How Black America 2.0 Uses Leverage in Negotiations

If you’ve read our recent articles, you notice a repeating theme: How brothas and sistas can leverage their power more effectively than we have before. Without getting into the dictionary definition of the word “leverage,” let’s just say leverage is where you put yourself in a position to get the best outcome for whatever deal you are negotiating. The opposite of leverage is weakness, where you place yourself in a position where you have no viable options, so you just accept whatever crumbs are handed to you. Unfortunately, Black America 1.0 has been stuck in that rut for decades. The vision for Black America 2.0 is to move us past this failed model to use a more power-based leverage model to secure a better future for our communities.

To hopefully keep this article brief, the best way to really understand how leverage works is to compare how Black America 1.0 has been doing it—using fictitious scenarios—versus how Black America 2.0 will use it. Black America 1.0 does not consistently or effectively us leverage and influence. Black America 2.0, on the other hand, has business smarts and knows how to negotiate using the leverage of options (not having all their eggs in one basket).

To represent Black America 1.0, let’s call him John (yeah, it’s actually a great name but this is fictitious, lol). For Black America21.0, we’ll call him Eric. Let’s dig into the scenario.

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Scenario: Applying for a job

You just graduated college in a STEM major and as a result, you had a lot of early interests from companies looking to hire. Starting salaries in your field are about $75,000 a year. You think you’re worth more given the interests from other companies, but are willing to take that salary since it’s more than you ever made. ABC Mega Corporation (a fictitious company) wants to interview you after meeting you at a job fair. Here’s how our two fictitious characters handle the process.

John does not bother to follow up with other companies because he feels ABC Mega Corporation will automatically have his best interests at heart. He goes to the interview with a few copies of his resume and looking pretty good in a suit. The interview seems to go well, but at the end, the company offers him $50,000 a year, which is 50% less than the average starting salary.

“Is that the best you can offer? He asks. The hiring manager nods.

“We have a good benefits package though,” he replies.

His head held a bit low, John reluctantly accepts the offer and never bothers to follow up with other companies to see if he can get more. “These people are racists,” he thought to himself, even texting one of his friends about the racists giving him less money.

Eric, on the other hand, knows his options as he did follow up with other companies, with some offering below the average while others offered more. One company floated $85,000 a year. Guess which offer he went with? So he sets up an interview and is prepared just like John was. At the end, the company liked Eric a lot, but changed the offer to $80,000, which is $5k less.

Could racism have caused this hiring manager to lower the offer, after seeing that Eric was Black when she met him in person? It’s possible, sure. Or it could have been some unforeseen mistake. We can’t make premature assumptions until we get all the facts. Should Eric simply back down and leave, never to negotiate with her because of the possibility of racism being a factor? Certainly by now you already know the answer.

Ever the negotiator with an unbothered business grin, and remembering that the original offer was for $85k, Eric asks, “I certainly appreciate the offer, but perhaps there has been some mistake? The offer before I got here was for $85k a year. Can we work together to clear up this matter?”

The hiring manager then apologizes, blaming it on a “clerical mistake.” Not only did she change it back to $85k, but also threw in a $2,000 signing bonus for the trouble. “Do you accept this modified offer? We can gladly start you this coming Monday as I am very impressed with your background.”

“Thank you very much,“ Eric smiles, shaking her hand. “Indeed, I am pleased with the offer and need a day to think it over, if that’s ok with you?” She nods in agreement.

But Eric does stop there? Of course not. Now he has LEVERAGE he can use with the other companies on his list. By buying himself a day to think it over, he can email the others to see if they can match or exceed $85k. And guess what? One of the other companies, XYZ Unlimited Corporation, comes back and, out of nowhere, boosts their offer to $90k because they just got an increase in their hiring budget for the job they offered him. Plus the benefits package is better than ABC, and he would have more of a fast track to a highly visible leadership role in 12 to 18 months.

Guess which job Eric chooses? Of course, he’s smart enough to know not to reject ABC’s offer until he gets a written offer from XYZ. But by using leverage, simply asking and negotiating with all options on the table, he got a better deal for himself that is $40k more than John’s offer. Although this is a fictitious example, I can assure you that this happens all the time as I have been using such leverage in negotiations for over 25 years now. Other seasoned business brothas and sistas reading this article can also attest to this. And I freely offer this important tip so that, not only can you improve in your employment and entrepreneurial pursuits, but also in politics, where your vote is just like money (not an emotional, blind investment with no options).

In the next installment of this series, we will cover the car dealer scenario, with two examples of how to use leverage and how not to use it.

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