J. Jay Gerber Professor of Dispute Resolution & Organizations in the Kellogg School of Management at Northwestern University
Negotiating your salary in your first job has a dramatic impact on your financial future. For example, the person who negotiates to make an additional $5,000 in starting salary will earn at least $600,000 more in lifetime earnings, assuming standard yearly raises, than the person who does not ask — even if that person never negotiates again.
Professor Leigh Thompson, who teaches in Executive Education programs such as the Negotiating in a Virtual World online program, Leading High-Impact Teams, High Performance Negotiation Skills, Constructive Collaboration and Navigating Workplace Conflict, was intrigued by job and salary negotiations and how women fared versus men. She and colleagues Laura Kray, Adam Galinsky and Jason Pierce examined the approaches taken and the results achieved — and found startling differences.
First and foremost, women are less likely to initiate negotiations as compared to men. Second, when preparing to negotiate, women are less likely to set aggressive goals. And once negotiations actually commence, they aren’t as willing to make an assertive opening offer.
Why? Research indicates women have good reason to hold back because of the backlash effect — which is the negative repercussion suffered by women who behave assertively.
So now women face a catch-22: Namely, women who don’t ask for more will certainly earn less; but if they do ask for more, their assertive behavior will backfire, also resulting in a poor outcome.
Is there any light at the end of the tunnel?
“Actually, there is,” said Thompson. “There are some specific best practices that can give women at least a 10 percent improvement at the negotiation table — and, with practice, hopefully more.”
Thompson offers three tips for women to add to their negotiation repertoire to improve both their economic and social outcomes:
Get the script
Many negotiation situations are not scripted and are highly ambiguous, emerging without formal notice. “When they don’t get a memo, women don’t go into negotiation mode,” Thompson noted. “It’s important to think of your most important work situations as always being negotiable.” As an example, she points to a situation that former Hewlett-Packard CEO Carly Fiorina faced when she was with AT&T, negotiating in Korea with the president of what is now LG. Fiorina was slated to go to a traditional barbecue as the only female in a group of men. All of the men would have female companions assigned to them, and Fiorina figured out that the arrangement was designed to give the men someone to attend to them during the event and make them look good. So she asked for a woman, too, and that companion’s knowledge saved her during a long series of toasts designed to test her ability to hold her scotch. The trick was to have the companion surreptitiously pour the drinks out, as the men’s companions were doing. And it worked: With the woman’s help, Fiorina proved herself by keeping up. “Think about the next time you’re in a situation that’s the equivalent of a Korean barbecue,” says Thompson. “The next time you’re in an equivalent situation, find the script or write the script and make it work for you.”
Negotiate on behalf of a constituency
“When women negotiate in one-on-one situations, they are less assertive and less successful than men. However, “women behave more like the prototypical male when they’re negotiating on behalf of someone else,” Thompson points out. “I tell women that even if they have to imagine negotiating on behalf of their team, their retired self or a future child, that is going to help.”
Call out the gorilla in the room
Alexa Stabler, an agent for NFL players, addressed the fact that she’s a woman in a male-dominated industry right off the bat, according to Thompson, and then she explained why her gender is an asset to a potential client and how it will give her an edge in representing them. She uses what might be perceived as a weakness and presents it as a strength. In Thompson’s research with Galinsky and Kray, when the gorilla in the room was pointed out — in this case, when women were told that their gender may be an issue — they went into combat mode and were dramatically more successful than they were when gender was not explicitly mentioned as a possible concern.
Successfully changing the negotiation dynamic for women is not easy, Thompson concedes. Women are often socialized to make wanting to be liked a priority and to think that if they perform well, that performance will be recognized and rewarded without them calling attention to it. Not so. In order to get what they want, women must assert themselves and put worries about the potential backlash aside. “I’d rather ruffle feathers and be walking to the bank than be known as the nice woman in the poorhouse,” she said. “I liken it to playing tennis. The first time, it feels awkward, and you don’t do so well. But it’s amazing how quickly you learn.”