The Fantastic Life

Negotiation is the Ultimate Productivity Hack

I negotiate on behalf of my clients every single day, and have for over 35 years. I sometimes forget how engrained negotiations are in my life. Negotiation is an obvious requirement for my job, but, as the below article explains, it’s really necessary for everyone, not just those who work in real estate or sales. EVERYONE should know how to negotiate to get what they want.

The below article briefly describes a key finding from Stanford MBA professor Margaret A. Neale. Neale notes that in a hypothetical situation where you and a coworker both start at a $100K salary — but your coworker negotiates a 7% bump early on — over the life of your career you’ll have to work an extra eight years to catch up to them. 

Negotiation isn’t just about money; it’s about having more life and freedom. Sometimes you’re negotiating for a raise, other times you’re negotiating a later curfew for your teenager. You will even find yourself negotiating with yourself all the time. Here is one I am working on: changing my schedule to offer more time for the activities I love.

Negotiate early and often, and watch your life get better.

Rule # 5: Get a Win

Negotiation is about creating a win-win situation for both parties. You should always walk away from a negotiation with a win. 

The Fate Of Elon Musk’s Assistant Is A Cautionary Tale For Negotiating Salary

By Nick Wolny

March 2, 2021

Credit: Kevin Sterjo. Subject to copyright

I broke one of my writing rules last month when I wrote about Elon Musk, and I’m breaking it again today. It’s not that I have anything against the South African CEO, but between Tesla’s bitcoin bet, feeding the GameStop frenzy, and temporarily dethroning Jeff Bezos as the world’s richest human, it seems like he gets covered enough already.

Usually, I steer clear of entrepreneurs who do things like name their child X Æ A-12. But then I was assigned an article for Entrepreneur last month covering how much money billionaires made in their sleep last year. Thanks to Tesla’s wild stock growth in 2020, Musk was at the top of that list, generating an eye-popping $88.3 million USD every night — dreamland, indeed.

As I combed through mountains of Musk articles for research, a quiet-yet-compelling story caught my eye. It’s one that serves as an important cautionary tale when it comes to negotiating your salary.

Don’t get me wrong — Negotiation is the ultimate productivity hack. Stanford MBA professor Margaret A. Neale notes that in a hypothetical situation where you and a coworker both start at a $100K salary — but your coworker negotiates a 7% bump early on — over the life of your career you’ll have to work an extra eight years to catch up to them. Negotiation isn’t just about money; it’s about having more life and freedom.

When you get too confident, however, things can quickly go sideways. If you’ve considered initiating a conversation about a raise in the future, you’ll want to keep this following story in mind.

Elon’s test

Mary Beth Brown was Musk’s longtime assistant, being at his side day in and day out for 12 years. If you’ve ever watched a high-powered CEO, you know that executive assistants practically hand their lives over for these kinds of jobs, as they require extensive travel and service.

According to Ashlee Vance’s biography on Elon Musk, Brown was even more than that. She sometimes made business decisions as well, and wanted to be compensated at the level of an executive. After over a decade by his side — and still apparently at assistant pay — she asked Musk to bump her compensation accordingly.

Musk’s next move was deeply utilitarian: He told Brown to take two weeks off, and if she really was indispensable, her absence would be truly felt.

When Brown showed up again for work after her hiatus, Musk informed her they had learned to operate without her and that her position was no longer available. The CEO did offer her a different position in the company, but wouldn’t offer executive pay.

Brown declined. Was it an icy and ruthless way to end someone’s tenure? Did Brown wait too long to make a move toward being compensated what she was worth? Years later, the story still stirs up lively debate amongst ambitious professionals.

The takeaways

Musk disputes details of the story, but biographer Vance told CNBC the anecdote is well-sourced. Whatever the truth might be, there are insights to be gleaned on how to play the negotiation game well.

  • Avoid getting cocky. I’m a small business owner with a payroll, so let me share the bad news: There’s no such thing as an irreplaceable employee. Change agents are welcome — and I’m happy to pay you top dollar for top performance — but I’m also mitigating risk and planning ahead for if and when employees want to move on. Assume your boss is doing the same.
  • Make negotiations a win/win. Salary negotiations often fail because you’re asking for more compensation for the same amount of work. Instead, pitch a project you can take on that will make or save the company more money, covering the bump you’re asking for. Then go crush it.
  • Negotiate smaller bumps more frequently. Once you’ve dialed in the first two steps… make win/win conversations a habit. We often see stories of startups growing at warp speed, but the reality is that most companies grow gradually. Rack up a series of small raises rather than a giant pay bump all at once and your chances of success will be much higher.

Whether you’re an employee, an entrepreneur, or something in between, it’s possible to take control of your income. The key is to be strategic and pace yourself. Identify what you’re worth, then make deals with clients and managers that ensure everyone wins along the way.

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