From Residency to RealityFrom Residency to Reality

Your Future Practice: Your Future Practice: Options & OpportunitiesOptions & Opportunities

AAFP Practice Management AAFP Practice Management Teaching Tools, Series ITeaching Tools, Series I

Session Session D-1D-1

Practice OptionsPractice Options

How to Negotiate anHow to Negotiate an Employment Contract Employment Contract

Tricks, Traps,Tricks, Traps, & Techniques & Techniques

Becoming an Effective Negotiator

Note: Negotiating 101 is Note: Negotiating 101 is notnot a required a required course in most U.S. medical schools.course in most U.S. medical schools.

Before You Negotiate

Who are the Who are the decision-makers?decision-makers?

What background What background information have information have they given you? they given you?

What are their What are their key interests in key interests in negotiation?negotiation?

Before You Negotiate

What additional What additional information could information could you you legitimatelylegitimately obtain from obtain from outside sources?outside sources?

Opening the NegotiationsOpening the Negotiations

Defining your interests Defining your interests and their interests and their interests

Finding areas of Finding areas of mutualmutual interest interestAffirming key principles and values to be Affirming key principles and values to be

honored in the negotiationshonored in the negotiationsAgreeing on the negotiating process (Agreeing on the negotiating process (who, who,

what, when, where, and howwhat, when, where, and how))

The Middle Game: In the Heat of NegotiationsThe Middle Game: In the Heat of Negotiations

Stick to your negotiating principlesStick to your negotiating principles Be collaborative, but watch out for Be collaborative, but watch out for youryour own own

interests (they’ll watch out for their own). interests (they’ll watch out for their own). If the variables are shifting, keep yourIf the variables are shifting, keep your

eye on the bottom line. eye on the bottom line.

The Middle Game: In the Heat of NegotiationsThe Middle Game: In the Heat of Negotiations

Key Concepts:Key Concepts:

Principles & Priorities Principles & Priorities Anchors & TargetsAnchors & TargetsUpper & Lower LimitsUpper & Lower LimitsBATNA & “walk-away”BATNA & “walk-away”

The Middle Game: In the Heat of NegotiationsThe Middle Game: In the Heat of Negotiations

Don’tDon’t Don’t talk more than Don’t talk more than

you listen.you listen. Don’t legitimize a bad offer Don’t legitimize a bad offer

with a counter-offer.with a counter-offer. Don’t give out your best and Don’t give out your best and

final offer prematurely.final offer prematurely. Don’t make an ultimatum.Don’t make an ultimatum. Don’t burn any bridges -- Don’t burn any bridges --

you may negotiate with you may negotiate with these folks again someday.these folks again someday.

DoDo Select your opening bid Select your opening bid

carefully (modestly high, carefully (modestly high, but not outrageous)but not outrageous)

Bring written materials Bring written materials to support your position to support your position (MGMA income surveys)(MGMA income surveys)

Know your “walk-away” Know your “walk-away” (BATNA) position(BATNA) position

Have alternative or Have alternative or competing offers in mindcompeting offers in mind

The Middle Game: In the Heat of NegotiationsThe Middle Game: In the Heat of Negotiations

Monitor Your Emotions:Monitor Your Emotions:

Angry or Frustrated?Angry or Frustrated?Too Eager?Too Eager?Insecure?Insecure?

The End Game: Coming to ClosureThe End Game: Coming to Closure

ABC -- always be closingABC -- always be closingWhat further information could I provide

to help you make your decision?When will the board ( search committee,

etc.) meet to make their final decision?When should I tell my spouse (partner,

friends, other potential employers) that we will be able to come to a final decision?

The End Game: Coming to ClosureThe End Game: Coming to Closure

NBD -- never be desperate.NBD -- never be desperate. Make your initial commitment conditional. Make your initial commitment conditional.

(the contract looks okay to me, but I just need to run it (the contract looks okay to me, but I just need to run it by my lawyer, accountant, spouse, mentor, etc.)by my lawyer, accountant, spouse, mentor, etc.)

Keep your “walk-away” options open until Keep your “walk-away” options open until both parties have signed the contract. both parties have signed the contract.

