out where they're flexible where they're not flexible some of you will run into this when you're going towards a non-traditional job versus a more traditional job for HBS graduates on the one hand many non-traditional jobs uh are likely to offer lower salaries uh if they haven't hired a HBS MBA or any MBA before uh and they're not used to these levels on the one hand they may start out offering less and may end up offering Less on the other hand they may have much more

flexibility on structuring a more creative deal a more interesting deal a more valuable deal for you than the standard folks that hire at HBS so understand where they can give all right and how they're going to justify it internally the person person at the table needs to like you and think you deserve it they need to be able to go back and be able to sell it internally if they're hiring 20 other people from your school or from similar schools they maybe can't just give one of you a certain kind of a sweetheart deal no

matter how much they like you all right uh next uh you need to be to the extent possible flexible on which currency they pay you in you shouldn't care about salary you shouldn't care about uh you know your bonus you shouldn't care about your options you should care about which city you're in you shouldn't care about any one of those things what you should care about is the value of the entire deal to you and the more ways in which you give them to pay you the more likely it is that you'll get paid so

it sort of uh is is a corollary to the the point before it which is you know they they may have constraints in some areas and not in others they may be able to justify certain kind of movements but not others they may have strong precedent concerns in some areas but not others understand those and give them the flexibility in rewarding you in many different ways including maybe not rewarding you today but rewarding you later on maybe you can set up a process by which you're not getting anything special today but you're going to get

something as you go forward so think a little bit more holistically in that way and you add all those up and you get a smiley face I know it's kind of small uh but uh you know most of the things you're going to negotiate will be small relative to bigger things in life so uh but you get your smiley face as I was walking over here uh I did think about there is one other thing which sometimes maybe doesn't fully fit into to this equation but is important to keep in mind and maybe this will

come up on another Point as well they also need to believe that they can get you all right nobody's going to go fight for you go to bat for you expend political or social capital internally for you if they think at the end of the day they're going to go all out for you and you're going to say thanks but no thanks nobody wants to be the stalking horse for the other job that you really really want and that's understandable you're going to be asking people to go out of their way if you're asking them

to change what they originally gave you so you need to be able to deal with that concern as well again these things sometimes are intention with one another there's a little bit of a contradiction here they maybe the way you get them to like you most maybe the way you get them to really want you is by explaining to them that everybody wants you but the more strongly you play that hand the more they may think well we're not going to get them anyway we're not going to get her anyway she's too in demand so

you have there's going to be some Judgment at the end of the day there's going to be some tension it's not very easy to just add them all up but these are the things you want want to be doing all right so that's that's the first uh big Point uh number two don't negotiate just to negotiate uh this is especially important if you are taking a negotiations class while at Harvard Business School you take a class on negotiation you feel like well I took the class I need to to justify having taking it so I

need to go out and and show something for it uh it's not the way to go about it there's many more important areas in your life where what you learn in a negotiation class or at a business school are more usefully applied than in your first job with your first boss just trying to prove that you can get something all right so if something is important to you absolutely if you truly think you deserve something more or something different absolutely think about the interests that are really important to you but don't haggle or negotiate over

every little thing you don't want to you know fight fight fight in order to get a little bit more in order to feel like all right I got something and then have a lot of negative consequences down the line all right so don't negotiate just to negotiate but if it's important if it seems relevant if it's justifiable by all means okay uh this is perhaps the most important thing uh well it's probably the second third most important thing I'm going to say in these 15 but it's it's the most important thing uh for negotiations as

you start out uh people often have the sense that negotiation is about walking into the room walking up to the negotiation table and convincing the other party about X Y or Z about influencing them about persuading them about getting them to move in the direction you want them to move that plays a part but nothing is fundamentally more important than understanding the person on the other side of the table from you who are they what do they like what are their interests what are their constraints learn as much as you can not just at the

table before you get there and after you leave you shouldn't be negotiating with a company or even interviewing with a company without exhausting all sources of information that you can before even walking in talking to folks in the career and professional development department talking to friends who have either interviewed there or have worked there or are planning on working there talking to folks that are in that organization who you may be able to have access to learn as much as you can not just in order to have a good interview all right so I can

say the right words I can hit all the the key things I I know their culture but to to fully understand what they're looking for you in terms of the value you'll bring to the table in order to understand where they may or may not be flexible in order to understand why they're interested in you specifically the more you get uh the better you're going to be as you start negotiating down the line okay next uh negotiate multiple issues or interests simultaneously um here's what that means you get an offer and uh there's two or

three or four or five things you don't like about it so you decide to let them know that you want a different offer what's not a good idea is to send an email that says you know the salary is kind of low could you do something about it and then they work at it and they come back to you and then you say okay and there's these two other things that I'd like you to work on and then they do those and then you come back okay just one more thing all right uh you can

imagine why that's really annoying all right it's also not very productive again they're going to go to bat for you if you ask them to do ABC d and e what's often implied is if I do ABCD and E we can get you if all you do is send them a request for a salary or a change in city and that's the only thing you mention and they start working hard towards it they're not going to be particularly in a giving mood when you go to the next stage the the other reason to do this

or the other way to do this when you mention the two three four or five things that you think need addressing and hopefully it's not as many as five or six things but the few things that you need it's also important to signal to them what is most important and what is less important and the reason is this if you talk about salary and start date and and uh you know your bonus and and your stock options or the city you're going to be in and you mention four or five things you don't tell them

