Have you ever wondered why there isn’t much written about negotiating the terms of a job offer? It’s because many dentists consider it an uncomfortable part of the Right hiring process. Many doctors fail to understand the process of compensation negotiation. It is not simply offering the lowest wage for services rendered. Communication, preparation, trust, a mutual understanding of each party’s position and willingness to compromise are the key ingredients of successful negotiations. In the end both parties must feel they have reached an agreement that serves their mutual interests.
Below are the 10 keys to successful compensation negotiation. Follow these simple rules and you should achieve success in this important strategic tool of compensation negotiation.
1. Do your homework. Make sure you have done your research on the wage you are offering for the position being offered. Uncovering wage information is not as difficult as it may seem. Consider the following resources:
- Ask at least 3 of your dental colleagues for their pay scales.
- Check out on-line salary surveys like http://www.salary.com.
- Use job listings which indicate compensation for related positions.
- Ask friends in different yet comparable professions (Chiropractic, Accountant, Physician, and Architect).
2. Never negotiate without an offer in mind. The only time to negotiate a compensation package is when you have a clear offer formulated in advance and you are prepared to put that offer on the table in writing.
3. Think relationship. Remember your offer negotiation is taking place in the spirit of developing a relationship with a prospective new employee. Put yourself in the position of the person on the other side of the desk and you’ll realize he/she is probably as uncomfortable as you are.
4. Leave your ego at the door. Avoid, at all costs the temptation to be egotistical. Avoid making wage discussions be part of an ego trip or part of a game. This is serious business for both you and the candidate.
5. Relax. It’s natural to feel uncomfortable and uneasy about discussing money.
6. Hold off. If asked early on in the interview process, “What is the pay?” Tell the prospect that you would prefer learning more about them, their talents and past performance before you discuss compensation and that you are confident you will be able to reach a mutual agreement about pay at that time.
7. Avoid showing the buying signs. Take time to ask questions relevant to the position and learn how the candidate has performed in similar positions and situations. When you extend the interview longer than planned, or you start talking about yourself, the practice, and its history or you ask about the prospects wage and benefits needs, you may come across as too eager. You may loose leverage in the wage negotiation process.
8. Maintain control. When all your issues have been addressed satisfactorily, make the wage offer. Summarize the requirements and expected outputs of the position and then disclose to the candidate the wage you are offering.
9. Make a clear offer while having a range in mind. When all questioning has been completed to your satisfaction, references have been checked and you believe this is the Right candidate, make an unambiguous and unmistakable offer. However, be prepared with a range (that is a wage that is competitive and you are comfortable with) that will allow you to enhance upwards if the candidate balks and he/she is the Right one for your office.
10. Offer up the whole enchilada. Many practices use a variety of benefits and incentives to attract high level talent beyond a base wage. Include all perks, benefits and extras that will be included in the compensation package. An increasing number of employers are offering flexible benefit packages, which allow employees a variety of choices regarding their benefits. Tell the prospect what the whole package will look like.
It is critical to develop a negotiation strategy just as you develop a strategy for handling standard interview questions. Make a clear distinction between the negotiation of a position and discussions about the wage to be offered. It will help if you keep in mind the first principle of successful negotiation: Do your homework and never negotiate without an offer in mind. Preparation is the key element in successful compensation negotiation. Negotiating compensation packages requires a positive approach and both you and your prospective new employee have individual interests at stake. Look for ways to reconcile both by creating opportunities for mutual gain.
BONUS:
11. Put your offer in writing. In the emotion and nervousness of the Negotiations, details can often be overlooked. In all fairness to you and your new employee, your agreement needs to be put in written form. The offer spells out the points of your agreement. This will dramatically reduce the chances for misunderstandings that may occur at a later date.