JOBTALKS
Accepting Your
Job Offer
Indiana University
Kelley School of Business
Accepting a Job Offer
Making an Informed Decision
Lecture Plan
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discuss negotiation positions
identify elements of an offer
view sample decision matrix
recognize ethics of offers
Congratulations!
You’ve Got An Offer!!
Now Comes the Challenging Part
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know your bargaining position
making an informed decision
savvy negotiation
accepting
Strategy of Negotiation
 foundation—what you do to ensure your
bargaining position is as strong as possible
 start working on it well before you sit down
to negotiate details
 builds your bargaining power
 makes the most of your talents, education,
job experiences, and recommendations
 neutralizes your limitations
Bargaining Position
 strong position
 lots of offers, outstanding tech skills, little
competition
 name your price, but w/strategy
 you want them glad to have you, not resentful
of your demands
 more typical position
 really want the job
 terrified of losing it by being too aggressive
 doesn’t negotiate effectively
Bargaining Power
 research industry standards for compensation
 resources are
 Trade magazines
 Salary surveys by professional associations,
government, websites, etc.
 Alumni feedback
 Occupational Outlook Handbook www.bls.gov/oco
 www.rileyguide.com/salary.html
 www.salary.com and other Web sites
 develop other job offers
Know The Market
 what is the going rate for the position
 do your research
 what positives or negatives might cause a
deviation from the going rate
 how much bargaining power do you have
 what factors are most important to you
 what is your best alternative plan
 what is the lowest salary you can accept
What Can The Employer Offer
salary
signing bonus
bonuses
commissions
moving allowance
early performance
review
 health plan
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 tuition
reimbursement
 stock awards or
options
 profit sharing
 pension plans
 lifestyle issues
 severance package
Salary
 base for figuring bonuses and raises
 savvy negotiating often improves an
initial offer---sometimes dramatically
 difficult to get same boost on the job
even w/excellent performance
Signing Bonus
 offered when they can’t pay a competitive
salary right away or luring someone away
from a competitor
 keeps departmental salary structure
because they are hidden from view as not
being a part of regular payroll
 often payment of bonus is delayed to keep
you from getting money and running
 commonly paid half at 6 months and
remainder at 12 months
Bonuses
 best if tied to measurable criteria
 requirements for earning it
 performance of a sales team you support
 reward for completing a schedule ahead of time
 reward for recovering a business relationship
that was lost
 based on customer satisfaction
 based on money saved through operational
streamlining
 finder’s fee for recruiting needed staff members
 tied to the number of new customers brought in
by marketing programs
Commissions
 sales goals
 commission percentage, standards for
meeting it, and additional rewards for
exceeding goals
 size and location of sales territory,
degree of exclusivity, and access to
specific accounts
 length of time to keep the territory if
you meet your goals
Moving Allowance
 may be tax-free
 may include nearly all moving expenses,
including
 hired movers
 temporary living quarters
 sometimes costs associated with real estate
transactions
 may be a fixed sum
 usually negotiable because it is a nonrecurring cost for the company
Early Performance Review
 for salary increase or promotion
 request a 6 month or even 3 month review
if you think you can make a significant
impact that fast
Health Plan
 company sponsored health plans vary
widely
 many smaller firms have none
 provisions of plan are not
negotiable
 expect to pay at least part of
the premium yourself from pretax income
 review company’s share of the premium
 look for at least two options to be offered by
employer
Tuition Reimbursement
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standard benefit that can be worth thousands
usually have to take night classes
classes usually have to be related to something that
benefits the company
some make loans rather than tuition grants and then
forgive a part of the loan for each year you remain after
concluding the education
try to arrange for any balance to be forgiven if you are laid
off
may also sponsor educational opportunities
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informal, on-the-job training
mentoring
formal courses and seminars
Stock Award or Options
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most common and lucrative at start-up and early-stage
companies
key is to argue that bigger ownership gives you more
incentive to be of extraordinary value
larger, established companies are less negotiable, offer
relatively fewer shares, and are sometimes restricted to
middle and upper management
not so profitable in near-term money, but over 10-15 years
they can be sizable
do the math…know the number of shares offered and the and
percentage of total shares
start-up shares are only valuable if and when the company
goes public or is sold
ask about length of time for vesting before you can exercise
options
if you’re planning on a short stay, these aren’t of much value
Profit Sharing
 profit sharing
 form of incentive pay based on the
company’s performance
 you agree that a percentage of your
compensation will be
based on the firm’s
overall profits or
profits from certain
deals
Pension Profit Sharing or 401 (k)
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employer contributes a certain amount to your pension plan
each year
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usually figured as a percentage of your salary
based on the company’s profitability
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some plans allow for borrowing against it or making early
withdrawals
buying a home
paying your kids’ college tuition
medical care
company sets aside a portion of your pretax income in a
tax-deferred investment account
most employers match full or partial contributions
in principle, money is supposed to remain until retirement
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must conform to government regulation so terms are not
negotiable
Lifestyle Issues
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location
travel schedule
need to balance work and family
future stability
Severance Package
 negotiate for 3 months salary if your
employment is terminated through no
fault of your own
 this should be the last area of your
negotiation
 bring it up as a conjecture, e.g. what
if…