what's most important they may pick two things that are pretty easy to give you and they give those to you and now they feel that they've met you halfway and you feel like they gave you something not very important so if there's one or two really important pieces of uh of interest for you you want to signal that to them you know these are really important uh I'm a little bit more flexible here but if you can do something that's great but I really was hoping we'd get some movement on these all right now again

you want to do it in the appropriate way you don't want to barrage people with you know A List of Demands so you want to limit the demands anyway perhaps but when you're doing it don't just go into the and one more thing and one more thing and one more thing if you have legitimate concerns or interests present them uh together there are occasions where these rules are not appropriate so there's again some judgment but this is in general how you want to be thinking about it so I I'll always leave a little bit of

an exit there remember that what is not negotiable today may be negotiable tomorrow this comes in a few different forms one I alluded to earlier maybe there's not much uh movement to today because they're hiring 20 people just like you and it's hard for them to differentiate the 20 of you every one of you thinks you're better than the other 19 uh and in their experience it's hard to tell which one's better all right and they definitely don't want to play play the game of annoying some people in order to make some people happy but

it may be possible to negotiate those so same issues six months down the line or a year down the line once a number of things have changed maybe you've had the opportunity to convince them that you are different better more unique or maybe simply they're in a different phase in the employment so they just happen to have more flexibility they can do a lot more things once you're one of them than they can do when you're just shopping around so that's one version of what may not be negotiable today may be negotiable Tomorrow there's another

version of it what may not be negotiable on day one during the job interview process may be negotiable on day 30 for example they make you an offer and they have a deadline we need to know by November 15th or November 20th or December 4th and you ask them is there any way I can get more time the answer may be no it may be yes the answer may be no okay well that doesn't mean that it's no forever when somebody says no in a negotiation what they're saying is no today no in parenthesis the

way I see the world today but that same person as you get closer to November 15th or November 20th or December 5th May suddenly have the ability to do things they didn't have the ability to do before so you want to maybe continue that conversation not in the annoying way of calling them up every day and saying how about now what about now I know you said yesterday but it's a new day you know Hope Springs Eternal not one of those but if they've mentioned to you listen you know we we can't change the deadline

uh you know we need a certain number of hit rate by November 15th we may need to make sure that our numbers are looking pretty good we can't just allow people to have a few more months otherwise we can't go to our second list of folks well maybe by November 10th or 12th they've already met their numbers maybe they have some more flexibility maybe other things have changed so what may not be negotiable today may be negotiable tomorrow and in a reasonable understanding way you can Broach conversations again you're only going to do that if

when they said no the first time you asked them uh and can you help me understand why that's hard to do now you're in a better position to know well what might change those facts on the ground so that goes back to the learning mindset number three they say no you can say okay but you can also say okay I understand that may be difficult to do can you help me understand why that is well that's interesting in the past I've seen that some companies are able to do it and other companies are not can

you help me understand under what situations you can and can't have you ever made that kind of a change all right has there been any experience uh in the last few years or this year where you have managed to allow people to to agree later so explore understand figure out exactly what's going going on on their end uh this leads into the next point which is uh stay at the table it's just a mentality stay at the table don't negotiate and then you're out of there and then there's no communication stay at the table stay

in touch you never know when you're going to learn more you never know when they can give you more information you never know when their constraints change when their interests change stay involved all right don't just check the box got that offer all right now let's move on to the next one all right stay at the table staying engage get more information often what they couldn't share with you before they gave you the offer they may be able to share after they gave you the offer what they couldn't share after they gave you the offer

they may be able to share with you once you've accepted the offer maybe what they can't share with you after you accepted the offer they can share with you once you've been working with them six months or a year so stay at the table don't just negotiate when it's time to negotiate because hey we need to reach a deal on something stay at the table with them learn as much as you can as important as it is to come up with a good list of questions that you can ask them and learn as much as

you can about where they're coming from there's going to be times when the other side uh throws something at you that you were kind of hoping wouldn't be brought up all right and the only real solution is to be prepared for those tough questions and it is frankly quite surprising how often people walk into negotiations hoping they don't bring that up rather than spending a good amount of time thinking about when they bring that up what's the best way to respond all right this could be them asking you do you have any other job offers

or the company you worked with over the summer did they make you an offer and if the answer is no you're kind of hoping they don't ask but that's not good enough well what are you going to say and if you're unprepared the most likely thing that's going to happen is you're going to come up with something that either sounds like a lie uh or is a lie uh or is uh too defensive uh or looks like you're just trying to avoid the question all of those are bad in most cases if the question is

you know do you have any other job offers and the answer is no a confident no is not a problem you're not the first candidate they've ever worked with their only reason to hire you is not that somebody else is making you an offer though I know there's some Industries where that plays a much bigger role than others prepare in advance to answer the toughest question yes go with a game plan all right here's what I need to learn from them here's what I need to ask here's what I'm going to ask them to improve

here all of those things are great but think about if you're them what are the things they could that would put you in a slightly more defensive position and you know brainstorm with your friends talk to other folks say you know how should I respond to this in a way that I can do truthfully and convey the information they need and yet not look like I'm a bad candidate all right uh there's a a quotation I I shared this with my students uh early on in the course I'll mention it here uh the story as

