If you’re a woman, chances are strong that you’re reluctant to negotiate for more money. Here are five reasons why — and some tips on how to unleash your inner negotiator.
I was in my final year of university when my mother gave me a profound piece of business and career advice.
“Eleanor,” she said. “Understand that money is power.”
Does this make you want to squirm? I remember being **shocked** at this never-before-seen display of what I (sanctimoniously) deemed to be blatant, money-grubbing materialism.
Nice girls did not talk about money.
And besides, I didn’t want to make money. I wanted to make a difference.
And the fact that I wanted to be making a difference whilst clothed in a chic wardrobe and living in a lovely apartment?
Well, I made the classic female mistake of assuming that if I worked hard and did my best, my efforts would be noticed and the money would naturally follow.
Years later, I see the wisdom of my mother’s advice.
Money is power.
Money is the power to provide for your family.
It’s the power to command what you’re worth.
And it’s the power to create a great lifestyle doing what you love without working yourself to the bone.
In short, my mother was right. Money does equate to power – a certain kind of power, anyway.
And it’s a power too few women are claiming.
North American women are currently earning about 77 cents for every dollar that men earn.
There are lots of reasons for that: taking time off work for maternity leave, pursuing careers that don’t pay as well etc.
But here’s another reason women are still getting less pay for equal work:
We don’t negotiate.
A recent study of Harvard MBA grads found that only one-eighth of women negotiated their salary offers compared to half of the men.
To which I offer a well-worn piece of advice: if you don’t ask, you don’t get.
Time and again, I hear from senior leaders that men almost always try to negotiate for more money, while women almost never do.
Here are five reasons why:
1. We make the classic mistake of assuming that hard work is rewarded with promotions and pay raises.
The truth: in the world of work, confidence is rewarded as much, if not more, than competence. If you want more money, you not only have to earn it, you have to (confidently) ask for it.
2. We get so caught up in being a good team player, that we hold back from asking for more money because we’re worried we might come off as self-centered or salesy.
The truth: Money is the currency we use in the world of work to reward performance. You are running a business/building a career. You are not a one-person charity. No one is going to be mad at you because you negotiated. You’re not letting down “your team” by asking for more money. You are simply opening up a discussion about how you are compensated for what you do. So engage in the conversation. Ask for it.
3. We fail to understand the true value of what we’re offering.
This is a classic mistake for entrepreneurs of all stripes — not just women. We don’t appreciate the full value of what we’re offering our clients – often because the solution we provide comes so naturally to us – that we undervalue ourselves.
Another related entrepreneur mistake – we apply the “employee” mentality to pricing and compare what we charge per hour with what a counterpart would earn while working for an employer. A rookie mistake, but one I nevertheless see all the time.
Your hourly rate should reflect not only your expertise and time, but also all the costs required to run your business. If you are making the same hourly rate in your business that someone with the same skill level is making in a paid position, you’re undercharging.
The trick: take the time to list the results you provide and the resulting transformation this result creates for your customer. Then calculate the cost of that client NOT working with you. That should give you a good reference point for pricing what you’re worth.
4. We wait for someone’s permission to ask for a raise.
Oho, the old raise your hand to ask a question routine. It’ll get you every time.
The truth: there is no permission granter of raises or price increases. If the money you make is starting to bug you and if you’re great at what you do, ask.
5. We (rightfully) sense that the social costs for negotiating are higher for women than for men.
Before you start criticizing yourself for being reluctant to negotiate for more money, understand that your hesitation isn’t without grounds.
There are lots of studies showing that the social discomfort caused by negotiating can be more costly for women than for men.
It is socially acceptable for a man to simply and directly lay out what he wants.
But women have to take things one step further. We need to clearly lay out what we want and also show that we are taking the other side’s perspective.
I know, it feels pointless, sexist and tiring. It is. And that’s the world we live in.
Here’s how you to take a relational approach to asking for more money.
First, you explain why in the eyes of your negotiating partner, it’s legitimate for you to be negotiating in the first place.
If you were negotiating higher pay for a new role as a group director, you’d outline that, if they are hiring you to lead a team, it’s important that you show yourself to a) be a good negotiator, and b) be willing to start a difficult conversation.
Next, you emphasize that you take the relationship seriously. Facebook COO Sheryl Sandberg puts it this way during negotiations: “This is the only time you and I will ever be on opposite sides of the table.”
This acknowledgement demonstrates that you are able to stand up for yourself AND that you place a high priority on the underlying relationship…i.e. with the exception of this one time, we’ll always be in it together.
Here’s one more bonus reason women don’t negotiate:
Because we’re waiting for the conversation to NOT feel awkward.
Tip: Negotiations are always a little awkward.
Putting yourself out there and asking for what you want makes you vulnerable. And that’s scary for most people.
But there’s much strength to be gained from taking bold action.
So when you feel the fear of asking for more money…
Take a deep breath, and do it anyway.
Don’t give your work away.
Claim your power.
Get paid what you deserve.
(Oh, and when you do successfuly get the raise or up your rates? My mom says to tell you that you’re welcome.)