 get the deal in writing in case your
manager is laid off
Determine Negotiating Priorities
 use these to evaluate offers
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quality of learning opportunity
rapport w/your supervisor
respect for your colleagues
workplace atmosphere
 intense or relaxed
 competitive or mutually supportive
 chaotic or organized
 work alone or part of a group or combination of
two
 socializing or being more private
More Priorities to Consider
 other forms of compensation
 benefits such as health
insurance
 perks, e.g. international travel
 recognition, e.g. speaking
opportunities
 company’s prestige
 importance or value of what
the organization produces
More Priorities to Consider
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vacation and time-off policies
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usually paid time computed by formula based on time with the
company
may also be allowed extra time without pay
don’t make it first on your list of demands or you look like
you’re not enthused about your job
flexibility of the work schedule
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8 am to 6pm is most common schedule
permission to work from home two or three days per week
may be better off proving yourself first and then negotiating
flexibility
may be able to negotiate comp time, generally an hour off for
each hour of overtime
ask about cashing in unused comp time at the end of the year,
but make sure you document your time well
More Priorities to Consider
 career-advancement opportunities
 location
 commuting distance and related
considerations, e.g. availability of
public transportation or parking
 on-site facilities, e.g. fitness, childcare centers
Using a Decision Matrix
 helps stay focused on the factors of
most importance to you
 identifies your main negotiating
points
 recognizes when you should decline
an offer
Creating a Decision Matrix
 list the factors that matter most to
you
 assign each a relative weight out of a
total weight of 100
 rate how strong the offer is on each
factor on a 0 to 10 scale
 multiply the weight for each factor by
the rating you gave
 add up the results for each factor
Negotiation Tactics
 what you do to
achieve the best
outcome
considering your
bargaining position
You’re Not Buying a Car!!
 resist the classic sense of negotiation where
they offer, you counter, they counter your
counter, and so on
 determine your bottom line in advance and
wait for the offer
 if they offer more than your bottom line, great
 if they offer less than your bottom line, then
 walk away or
 reveal your bottom line and see if they can
meet it
 lay your cards on the table to avoid
aggravating the employer
Always Negotiate With
The Decision Maker
 they know more about the job
 they are more concerned about losing you
 they have more latitude in taking in special
circumstances
 they are more creative
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flexible hours
extra vacation days
signing bonus
company-furnished laptop
Avoid Pushing Too Far
 your deal will be resented
 you invite over-scrutiny and criticism
 you have to live in the climate you create
Ask Yourself Questions
 do you care enough about it to meet expectations
 is the money, recognition, or intrinsic value rewarding
enough
 are the expectations realistic
 will you be happy there in six months
 are there enough challenges and learning
opportunities to keep the job fresh over time
 are you intrigued by the ongoing responsibilities or
just solving the initial problem
 do you commonly fall prey to the grass is always
greener syndrome
 do you stick to what you start
 how well do you fit into the company’s culture
Never Name The Salary First
 too high and you risk scaring away
the employer
 too low and you shortchange
yourself or devalue the
position
Don’t Ask For It All
 a long list looks like you’re a high
maintenance employee
 concentrate on the 2 or 3 things that
matter the most to you
 consider the other options only as
part of your decision matrix for
evaluating offers
End of Negotiation Signals
 final words that signal the end
 “I just can’t go beyond what I’ve agreed
to already”
 “I think your expectations are beyond
what we can do”
 “Please consider this our final offer”
 continued pushing will cause
alienation and negative outcomes
Immobile Barriers To Negotiation
 union contract terms
 policies set by the board of directors,
such as formulas for determining pay
 policies set by management, such as
not providing allowances
 group-hire decisions, such as
internships
 the pay level or your peers or the
person you would report to
Offers May Have Strings Attached
 pass a physical examination
 document your citizenship or immigration
status
 obtain a security clearance
 undergo a thorough background
investigation , in which your credit history,
police records, and travel history might be
examined
 verify your academic credentials
 provide proof of your past employment,
salary, or military service
Ethics to Consider
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delaying a decision
declining an offer
reneging on an offer
accepting an offer
Delaying a Decision
 be reasonable, but you can usually
get more time to decide
 if negotiations have been verbal, ask
to receive the terms in writing
 ask for a few days to consider the
offer
 clarify a few points if more time
needed
Declining A Job Offer
 act decisively; don’t string them
along further
 call or email a thank you for the
manager’s time and efforts
 graciousness means you won’t burn
any bridges
Reneging On An Offer
 you accept an offer, quit your current job
and your partner quits theirs, sell your
house then the company backs out…how
does that feel?
 employer has terminated discussions with
other candidates and does many other
things
 it’s disrespectful to the company and lacks
integrity
 it’s dishonest
 avoid this problem by careful planning
about your ideal position
Ethics Of Accepting A Job Offer
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get it in writing on company letterhead and signed by hiring
manager
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title and major responsibilities
starting date
person you will report to
salary
other forms of compensation, i.e. bonuses, commissions and
details
stock options, dates they will be granted, the vesting schedule
perks, e.g. moving allowance, tuition reimbursement, extra
vacation time, flextime, early salary review, other special
arrangements agreed upon
written offer is a contract once it is signed by you
if they are reluctant to write it, you do it and submit it
file a signed final copy in a safe place
stop interviewing and notifying any pending companies
Congratulations!
You’re Hired!