Boosting Pay
The Society for Human Resource Management projects that salary budgets will increase by 3% this year. That’s a meagre increase given the tight job market and the fact that this increase is around the same as 2016.
If you adjust this increase for inflation – at around 2.1% - American workers are looking at a 0.9% increase on their pay checks. That is not comforting for workers who are facing rising energy, food and other associated costs.
To be clear some companies may or may not increase your annual salary. If they do, they set how much of an increase you get; which may be higher or lower than this year’s expected increase.
Amidst these flat figures, you could take home more this year. Of course, you can’t kick back and wait for this to happen. You will need to ask for a raise using the power of negotiation.
I will share four tips I use with my private clients when I advise them on asking for a raise.
Step1. Crunch the numbers to see how much you need
This is based purely on your unique situation. Spend some time going through your expenses, investments and other financial obligations to determine how much you need to maintain your current standard of living and meet other future financial obligations such as saving for a down payment on a house or even building up your emergency fund.
Step 2. Find out how much you are worth in the market.
The next step is to do some external research. It is always important to know what other professionals like yourself are being paid. In doing the comparison you can use parameters such as location, industry, company size, experience and credentials.
The goal is to always be at or above what others are paid in your area. Being below this will certainly affect your lifetime earnings. Use your friends, peers or even executive recruiters in this space to gather real-time intel. You can also consult sites such as Robert Half, Bureau of Labor Statistics, payscale.com, salary.com and a host of resources to gather the details on market compensation.
Step 3. Prepare your case
First things first, you must believe that you deserve a raise. So use some quiet time to reflect on why you should get a raise over your colleagues or everybody else in your unit. You will find that the decision is usually very personal. Equally important is having a compelling case to justify the raise. Here are four things to do as you prepare your case:
Decide how much you will ask for. Decide how much of a raise you’ll ask for. The goal is to get to or above market rate. Think about other broader internal factors such a salary bands or overall company/department performance as you determine how much of a raise to ask for.
Impact. Now is the time to start thinking about the 2 or 3 things you accomplished for your company or team over the last couple of months. It shows that you have it in you and you have more to come.
What you’ll do in the future. Often times when we ask for a raise we only focus on what we accomplished; however, you want to put yourself in your boss’s shoes and demonstrate to him how you are going to make his life easier in the future. Think very concrete here. Perhaps it’s a big stretch project or assignment you will complete. Have something that speaks to how you will deliver in the future.
Anticipate objections. Those who are most successful at negotiations tend to spend time trying to anticipate objections and have potential alternatives in place. A client of mine once asked for a raise but didn’t get the raise right away. He had anticipated a no so instead of walking away at that point, he asked that the company pay for a professional certification he was about to pursue and provide a daily lunch allowance (he worked remotely). That was more money back in his pocket, which he dedicated to other financial goals. Get creative when you propose solutions to possible objections.
Step 4. Ask your boss for the raise
The final step is owning the conversation with your boss about your raise. I recommend having this conversation as early as possible. Do it before you set your performance objectives (or right after) but not at the same time. Some quick tips in getting this done:
Schedule the conversation. Send your boss a quick email asking to set aside some time to talk and agenda of what you would like to cover in the discussion.
Practice your pitch. Practice over and over what you will say when you ask your boss for a raise. It’s important to focus on what you plan to deliver in the future and a subjective reason as to why you deserve a raise.
Use tentative language during the conversation. Research has shown that those who are collaborative in negotiations tend to walk away with better deals (they usually have win-win situations for both sides and manage to preserve the relationship). It’s as simple as using language such as ‘how might we make this raise possible’ instead of ‘you must give me a raise.’
If you hear no. If your boss says no to your request, first seek to understand why he is unable to approve your request at this time. Then work with him to revisit this ask in a couple of months. You might also want to a little trading here e.g. working from home once per week, getting a lunch allowance (if you work remotely) or having the company invest in your professional development to name a few things. Think about what else might be possible for you.
Let 2017 be the year when you increase your pay. The economic forecasts for salary raises are dim; you will have to take control of asking for more money. It starts with figuring out your ideal number and evaluating that against what you are currently worth in the market. Prepare a substantive case that emphasizes your ability to deliver results in the future. Good luck as you make the ask!
I’d love to hear from you. What other strategies have you used to ask for a raise?