I hear it go goes as follows uh how many of you know who Mike Tyson is Mike Tyson okay everybody seems to know okay uh Mike Tyson uh is a boxer was a boxer a rather aggressive boxer had a lot of problems um not particularly the nicest guy you're ever going to run into in the ring or outside of the Ring perhaps uh but he was very successful and at some point he was asked uh The Story Goes um you know how do you manage to continue to be successful when you have to know that

everybody who walks into the ring to fight you has prepared specifically to fight you you know they've watched your videos they've read up on you they've looked at every little piece uh of every little fight that you've had they're coming in specifically with a game plan designed to deal with you so how how do you deal with that how do you deal with that and Mike Tyson uh allegedly said well everybody has a plan until they get punched in the face and then the plan unravels and that is generally true in negotiations and it's true

in job negotiations you have a script you have these great ideas you already know you deserve it now you've even come up with the language to you know tell them why you deserve it you're a likable person you have a list of questions you have all these Alternatives that you're going to throw out and sprinkle at the right time you got it and then they come up and and come at you with an angle that you were either hoping they wouldn't say or you hadn't expected so think about what they might be interested in finding

out from you and how you might deal with those things all right okay um when they ask you questions that you wish they hadn't asked questions like well if we make you an offer tomorrow will you say yes and you don't like that question because you would like to not have committed to an offer before you've seen it much less negotiated with other people to get other jobs don't get stuck on what they're asking you try and figure out why they're asking you that is it because they want to make sure that you can't negotiate

and they're going to put you in a corner and get you to say yes and then once they make the offer you're stuck usually that's not it why are they wanting to know what's going on on their side did they just say it that way because they're not very good communicators and they're just kind of interested in finding out are you excited about this job maybe that's all they want to know maybe they actually have some deadline by which they need to have a yes or no well that's that's different maybe this person really doesn't

buy that you're interested in them all right so where is it coming from they ask you a tough question or even not a tough question before you launch into an answer that targets what they asked figure out what world you're in what is their intent where are they going with this maybe the answer to the question doesn't even give them what they really need and at the same times puts you in a in a difficult position step back can you help me understand where you're going with this oh that's interesting well you know if the

question is you know how excited am I about this job well that's easy dot dot dot what do you need to know you don't have to say yes or no uh and you don't have to say yes or you don't have to avoid saying yes or no and look like you're avoiding the question if you engage in a real General uh genuine conversation about what it is that they're after so what they're asking is important but nowhere near as important as why they're asking it Target the why uh to the extent possible uh avoid ignore

downplay uh ultimatums of any kind in both directions don't say things that sound like ultimatums uh don't say ultimatums so so not just things that sound like don't don't make ultimatums don't make them feel like you're making ultimatums is that a question oh sorry uh you know yeah let me finish the ultimatum then we'll go right back to your question that's a perfectly fine thing to do uh people don't like ultimatums people don't like being told do this or else sometimes we present things that sound like ultimatums even though that's not our real intent we're

just trying to come from a position of strength and it comes off the wrong way but it's equally true in the other direction if somebody says something to you that sounds like an ultimatum like we will never do X or under no circumstances can we move in that direction or that's not possible my personal uh advice my personal approach in those situations is if somebody makes an ultimatum in any negotiation I just ignore it I pretend it was never said and there's a real good reason for this all right it's possible that at some point

they or someone else will discover that the position they took is going to end up in no deal and really they could move if it came down to it the last thing I want them to feel at that point is I made this big deal about this ultimatum and now I'm going to lose face by changing my mind all right it's easy to get people in negotiations to understand that they've said something they shouldn't have said or to they ask for something that you can't possibly give them they've overreached the hard part is getting them

to admit it and change their behavior they'll only admit it and change their behavior if they can do so without looking stupid or silly or losing face if they make an ultimatum we'll never do this we can't do this I don't make them repeat I'm sorry did you say never under no circumstances are you sure no that's irrelevant the most I might say is I can see how that might be a difficult thing for you to do now let's talk about X Y and Z ignore it now if it's a real ultimatum if they really

cannot do it under any circumstances don't worry they'll repeat it over and over again you don't have to make it a thing let them make it a thing if it's important often people will say things in the Heat of the Moment out of frustration because they're busy because they didn't think it through in a way that could trap them and you in the corner and what you don't want to do is fuel that fire just get out of the way of those just move out of the way okay your question sir no no that's okay

there there are no turns going back to the question about trying to discern inent and answer intent are you recommending that we try and keep that in mind as we massively process a question or should we actually ask a question back regarding the questioner intent well you know uh obviously there's no one right answer to every situation that idea which is actually not so different from idea number three up there which is trying to learn as much as you can at every moment uh could happen before they' asked you the question they ask you the

question you're not exactly sure where they're going so you ask for a clarification maybe you start answering it and then realize you know what I've answered it but I'm not exactly sure whether they liked my answer didn't like my answer got what they needed they kind of nodded along well I can ask a clarification now at every point if there's something you don't understand if there's something that's ambiguous if something surprises you your goal should be to investigate all right that's the learning mindset that's the thing you walk into with anytime anybody says anything I

didn't expect or I think is a little bit strange or ambiguous the number one goal is let me figure out what game I'm playing what world am I in and I don't mean game in a sort of you know it's a game US versus them but what kind of situation am I in all right the better I understand the situation I am the more wisely I'll deal with that situation so yes sometimes the clarification is important sometimes it puts you in a situation where it seems like if I don't say yes or no no matter

what it's going to sound like I'm dodging the question there's a there's an example uh uh somebody once wrote a paper on this I thought it is kind of a silly thing to write a whole paper on because it's a very small point but it was a really interesting point how many of you watch uh Star Trek any of you watch Star Trek okay uh I don't really but uh the story comes from uh uh Star Trek the Next Generation and uh who's who's the uh the head guyard or all right anyway so apparently he's

