The money question

The money question always comes up in job interviews. If you are a candidate looking at a new position, you can safely assume the person on the other side of the desk will ask some form of the money question. Your answer is difference between moving forward and being eliminated.

In an interview, the employer has four basic questions in mind. However they dress them up, whatever creative spin they put on them, employers really want to know four things:
1. Who are you?
2. Why are you here?
3. What can you do for me?
4. How much will it cost?

That final question can make or break the situation. If you answer it wrong, you're done. The correct answer is non - numerical. A number, whether too high or too low, is ALWAYS wrong.

The employer will invariably ask something like, "How much money do you need to consider for this position?" Or else, "What will it take for you to come to work for our company?"

If you want to be considered for the position do NOT, under any circumstances, give a numerical answer. The correct answer is something on the order of, "I'm here to discuss the position and assess my fit with your organization. I want to make sure my talents are a good match for the duties you're outlining. You're probably thinking along the same lines. I am sure, if we get to that place, we can reach an accommodation."

Why answer that way? Because it's the truth.

The demand - interest barometer tells us that, for a candidate, as demands go up, interest goes down. And as interest goes up, demands go down. If you as a candidate articulate a number too early in the process, you're drawing a line in the sand and creating an impression that you're more about reward than effort, more about price than value.

A number which is either too high or too low is wrong for several reasons.

The interviewer will eliminate you from consideration if you articulate a number that's too high. Whether they can afford the amount you say or whether you're worth that amount is immaterial. If you as the candidate create the impression that you overvalue your skills (in other words say any number above the range they've calculated), they are concerned you will never "settle" for the amount they're offering. So they will remove you from the process.

Conversely, if you say a number that's too low, you might inadvertently wind up accepting compensation less than the amount the company budgeted because that's what you said. You reduced your ability to negotiate because you have too little information.

Over the years, in coaching people on successful interviewing techniques, the money question is the one where people stumble most often. Many times people will tell me, "I just wasn't prepared for the question ... the number just popped out of my mouth." Or else they will say, "I told her $X because I think I'm worth it."

Bottom line, it doesn't matter what YOU think you're worth. The magic number is always somewhere in the range between what they want to pay and what you think you should get. I've been in career coaching and recruiting for 20 years. This has been my experience.

When the employer asks, "How much ... ? " the right answer is, "We'll know when we get there." If they ask again, insisting on an answer, defer diplomatically a second time. Something on the order of, "I appreciate you want a number. I'm a little uncomfortable making anything which could be perceived as a demand at this early stage. I'm interested in the position and would like to learn more."

And if they ask a third time, the correct answer is, "My year to date compensation is $Z."

But why give a number that way? Simple. It's a statement of fact, not an estimate of self-esteem. You compensation is verifiable. An employer can ask for and receive verification of income. You pay taxes. Your income is a public record. In the real world, your current or most recent employer valued you at an identified level. That's the number to share.

So ... don't get caught by the money question. Role play with a friend or practice in the mirror. Be prepared for this inevitable question. Your ability to answer the money question with an non-answer can get you the job or get you more money for the job you really want.

Is it really that bad out there?

An industry friend, who is the General Manager of a small, specialty sport distributor, sent me an interesting email last week:

Desperation seems to have made it to this [specialty] industry. Maybe it's been going on for a while and I just didn't have an opportunity to witness it first hand. But I have been surprised by some recent events.

I had to let a couple people go at my company recently. In my efforts to find replacements I have been stunned by the complete disregard for discussion or negotiation of salary or benefits by the applicants.

Some have tried to posture early in the discussions when I ask what their salary requirements are. But when I give them an idea of the pay range for my open inside sales positions, even when it's half of what they used to make, they say they will take what I'm offering ($30k plus $10k potential commission).

I interviewed someone yesterday who was over qualified for the position. I told him so when I spoke with him on the phone initially. But I invited him in to meet and discuss potential future opportunities - when I have a need for someone of his experience.

We talked. It was a good meeting. When I was wrapping it up, he just came right out and said, "I don't care what the salary is ... I'd like to pursue your current opening."

He was making $85k at his last job and he was willing to take what I was offering, which was less than half his previous pay. He didn't negotiate or ask about benefits.

I've interviewed four applicants. Not one has tried to "up sell" themselves, asked a question about benefits and, if relocation is necessary, would we pay any of the costs.

The basic attitude is - make me an offer, any offer - I'll take it!

Is it really that bad out there in this [specialty] biz?

My friend is a thoughtful, experienced professional with a good heart. I have several reactions to his rhetorical question and the implied questions he's not asking directly.

Here are my responses in no specific order:
1. People who are enthusiasts within a specialty sport derive career satisfaction from their involvement. They are not money - motivated and some are not career - motivated. Their joy comes from immersion in the sport. I would not expect them to have honed negotiating skills.

2. Inside sales people earning $30K plus bonus are probably early career stage and looking to join a thriving business. Maybe they've been laid off from a downsizing firm. Ergo, if a company is hiring, it's probably doing well and therefore the job seeker can take refuge there.

3. My caveat to my friend was to watch out for the "any port in a storm" people like the over qualified candidate. Because once things stabilize and then improve -- and we all know they will -- that's precisely the individual who will be out the door first. With a chip on his shoulder.

4. For all the candidates out there, here's an interesting twist. When interviewing for a position, even at a $30K inside sales gig, the hiring manager EXPECTS you to ask for more ... compensation, incentive, relocation, something. Shame on you if you don't.

5. My friend asks indirectly: Is it really this bad? If so, why aren't we hearing it in the [specialty industry] press? Answer: Because the trade press leads the cheers for the industry. They cannot come right out and say, "The Emperor is naked!"

6. He told me verbally big suppliers are concerned with the level of debt retailers are taking on because they are NOT too big to fail. Further, industry press proclaiming gloom only makes matters worse, he said. But some accurate, realistic reporting would be appreciated.

The dreaded counter offer

Counter offer happens after an employee announces his or her resignation. The current company offers that person additional compensation to stay.

This is a very sensitive subject. As a recruiter, when a candidate is getting close to receiving an offer from my client, I always ask how they will handle the counter offer. We have a discussion about how accepting a counter offer is career suicide.

Did you know they're paying you more to stay while they start to search for your replacement? Where was this money before? What are the reasons you considered the new position? Will those reasons go away with slightly more money?

Here's a lovely post on counter offer from Evil HR Lady. Find the comments as instructive as the piece.