A Salary Is No Joking Matter – or Is It?

Humor is a powerful tool. Wielded well (particularly in a self-deprecating manner), it can help defuse tension, build rapport and boost morale.

But who would have guessed it had particular application to salary management?

Apparently a good joke can pay off. In simulations conducted by Todd J. Thorsteinson of the University of Idaho (featured in this month’s Harvard Business Review magazine and in a recent HBR Daily Stat), job candidates who jokingly requested ridiculously high salaries received offers that were 9 percent higher than candidates who made no such jokes.

Thorsteinson’s research found that introducing a high anchor – even an implausibly high one – into salary negotiations influences the ultimate outcome: the salary offer.

What can we take away from this?

Well, I wouldn’t suggest trying this in reverse. You’re not likely to score points in a salary conversation with a employee or job candidate by introducing a ridiculously low salary – no matter how brilliant your sense of comic timing and delivery.

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It should, however, reinforce for us how sensitive pay discussions can be to context and expectation setting. And remind us of the importance of careful preparation (no winging it) for these conversations.

Come see Ann Bares talk about A Look at How We Reward the Work of  Today — and Tomorrow at TLNT’s Transform conference in Austin, TX Feb. 26-28, 2012. Click here for more information on attending this event. 

This was originally published on Ann Bares’ Compensation Force blog.

Ann Bares is the Managing Partner of Altura Consulting Group. She has over 20 years of experience consulting in compensation and performance management and has worked with a variety of organizations in auditing, designing and implementing executive compensation plans, base salary structures, variable and incentive compensation programs, sales compensation programs, and performance management systems.

Her clients have included public and privately held businesses, both for-profit and not-for-profit organizations, early stage entrepreneurial organizations and larger established companies. Ann also teaches at the University of Minnesota and Concordia University.

Contact her at abares@alturaconsultinggroup.com.


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