on some alien planet as uh he tends to be and uh you know he's gotten into some trouble and he's being uh he's brought in front of this court and it's sort of a kangaroo court they're going to convict him and they're going to kill him all right that's what it looks like of course he doesn't die that's spoiler alert uh anyway they bring him into this courtroom and he's prepared to make his his defense and his argument but he knows this is kind of silly and at some point uh the judge says to him

now I'm going to ask you a question and if the first word that comes out of your mouth is not yes I'm going to have these people shoot you on the spot and then he says so and the is something like are you guilty of crimes against you know Humanity or something you know and he's like well that's a tough question to have to say yes to and so he says yes provisionally and then he goes on to his long speech about why it's not really a yes all right so the point of course is

that the yes under these conditions yes but yes if we assume this is often a way to deal with situations where people are maybe even unfairly forcing you to take a a big position a big stance on something now that's the whole point you don't need to write a whole paper about it I think but it's it's a really nice Point all right okay uh okay what do we have next uh okay so I've sort of implied this they're not out to get you uh it sometimes seems that way uh but you got to understand

these people like you and they want to continue liking you it's just that you're not the only concern they have in life uh which is bad and good so the bad part is well you know they're not doing everything they possibly could or they're not being as responsive they're not getting back to me in time even though I have other deadlines okay that's bad the good part is the part that they're not out to get you you know they probably don't have any bad intent they have their own issues and concerns and so you can

work with them in in most cases so if they're not being responsive if they're not being sensitive to your deadlines if they're not exactly moving in the direction you want them to move don't assume it's because they don't want to or they don't like you it could be any of those other things it could just be that they're busy it could be that they're having a a hard time with their kids at home you don't know what it is but usually it's not that they're out to get you uh and especially if you're dealing with

your future boss uh they're not out to get you they may have a personality or a style you're not used to which sometimes looks like they don't care about you that may be true it may be that they're really busy but they like you they want to keep you they're trying to hire you and they like you at least as much as you like them all right and the fact is you're also considering other options and so it's kind of normal so don't don't don't get too bogged down about that um keep in mind uh

whoever you're negotiating with companies don't negotiate people negotiate and every person is different and part of that difference comes from the role that they inhabit in the company negotiating with your future boss is very different from negotiating with the HR person they require different tactics different assumptions you can get different information from them at the end of the day it may not be as bad for you if the HR person is slightly annoyed with you it will be very bad for you if your future boss is annoyed with you all right your future boss may

only be hiring you the HR person may be responsible for 10 different people the HR person may be more concerned about precedent your boss may actually be willing to go to bat for you if they can justify it internally so understand the person you're negotiating with what are their interests what are their concerns don't walk away thinking this company doesn't value me because of one person is doing or saying all right think about who in this company values you and why and how you can leverage that value that you're bringing to the table for those

folks in order to have a good negotiation with the different parts of the company all right uh incidentally this sort of goes along don't let one person in a company ruin your view of the company uh of course if that's the person you're going to be working with then you may choose not to work there but even there you know don't don't overinflate what what P one person says or does okay um don't be in a mad rush to get offers uh this is a quick point on this uh in the beginning of the job

market often we're sort of in a rush to try to get at least one job offer hopefully many U but then we get one and then we find out that there's a problem which is we got one very quickly because we rushed it and now they want to know in a week or they want to know in a month or they want to know in two months and really I was kind of hoping to stretch this part of my life out a little bit uh so it's great to interview early it's you know but occasionally

you want to slow down the process don't assume the process should always be sped up sometimes the better process is the slower process you know again there's some judgment calls right you don't want to slow down so much that they lose interest or they hire someone else Etc but don't always be in a rush to get this negotiation done as quickly as possible think about the portfolio of negotiations you're doing again that's a broader point it's not just in job negotiations you can't you can negotiate each deal perfectly well but if you're not thinking through

the portfolio of deals you're negotiating you may end up in a place you don't want to end up all right so you may want to try for example in this case to have those offers come in a little bit more close to each other uh than simply one in October one in December and one in in February the other ones you might want to move sooner these you might want to delay to the extent possible not always possible all right just a couple more to go here uh tell the truth uh I'm not sure how

much more I need to say about this uh because that's the whole point but you know resist the temptation to tell even a small lie uh this is where everything everybody's been trying to hammer into the the course load uh not just in your uh you know leadership and corporate accountability or whatever the course is called uh you know or or the ethics discussions in this class this is what it comes down to this is you know I teach negotiations so this is your first negotiation all right this is the first company you're going to

be working with after your MBA these are the people you're going to be working with the long term even if it was a one-off thing don't get into the habit of just saying whatever needs to be said to get the deal done to make a little bit more money in most cases because they're not really out to get you because what really matters is not what they're asking you but the intent because there's lots more questions you can ask because you can do all those things on the equation in most cases you can tell the

truth smartly and have a good discussion and end up where you want to get that's negotiating yes there will be occasions where you have to choose between well I could tell the truth and I'd probably lose a little bit or I can lie and get it now is the time to get in the habit of never doing that don't lie in any negotiation I know it's it's kind of like a stupid thing to say because you are who you are and and and you may not even have to think about it and it may sound

kind of preachy now which it is uh but it's important so so so don't do it uh next shoot for an 11 out of 10 what do I mean uh occasionally uh in a negotiation class we we'll do a negotiation and and afterwards we'll ask people to rate their negotiation partner on a variety of Dimensions so imagine a dimension like how much you look forward to working with this person in the future when you're negotiating with your future boss or with the company anybody from that company imagine that they're going to go back into their

