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June 27, 2014
How to Know What You Are Worth

I recently gave a talk to a group of design students on negotiating their first salaries. Worth and how to determine it was very much on their minds. Three were in the process of bargaining:
Laid off from her first position out of school (the company closed), she was interviewed at another company, which offered her $45k. Then, they asked her what her previous employer paid. She said $38k and they lowered their offer to $40k. The drop caught her completely by surprise. She went from feeling good, to feeling sick, in a heartbeat. Her self worth had just dropped $5k. The shock was physical; her chest clenched. What should she do?
My observations:
>If she accepts the $40k she’ll lose respect.
>If she asks for the $45k they’ll attempt to get her down to $42–$43k.
>If she asks for more, say $46–$47k, they will be impressed with her confidence. She may not get the job, but she’d walk out with their respect and her own.
What happened:
Shocked and overwhelmed, she turned down the $40k. The meeting ended. She’s now expecting offers from two other employers. Further, the experience helped her understand why she shouldn’t reveal her past salary history and to ask for what she needs.
Just out of school, she was offered slightly under a $100k by two firms. The two offers filled her with confidence. Better yet, one of them also offered Bridgett an $18k signing bonus. She favored the firm that had not offered the bonus. Both firms told her she couldn't tell competitors what she'd been offered. Should she use the signing bonus offer as leverage?
My observations:
>With little experience, she needs all the help she can get.
>Bridget’s cred is expanded significantly by the two offers.
>Employers use their power to hold down salaries.
>Bridget should absolutely use the signing bonus as leverage to get the position she wants, on terms she is happy with.
What happened:
Bridget told the company she favored that she wanted to work for them, but that she was concerned about the high cost of living in their area. She also told them that she’d been offered the $18k signing bonus. They matched it and she accepted.
He told the first recruiter what his last position paid and they offered $2k more. Andrew declined. He refused to tell a second recruiter what he'd been paid and they said they couldn't make an offer if he didn't tell them and the meeting ended. Andrew left with that sinking feeling that you get when you think you pushed too hard. The next day they called and offered $20k more than he'd ever been paid. Why did that happen? 
My observations:
>Clearly, the recruiter was impressed with Andrew.
>The recruiter’s offer had to be based on their appreciation of Andrew without the past salary reference point.
>Andrew raised the recruiter’s respect by refusing to reveal his salary history.
What happened:
Andrew took the position.
And finally:
Widely available salary surveys provide a way for determining your worth. And it’s important to know the range. But, developing the confidence to ask for what you need is an emotional skill and harder to master than gathering pay range facts. Learning to note and master your feelings during stressful situations is the real key to negotiation success and with it you’ll gain respect as well.
Ask yourself: Do I know what I need to succeed and how to ask for it?

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Ted Leonhardt has provided management consulting and negotiation training exclusively to creative businesses since 2005. He cofounded the The Leonhardt Group, a brand design firm in 1985 and sold it in 1999. In 2001 and 2002 Ted served as Chief Creative Officer for Fitch Worldwide, out of London. In 2003 through early 2005 Ted was president of Anthem Worldwide, a brand packaging design group.     
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