Otherwise you’ve lost your bargaining power -- you Otherwise you’ve lost your bargaining power -- you have no option but to accept any last-minute changes have no option but to accept any last-minute changes they demand.they demand.

Negotiating Tricks & Traps Negotiating Tricks & Traps

Ambiguous AuthorityAmbiguous Authority I’m I’m suresure my partners will my partners will

be be happyhappy to cover for you to cover for you when your baby’s born.when your baby’s born.

Adapted from “Getting to Yes: Negotiating Agreement without Giving In” (Authors, Roger Fisher and William Ury)

Negotiating Tricks & Traps Negotiating Tricks & Traps

Watch out for last-minute Watch out for last-minute deal changes deal changes

(one little thing -- we (one little thing -- we had to go with the 5-mile no-had to go with the 5-mile no-compete clause after all; that’s compete clause after all; that’s not a real problem,not a real problem,is it?)is it?)

Adapted from “Getting to Yes: Negotiating Agreement without Giving In” (Authors, Roger Fisher and William Ury)

Negotiating Tricks & Traps Negotiating Tricks & Traps

Dubious IntentionsDubious Intentions After two years you can buy After two years you can buy

into the practice -- I’ll be into the practice -- I’ll be retiring soon, and this will retiring soon, and this will all be yours!all be yours!

Adapted from “Getting to Yes: Negotiating Agreement without Giving In” (Authors, Roger Fisher and William Ury)

Negotiating Tricks & Traps Negotiating Tricks & Traps

Phony FactsPhony Facts Even without a guarantee Even without a guarantee

you’ll make $200,000 in you’ll make $200,000 in your first year -- EASY!your first year -- EASY!

Adapted from “Getting to Yes: Negotiating Agreement without Giving In” (Authors, Roger Fisher and William Ury)

Negotiating Tricks & Traps Negotiating Tricks & Traps

Good Guy / Bad Guy Good Guy / Bad Guy I’d offer you more, but my I’d offer you more, but my

partner is pretty partner is pretty conservative; Let’s just get conservative; Let’s just get you here and once he gets you here and once he gets comfortable with you we comfortable with you we can re-look at things. can re-look at things.

Adapted from “Getting to Yes: Negotiating Agreement without Giving In” (Authors, Roger Fisher and William Ury)

Negotiating Tricks & Traps Negotiating Tricks & Traps

Less than full disclosureLess than full disclosure Once this new kid gets here Once this new kid gets here

we can offer evening and we can offer evening and Saturday hours and open Saturday hours and open that satellite clinic we’ve that satellite clinic we’ve been thinking about. been thinking about.

Adapted from “Getting to Yes: Negotiating Agreement without Giving In” (Authors, Roger Fisher and William Ury)

Negotiating Tricks & Traps Negotiating Tricks & Traps

Dubious DelaysDubious Delays Since you’re asking for Since you’re asking for

more than our standard more than our standard salary I’ll have to take it to salary I’ll have to take it to the PHO board -- they meet the PHO board -- they meet again in June. When did again in June. When did you say you want to start you say you want to start work?work?

Adapted from “Getting to Yes: Negotiating Agreement without Giving In” (Authors, Roger Fisher and William Ury)

Negotiating Tricks & Traps Negotiating Tricks & Traps

The Standard ContractThe Standard Contract Everybody signs it!Everybody signs it! If we changed it for you, If we changed it for you,

we’d have to change it we’d have to change it for all the doctors. for all the doctors.

Gee, nobody ever questionedGee, nobody ever questioned it before. it before.

You don’t need a lawyer.You don’t need a lawyer. Don’t you trust us?Don’t you trust us?

Adapted from “Getting to Yes: Negotiating Agreement without Giving In” (Authors, Roger Fisher and William Ury)

Final thoughtsFinal thoughts

Remember -- it’s Remember -- it’s not just about money.not just about money. Did you get the job you Did you get the job you

wanted? wanted? Are these the colleagues Are these the colleagues

you want to work with?you want to work with? Did you maintain your Did you maintain your

personal values and personal values and priorities? priorities?