office a after having the negotiation with you or after reading your email or whatever and they're going to do two things one they're going to either give you or not give you what you asked for but in addition they're going to write down on a scale of 1 to 10 how how much do I look forward to working with this person and you should really be shooting for an 11 at that point you don't want a nine you certainly don't want an eight a seven a six a five or a four any of those you

don't want a nine heck you don't even want a 10 you want even that negotiation to actually make them want to work with you even more than they did before you asked them to give you stuff that's the goal to negotiate in a way openly honestly without empathy with understanding with give and take with due difference to their constraints and what they can't be flexible on so that when they're done even having improved your offer they like you more than they did before because of the way you interacted with them that's the goal more than

before um and finally uh everything I've said is less important when it comes to job negotiations than this point if you're thinking about how happy you're going to be in life how well you negotiate your job offer uh is almost if not completely unimportant what is important is which job you take and what kind of industry you go into what kind of career path you decide to go down those decisions are going to be worth so much more to your ultimate happiness peace of mind Etc than anything else you do at the negotiation table there's

just no denying that all right we know from significant experience research Etc that many of our uh MBA students are not particularly happy a few years out and many of them continue to not be very happy many years following that especially when it comes to the career side of things and you're never going to have as much opportunity and time to reflect and and and options not just opportunities and jobs but options to consider who you really are as you do now some of you will occasionally hopefully you can build that into your life but

this is a pretty good time time to figure out who you are and what you want to do if there's something that you always kind of thought you might want to try if there's a part of you that you haven't been able to really really manifest in in in your career so far get that part right don't again nobody thinks they're following the crowd but at the end of the day there's a crowd and everybody seems to be in it so uh you know you know think about who you are you know I don't think

anybody here thinks they're the average Harvard Business School MBA student and so don't end up behaving like the average Harvard MBA student and so think about who you are what you want to do and if you can pick that correctly and make some tough decisions there now you're going to end up in a pretty good space the point I'm making here is simply the first step matters what you do now matters because usually the second step is just a continuation down the same path we take the first step and then we take the second step

and we take the third step and the more steps we take the harder it is to Pivot to turn around change course etc for a whole host of reasons that should be obvious all right okay I'm going to stop here uh we have still plenty of time and what I'll do is is uh I'll take any questions you may have uh hopefully some of this was useful uh undoubtedly there's other questions that each of you have that are perhaps idiosyncratic but maybe even uh not so idiosyncratic that that I can touch on so if anybody

has any questions what I'll do is I'll take a couple of questions and then I'll just try to hit all of them as as efficiently as I can so if I can just get two or three questions yes ma'am um this this is a really tactical question but like when you're boss or or Hever says how to make often more attractive like what are you supposed to say are you supposed to talk numbers you say like let me get back to you like how long should the timeline be for that conversation just like what do

you actually say in that conversation okay let's get a couple more questions yeah just in relation to that how do you find out information about what is on the table for negotiation that's before you get the job when you're in the job when you okay so so let's let's do the two of these together because they seem to be pretty well related okay uh on the technical side when somebody asks how how can we make this better for you uh it could be that they're asking for at least some answer in the next 15 seconds

uh but I don't know if anybody who would be offended if somebody said uh you know I think that's a great question obviously I've given it some thought but I've learned so much more in during the interview process would you be okay with me coming back to you after I sleep on it a little bit more I mean would you be offended if somebody said that to you no I don't know anybody who would be offended by that so if you don't have a good answer and the honest answer is I need some time then

that's the answer you should give them all right uh if the question is you know uh is this good enough or are there things that we could improve you say well you know I I appreciate the offer it's very nice there are some things that I might want to again if you're prepared you launch into it if not you take your time all right whether you need a day or a week again what's the honest truth what do you need it for right would it be okay if I came back to you a week later

because that gives me the opportunity to talk to some of the other folks that I got to meet today so can we I think I'd be a better person to answer that question after that rather than right now so I think those are all perfectly appropriate don't feel compelled to answer it right away unless of course their intent is they need to write something down well okay so again now uh now what do you ask for in some sense how do you find that out well again uh in general if it's a company that hires

tons of people from uh a school like this well you can probably find out just by talking to other folks uh and you can know that they'll probably be a little bit less flexible on certain issues um it becomes more interesting if they may have some flexibility and talking to the people that are at that company learning about their culture and what they seem to Value uh looking at how long people stay uh all of those things give you some information but at the end of the day there's nothing wrong with asking the person you're

negotiating with listen uh there are certain things that uh I was hoping would be a little bit different uh we discussed this earlier you know the salary is obviously a little bit lower than my other offers than what I was making before uh in addition you know I was kind of hoping to start here two or three or four things can you give me some idea as to where you may have greater or less flexibility right at the end of the day I want to work at a company that not only do I love and

for whom I can create a lot of value but I want to create uh the kind of package that works for both of us and I know what I need maybe overall but I'm flexible on how we get there so can you help me understand what's easier or you know maybe they've already signaled to you for quite a while that they can't be flexible on X fine explore a little bit more uh when is there flexibility on that has there ever been flexibility on that if not where do you tend to be more flexible or

talk to the current employees there did you negotiate your offer did people take to it okay were they okay with that okay and what worked and what didn't work I think people are usually okay uh with that kind of conversation all right got a couple more uh yes sir yeah so um the company I interned with um so by the time I I finished the internship they told me we like you um if you make their mind U we'll be happy to happy um but you know when he's an open offer or aut offer when

