Tony Soprano, HR Manager – Negotiating Offers With Candidates

Kris Dunn Always Be Closing, Making Offers, Recruiting

Lots of strong professionals are looking for help when it comes to the art of negotiating offers with candidates….

My advice?  Be proactive and make them an offer they can’t refuse.  Tony Soprano would be proud.Tony_soprano

Here’s the reality behind that comment.  In the vast majority of hiring situations, both sides (candidate and employer) are looking to minimize the conversations regarding compensation.   Why?  It’s uncomfortable and not something we deal with every day.  Additionally, the employer side is often the one who is the most uncomfortable.  After all, in negotiating an offer, we are making value statements about the human being on the other side of the table, whereas we are dealing with OPM (other people’s money) on our side unless we are running our own business.  With that in mind, we’re aware that it’s much more personal for the candidate, and that tends to make us more uncomfortable as employer-side representatives.

But we still have to fill the spot for what we can afford and what the talent is worth…

My advice to those that hate negotiations as part of the offer stage?  Stop the negotiating before it begins.  Here’s how:

1.  Never ask the candidate "What’s it going to take?" – Don’t do it.  You’ll be sorry and will effectively be transferring the balance of power in the negotiation to the candidate.

2. Always have your careers site set up to capture current and expected compensation for the position the candidate applied for –  To figure out where you need to be in the offer process, you need data.  Don’t get your initial data by asking the candidate – that’s riddled with issues – get it via technology when they apply for the position.  Drive all candidates through the online process, regardless of the source they originated from.  Ask them as part of that process what they currently make and what they think they need to make with your company.  You’ll need the data and be shocked by the accuracy of the info you receive.  (See www.taleo.com for $100/month solutions if you don’t have one).

3.  Tell the candidate what you can spend and seek their commitment – This is the key.  Once you have data on what the candidate makes in their current position and what they want to make with your company, figure out what you want to spend.  Once you have determined that, end your initial phone screen/interview with the candidate by telling them the general offer specs you will make to the successful candidate, including a salary number.  Once that’s done, directly ask the candidate if they will accept that offer if provided to them at the end of the process.

4.  Hold firm on the specs of the projected offer in the conversation that follows – One of a couple of things will happen when you pro-actively tell them what the offer will look like at the end of the process.  The candidate will say A) "That Sounds Great" (which happens more than you would think), or B) the candidate will want to probe your flexibility on those compensation specs.  Your job in this stage is to remain firm, providing reasons that offer has to the one you use, which can include budget, internal equity or market rate considerations.  You’re the expert in all those, so use your expert power to your advantage.

5.  Close by seeking a commitment – If the candidate wanted to discuss your flexibility on the projected offer specs you outlined, you have to come back and seek commitment.  Use a phrase like, "Having walked through the reasons for what we can provide for this position, if you are the selected candidate at the end of the process, will you accept that offer?" 

Follow these steps and you’ll be able to hold most offers to the range you can afford, and you won’t lose many candidates in the process.  Following this process doesn’t make you cheap, it makes you an effective offer negotiator. 

Like Tony would say, it’s all about setting expectations up front.    You just have to screen out the Paulie Walnuts of the applicant pool….