Negotiation TOP 10: Adapted from Professor Brian Gunia
What is negotiation?▪ Negotiation is a decision-making process by which two or more people agree on how to allocate scare and interdependent resources.
Do I have to negotiate?▪ If you want to maximize your current – and potential – income, then yes. For example, according to research by Brian Gunia, without negotiation, a starting salary might be $100,000 at age 30, rising to $551,602 by age 65. With negotiation, the same salary could start at $111,000 at age 30, rising to $612,278 by age 65. Assuming a 5% raise per year, the total lost income is over $1 million.
Identify your BATNA ▪ A BATNA is your “Best Alternative to a Negotiated Agreement.” According to Gunia, your BATNA is your greatest source of power. Before and during your negotiation, “do everything you can to improve your BATNA.” Don’t fall in love with the job that you are negotiating about. Staying clear-headed and having a good BATNA will help you to negotiate harder and will let you walk away if the negotiation does not work out in your favor.
What if I don’t have a BATNA?▪If you do not yet have a BATNA, you must invest time generating other alternatives. As the Carey Career Services office advises, it is unwise to focus all of your time and energy courting one company, job, or offer. Do your best to focus on a Plan A – but also Plans B and C.
I really don’t have a BATNA! What should I do?▪ Gunia suggests using objective standards in lieu of a BATNA, if you really do not have another alternative. Examples of objective standards include what other people at your level are receiving in terms of salary and/or benefits, what similar organizations offer employees, or what you have earned in the past.
Know your RP▪ An RP, or “Reservation Price,” is your “bottom line.” As Gunia writes, this is “the point at which you are truly indifferent between the negotiated agreement and walking away” and, mostly importantly, this “should not change!!!” Should your negotiation go lower than your RP, it is time to move to your BATNA.
Share – and request – information carefully▪ Gunia suggests sharing some information (e.g., priorities, ranking of benefits), but cautions negotiators not to say “too much” and never to share their RP. In return for sharing information, ask questions: ask the employer what matters most to them in terms of this negotiation.
Do your research – lots of it! – and create a planning document:
Know the company▪ Identify their nterests, strategies, expansion or acquisition plans – and how this will impact employees.
Know the labor market situation ▪How many people will be hired? What has been the yield in the past? What are your classmates/competitors being offered? What are the geographic/regional considerations? What is the company’s RP?
Know yourself▪What are your unique competencies? What are your fundamental interests for the negotiation (e.g., salary, bonuses, growth opportunities, benefits, location, travel, perks, workspace, etc.)?
Know the issues▪What is the base salary, signing bonus, annual bonus? Are there relocation fees to consider? Does the company offer stock options, retirement options, tuition reimbursement? Do benefits include housing assistance, paid leave, insurance, or care plans?
Know the fit▪What does the job require? Do you know what the job description calls for? Have you talked with alumni or current employees?
Prepare and practice▪ Know your answers for tough responses such as “That’s not negotiable” or “What is your ideal salary?” This is where research becomes necessary. Be sure to be ready to answer the question “What is your current salary?” If it’s good, Gunia suggests, “go ahead and reveal it. If not, politely refuse to divulge it… describe by this job is different” and explain what credentials you have achieved since your last salary was set (e.g., an MBA at Carey). Gunia goes on to suggest that you explain that your decision to take the job will depend on the entire employment package.
Look at the whole package▪Be sure that you do not only focus on the salary. A lot goes into an offer and an employment package – salary, bonuses, growth opportunities, benefits, travel, perks, workplace setting, etc. Try not to fixate on a number; focus instead on the entirety of the options available to you.
For any questions or concerns, or to discuss your particular situation or negotiation, please contact the Carey Career Services office at or 410.234.9270.
GOOD LUCK!