what is the best time for to go go back you don't want to go back when you have only like one option and let them know that you have you do not really have any alternatives um that would put you into fation okay uh let me ask you a couple quick questions so uh are there other companies that you think might give you an offer that you would like more than these folks or shoing around okay so you're still shopping around and some of them may beat this or are you shopping around but this is

still your going to be your best you think one we one of the so so you're waiting uh more than any reason because there may actually be some that are even better this I back to them before I up my mind or I go back to them after find out that they the best option okay so so one of the things uh that this gets to is this notion of staying at the table I think you want to stay at the table if you are at all concerned about them having made a verbal offer but

then you know over time that just sort of dissipates they they sort of lose their commitment to it they're already fully looking for other people you may miss the boat if there's any risk of any of that you want to make sure you stay at theable a and at least stay engaged you don't necessarily have to rush if written offer but if every week or every couple of weeks or every month you're talking with your boss from the summer and saying Hey listen I just wanted to update you on how things are going just wanted

to see how things are going over there can you help me understand what the process tends to be for you folks when you have a summer intern learn what their process tends to be when do they need to make hiring decisions don't push them on an offer if you're not in any rush to get one but just make sure there's no chance that you get tossed from the list simply because you didn't seem interested so if there's any risk of that stay at the table learn more about their process make sure they know you're still

interested but don't push them for something in writing unless they say well you know what actually I'm kind of glad you called we had kind of started to think that maybe you're not that interested we're actually in the process of giving offers now oh well glad I called what's the process typically you make offers and then what oh would you be flexible in that oh okay uh what do you need from me etc etc so stay engaged yes sir here and'll take I graduate here at 94 I I didn't expect your talk here today sorry

say again I graduated in 94 you graduated in '94 yes I didn't expect you new conference here today so I just want to hear listen having in the workforce 20 years I think your point number I which one uh number don't rush your offers uhhuh that's that's the best point that's the best one yes session should I put that number one next time or just put it in bold maybe or I'm not trying to challenge you no appreciate that thank uh okay good uh more questions like more questions like that would be welcome uh yes

ma'am I'd like some thoughts on when when to know to walk away or when to know like when do you actually know that like it's over and when should you step back and no to stop sorry when is what over that that you're not getting the job or they're not improving the offer uh well there's some sure signs uh if they're really annoyed at you uh you know stop uh but you know here here's the the general rule and then how you apply it tactically differs so my view is this you never want a negotiation

to end with a no you want it to end in one of two ways either a yes or an explanation as to why not so when somebody says no to me that's okay sometimes they can't do anything I get that uh this may be out of bounds it may not be possible too many constraints no they don't what I want to do is if I get a know I want to at least understand why not once I have an explanation for why they think they can't do it then I can make up my mind as

to okay this is probably not beating uh worth beating my head over all right so if there're if I have no idea why not then maybe the conversation should continue but once they've explained to me why not and there doesn't seem to be much that I can do about it that's great so that's one answer make sure you're not just getting no five times make sure you're getting no once and then four explanations if anything all right and the second piece of it is uh often they'll be signaling to you we really can't do anything

and you'll push back a little bit more and they'll say something like you know you know I thought we kind of made it clear that that's not possible okay well take that as a hint you know if they're having to repeat themselves uh and it's not because you're asking the same question over and over again then then that's maybe another signal but again keep going until you get what you want which may not be the case but at least you understand why they're not giving it to you and then it's perfectly fine to say okay

it's not worth doing right sir uh what is what are the best ways of using an offer to negotiate another offer to negotiate do you kind of just I mean can you say that like oh my other offer is paying me X you should also pay X or what is what are the best way to say uh okay so um as a so it depends so if the other offer is paying you a lot less uh that's probably not the right to do uh so uh listen so in a world where your other offer is

pretty good or more and the other offer and again you may not have any other offers but the other things that you can bring to the table um what you used to make before you started your MBA is a perfectly thing perfectly fine thing to bring up what the average MBA student makes is a perfectly fine thing to bring up what the average person in this job or industry makes is a perfectly fine thing to bring up these are all types of justif ifications for what you want to ask for so yes one good one

is my other offer is offering X whether you have that or not what you're probably going to do is say how can I make a compelling case that I deserve more and you just happen to have picked one of the four or five or six ways in which you can do it and you bring it up depending on whether it's worth bringing up whether it it helps make the case and what's relevant to the people on the other side some people are glad you brought that up because when they go back to their committee and

and they have to say hey we got to give this guy more because you know he's got offers from X Y and Z and at least two of them are significantly higher than what we're paying and it's we could stretch and make it great other people don't even care to know about that they're in a different industry they say I know you're making a lot more there you may still bring it up because you want to push him up a little bit there's no doubt about that but it won't necessarily play the same role so

what you want to think about is what are all the justifications I can make to justify the offer I want to ask for so they're offering me the this I want this what's the story I need to tell them sometimes a part of that is yes I have other offers and they're here but just remember if your other offer is here you may lose them on are we ever going to get this guy so if you're going to bring up that offer it better be followed by and of course I know you can't match at

that level but I did want to suggest to you you know I am willing to give up a fair amount of money to work with the kind of company that you are and the kind of opportunity you give to Folks at this stage in the career but to the extent that you can bridge that Gap a bit it would be pretty useful for me all right so so yes by all means use it don't throw it in their face too hard give it to them as information there any specific gu you would offer to student

