This is one of the toughest interview questions you could get in an interview.

While the answer is simple from the technical standpoint, you could list other companies you have visited without having to think too hard, a smart response requires a careful balancing act. Do you tell names? What if those names are impressive, like Google, Facebook or McKinsey? What do you do if the question comes from  the only company you are interviewing with?

On the one hand, you want to be helpful and open when answering tough interview questions like this one. On the other hand, details of companies and positions you are considering are proprietary information.

How do you respond to tough interview questions in a way that makes you look valuable and in demand, does not sabotage your interviewing process with the other companies and retains your leverage in salary negotiations?

Let’s start by considering why hiring managers ask this question in the first place. There are three big-picture reasons.

1. To gauge their own timeline.

Your hiring manager may want to know where in the hiring process you are with other companies, so that they can speed up the decision-making process on their end if necessary. They also may not want to invest much more time into your candidacy if they sense that you are close to accepting an offer elsewhere (particularly if they were not all that keen on you to begin with).

2. To assess the supply and demand in the market.

The hiring manager may be asking this tough interview question to try to get a sense for how many similar positions are open right now. That can impact the economics of the offer – in your favor, or in favor of the company.

3. To get a sense for your popularity.

Sometimes, hiring managers like to get external confirmation that you are a valuable and in-demand candidate. This may not make logical sense – after all, if they are interviewing you, there must be something about your background they like! And yet, sometimes they want to hear it from other companies.

So, what is your best strategy for answering these tough interview questions? Here is how I would structure my response:

Step 1: Showcase your consistency and marketability.

If you are actively interviewing within the industry, consider a variation on this:

“I am in various stages of interviewing at several large and mid-sized companies within the industry. I want to choose a position where my experience and expertise will be an immediate asset to the company.”

If you are interviewing across industries, share a common theme. That will help you appear focused in your search. Try an answer like this:

“I am interviewing at several mid-sized firms. The common thread for all the positions I am considering is a focus on collaboration (or customer service, or a technology that is a strong suit for you).”

If you are close to an offer, consider this:

“I am in a serious conversation with one other company, and am expecting an offer from them within the week.” Keep in mind that this can either work in your favor (by speeding up the offer), or it can lead the company to give up on your candidacy.

If you are only interviewing at one company, I recommend reframing it:

“I am in the beginning stages of the job search. I am attracted to positions that require exceptional communication skills. In fact, what I like most about this opening is …”

Step 2: Speak to your choice criteria.

No matter where you are in the hiring process, offer insight into how you would make the ultimate decision. Try an answer like these:

“I am excited to accept a position where I would be able to use my analytical and Six Sigma expertise to build a process flow that reduces errors and produces results."

“I look forward to working at a company that is facing a difficult challenge. I am energized by big goals, and your company’s mission of delivering exceptional healthcare to people from all socioeconomic backgrounds has me excited.”

Step 3: Highlight why this position is a top choice for you.

Most hiring managers will understand that you are interviewing at multiple companies to explore your options. However, they want to hear a confirmation that you are genuinely excited about their opening. Focus on something you appreciate about this particular position, and articulate that.

“Based on what I have learned about this position, I particularly like that I will be able to add value right away if I am hired. I have demonstrated a strong track record of process improvement, with reducing errors by as much as 98%. I am excited about creating similar results at your company, and supporting your growth efforts.”

As you think through applying those three steps to your specific situation, here is some additional big-picture guidance:

Tell the truth.

I understand that you want to come across as being in demand, and may wish to tip the hiring manager’s hand to get a quick offer. It can be tempting to exaggerate your progress with other companies, or even lie about offers.

Whatever you do when answering tough interview questions, tell the truth. This is a small world. Let’s say you are interviewing at Company A, and you tell them that you have an offer from Company B (when in fact you have only been through the first round of interviews there). What you may not know is that hiring manager from Company A personally knows his counterpart at Company B. One quick phone call or email can destroy any reputation you may have built at both companies, sabotaging your prospects.

Or, let’s say you use imaginary progress at Company B as leverage to speed up the decision making process at Company A. Nothing prevents the hiring manager from filing your statement away, and asking you a week later whether you have received an offer from Company B. That leaves you scrambling to explain why there is no offer yet, or making one up.

Be careful about what details you disclose.

Remember that when answering tough interview questions, you do not have to disclose any details that you would rather keep private. Some companies keep offers, and even openings, confidential in order to retain a competitive edge. If the hiring manager pushes you to put all your cards on the table, try a variation on this:

“My preference is to keep the details of interviews and offers confidential. I will do the same for this conversation, out of respect for your proprietary business plans.”

In a rare situation, the hiring manager may pressure you to reveal the details by saying that withholding the information will damage your candidacy. Feel free to re-state that the information is private, and if the company chooses to disqualify you for that, it is their choice. If they actually drop your candidacy because of this, get yourself a treat and count your blessings – you could have ended up working for them!

If you choose to open up about details when answering tough interview questions, be strategic. When answering the question at Company A, be careful about gushing that the culture at Company B is a fantastic fit for your personality and working style.

And above all, keep your calm.

Hiring managers can get demanding about getting names, position titles and offer details. Remember that you don’t have to disclose any of that when answering tough interview questions. If a company starts its relationship with you by threatening and bullying you into disclosing the details that you would rather keep private, it won’t get better after you are hired. Use this as an early indicator, and look for a different opportunity where interactions are based on respect and professionalism.

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