that might be sponsored going the negotiating table on what they're going to do next the company has significant financial leverage over over them and their opportunity so what's the question um do does any of this change if you're you don't really have the ability to walk away as easily um as someone who might you know have two or three job offers the ability to go from one to the other yeah you know where you come off on the tradeoffs changes depending on your situation you've given one version of what makes it hard to walk away

all right some people don't walk away because they're too risk averse some people can't walk away because they have young kids five years from now it may be a different reason so yes the principles I think are all still relevant they don't change but the trade-offs you make may change if what they've offered you is this offer plus implicitly $150,000 or $100,000 on on tuition well that's part of the offer they're giving you all right and so it's going to be a judgment call now what I think is if you don't fall into the category

of folks who um you know if you take on that debt you're going to be you know on the street or or or you have young kids to feed or or anything else then then number is still the most relevant piece of advice which is you know do I want to be stuck here for the rest of my life or am I willing to take that hit and do the one thing I really really wanted to do so if anything I would say you end up having to pay more attention to that becomes more Salient

that you're going to have to give up more than your friends will uh on the other hand if they already paid the tuition then you're really no different the last thing I'll say is the framing matters when they've paid for it and you're thinking of it as an additional $100,000 hit or more um it just seems much worse and Dumber to say no to that money than if you'd paid your own way uh through loans uh and yet it's really the same thing at the end of the day so yeah you're off you're you're making

uh you have a job offer forget your sponsored you have a job offer and they threw on you know your loan forgiveness or something well how much do you value that it's just one of the five or six or seven things you value just like you value which city you're going to be in just like you value your Sal and your bonus and the job and the boss and the industry it's just one more thing you value don't overvalue it because sometimes people put that in just a totally different category oh but sponsorship oh but

I'm sort I got my hands tied I'm not like everybody else no you're just like everybody else you just happen to have identified yet one more interest that you have and now weit it appropriately rather than everything else and then 50% of the variance goes to this no it's probably a lot less than that all right yes sir uh what would be advice on Discerning between constraints on on for the other party uh some of the constraints they're putting might be real but some of them might be just posturing and artificial so what would you

advise for us to how to discern the yeah uh lots of judgment here but I'll give you just one piece of advice on this so I find that the kind of the way in which you ask a question has a huge impact on what they share with you even controlling for how much they intend to share with you so they either want to share a lot or not we can't necessarily change that uh in a moment but how we ask can make a difference so when somebody says no we just can't do that questions that

sound like one of the following I'll give you two examples I guess I often ask people imagine a situation where you could do that imagine a world in which that was possible describe that world to me what would have to be different about that world in which you'd be able to do it and then people have to paint that picture for you and it gives you a little bit of better idea about what is causing that constraint all right another possibility a little bit along the lines of what we've already discussed is can you give

me an example of situations where you've done that now it's easy to make you say I just can't do that when people say I just can't do that in their mind they're interpreting as I'm telling this person this would be very hard for me to do I'm not really lying to this person I just said I just just can't do that but when you ask them have you ever done that before in any conditions and they have they're a little bit more likely to then have to quote unquote fess up and say well there have

been extreme cases where we've ended up doing that you know can you tell me when that happens I know I may not fall into one of those categories but it's just kind of useful to know how how the the process works and then sometimes they're a little bit more open to it right now there's other things you can do you can talk to other folks you can triangulate you can say well the HR person told me this what do you think you have to be careful that you don't look like you're going over someone's head

but you can still try to get information from different angles and see if that helps uh as well do you have like um different type of advice for um negotiating in like really small company where it's like five to 10 people no HR at all and where if you have like really close relationship with the person that you negotiate well you know in some ways everything we're saying becomes even more important right so it probably means that the the range of outcomes is much higher you could end up getting a lot less or a lot

more uh because there's very little precedent uh they're not concerned about the other people they're hiring that year potentially uh you have a relationship so there's already some Goodwill there uh so I would say you know being more honest becomes more important learning more about what they can and can't do becomes more important making sure they like you becomes more important and the range of things you can get from them is a lot more now keep in mind I'm saying the range is bigger I'm not saying the upper end of that range is higher than

what you can get with a traditional offer but if in a traditional offer the range is this in a non-traditional setting the range may be this all right and so you want to play your cards right even more so and by playing your cards I mean learning as much as you can about where they're coming from and there's one more thing it's not here influence and persuasion does matter a person who's never hired at Harvard Business School NBA or any MBA uh is maybe even more open to learning from you what it is that you

can bring to the table maybe they're undervaluing you not because they don't have as much money they're undervaluing you because they don't know what you can do well all right so if you can make the case if you can advise or inform them about how much other people make in companies like this or in with uh the kind of experience you have they may be more persuadable so maybe that range goes from here to even here so so that may be possible as well so it becomes more of a a two-way conversation not just understanding

and structuring but educating them as well about what's possible the last thing you want is to be underemployed by the same company that could have given you full employment all right if they're going to put you in a role in a position because they think that's their need but you can do even more for them have that conversation that's the best conversation you can have what if we were to increase the scope of what I can accomplish Maybe not today but over the next three years could we structure a deal that if we do this

this and this I'm in this position so so all of this I think just becomes more important because where you can end up is so varied yes ma'am um so you mentioned the currencies the flexibility of currencies what are some creative and often overlook typ currencies that mvs don't bring to the table or or you know everything except salary I mean I think people are overly focused on salary more than they're under focused on any one thing I think that's definitely a piece of it um but what's the the standard stuff I mean I mean

so okay maybe I'll add one thing which I briefly touched on before so certainly you can just list all the things you care about you know which city you're going to be on what kind of project you're going to be on um what kind of respons posibilities you're going to have what your start date is you know if you want to take the summer off or whatever else you want to do uh people may be able to give you some money for your uh MBA you know the loan stuff um but it's putting yourself in

position for the next negotiation which is often a good thing to do and maybe the last thing that you could ask for is to say I can't do this I understand you can't give it to me today but can we do something about this in six months or a year and people are often more open to that now uh the easy one is is being in a different office or a city sometimes you can work that conversation in fine we can't start there today but can we do that in x amount of time uh but

that's also true about your first performance review it's also true about the kind of bonus you may get uh you know I know I'm starting halfway through the year uh and my yearend bonus is going to be pro-rated accordingly but could we make a case for getting the full year because dot dot dot dot dot all right so there is some of that that you can do I think one of the things that we often forget to do is uh negotiating for things that they can give us in the future it's often a lot easier

for people to say yes to something that they don't have to give you for a year than to say something a yes to something they have to give up right now when they're in the middle of a very bureaucratic process um the only uh thing to keep in mind is they may just promise that and say it but you need to stay at the table over that next six months to a year to make sure they don't forget it to make sure that they didn't leave the company and now nobody in the company owes you

that to make sure there was no misunderstanding to make sure that as a company's needs change they don't con veniently ignore it so again in a respectful sort of way you want to make sure you're at the table and and and making sure those things happen assume a situation where we have another offer and then company is asking for what the offer from competitor is uh going forward let's say we have two options we can give that offer and hope that they would match it e it come back or we can say no I'm not

going to tell you what your offer is I better back what you have to say um and taking the second option the HR person sort of advises you not to take that route rather says this is a larger company you know the people who actually can make the decisions I only get to see them once a week uh you'll be free to give me this stuff right now still if you don't want to do it it's fine but I would highly advise you to let us know no when somebody highly advises you to do something

you know it's probably a good idea especially in a in a conversation where they're not out to get you really uh but the question was you know you have an offer from company a company B wants to know what company a is offering before they really structure their offer yes uh and uh you know ideally that doesn't come up uh but if it does again if a is pretty good you tell and and I mentioned this to you a little bit when we were talking offline but the way I would think about it is a

couple things one uh if offer a is also negotiable you can signal that when you tell them what it is is so I say well I have X as my salary for offer a but as you know even that's negotiable and we haven't discussed those so it's going to be this or higher so that gives you some leverage for the future the other thing is don't let them walk away thinking all you care about is that one issue either at the end of the day you should have the ability to say I know you're offering

the same amount as them but for the following reasons I could use some more all right now you have to think about what those reasons are and what it is but you know or less you know they should also be able to know whether you can accept a deal that's different on salary than the other one so I would say listen uh you're asking me to say something that I feel uncomfortable about not because I have any problem with the transparency element uh but because I think if I'm transparent on just one element you may

overweight that in your own discussions right so you know what they're offering me on salary and you can compare those but there's lots of other things about that job that I wish you could understand as well so that the package of offers you make me is compelling so here's the offer here here's here's what it is it's higher than what maybe you are used to but uh let's have this be a conversation so if you're welcome to having this as a conversation rather than a one-off thing then here's the information you need again if you

can avoid having to give up too much information before you get an offer great but if they're saying listen uh everybody knows you have this other offer and they'll know you didn't want to tell us what it is bad taste in people's mouth number one is the problem they don't like you uh and everything else is almost secondary and this is before they've given you the off offer so uh it's one thing to be disliked after they've given you the offer very bad uh much worse to be disliked before they've even chosen to hire you

um we're we're at 4:30 I'll take just maybe one or two questions people we haven't heard yet and then in the middle here uh any advice on how to deal with things like uh exit Clauses and things like non compete some those are kind of unpleasant things to talk about while you're getting an offer and need how to naate it depend on what you mean by how to navigate that when when there a lot of room to negotiate that is how do you I guess any tips on how to negotiate that without getting them to

not like you because you're talking about a preup or divorce before getting married because you're talking about not compete so like is there any way to have that conversation without leaving a our uh yeah Ian this may be a b more critic you but so we can talk about this afterwards but um in general uh keep in mind both sides tend to know these are uncomfortable conversations and legitimate conversations I don't know people who don't at some point you know people who are hiring understand that folks don't like to be too tied down because this

may not work out it may just be a bad match Etc at the same time if you look like you just want all the flex flexibility in the world you've never signaled real commitment anyway you might fall into the category of the people that they're most worried about it's about striking the balance it's about understanding what exactly their core concerns are maybe you can carve out some kind of non-compete that's not a very broad non-compete say listen what's your real concern well our real concern is you end up with company X okay what if we

carve that out well our real concern is you get training in the first six months you're gone in the seven month and all of our investment is gone what if we made the non the the non-compete a little bit shorter than the four years you proposed understanding where they're coming from why exactly they want something gives you more options always then you can maybe meet halfway or Target their core concerns still show some flexibility and work on all the other elements that they're worried about and maybe you can reach some sort of deal I'm going

to be mindful of of where we are in the time uh and I also have to go home and and and and on the way home pick up my kid so I I definitely don't want to lose that negotiation um so here's I I'll Stick Around for another just maybe uh you know five minutes here if you just want to stop in and and either say something or ask something really quickly on the way out uh good luck with your negotiations good luck with your career search and your career uh and uh you know stay

in touch if something really interesting happens uh you know uh and and be happy all right take care e