How to Ask for a Raise
A typical employer is constantly looking at the business and deciding what he or she can and can't do and what the business can and can't spend money on. Sometimes, it's difficult for employees to understand why their employer won’t upgrade their tools that are used for work purposes. For example, they wonder why they should have to continue using the older version of an iPhone for their work phone, rather than the newest iPhone version. It has a lot to do with the employer wanting to avoid unnecessary expenses. The business owner doesn't care if the employee has the newest iPhone. An employer only cares whether employees have an iPhone that serves work purposes, enabling them to fulfill their job responsibilities.
This perspective should help you to understand where business leaders are coming from A book about this that may add to it is WHO
Planning for Raises
A lot of financial decisions an employer makes concern employee raises. For example, does the business owner hire someone new versus giving an existing employee a raise and additional job duties? Should the business increase the per hour service rates charged to customers in order to cover increased payroll costs incurred due to raises?
An employer manages raises in three basic ways.
- The employer may decide it’s time to give an across-the-board cost-of-living pay increase.
- Many employers have compensation schedules that allot raises based on the length of time an employee has worked for the company.
- The last type of raise occurs when a person requests a raise. The employer will evaluate the cost of the raise in terms of how it impacts the ability of the company to remain profitable.
The employer plans in advance for the first two types of raises - those based on cost-of-living or a compensation schedule. These raises are not based on your work, per se. However, when you want to ask for a raise, it is unplanned and must be based on your exceptional contribution to business success. The employer must evaluate your role in the company and the cost-benefit ratio of giving you a requested raise. Ideally, you want the owner in the position where he or she has been waiting for you to ask for a raise. Except in unusual circumstances, it’s fairly rare for an employer to voluntarily give an individual an unplanned raise, unless you tell the employer you need or want a raise.
An interesting book that may add to your understanding of this decision making process is Ready, Fire, Aim.
Positioning for a Raise
One option some employers choose is to give a valuable employee, like you, a one-time bonus or an extra few thousand dollars for doing a great job, all in an effort to keep you happy and avoid giving you a formal permanent raise. Permanent raises commit the business for years to the higher expense. If your employer hasn’t taken that route, or you really want a permanent wage or salary increase, then it might be time to ask for a raise. The key to getting a good and fair raise is to first analyze your position within the company. Then figure out what it will take to put yourself in a position where, if you left, the company would be placed in a troublesome situation. It's only then that you have real negotiating power.
The book to read in order to more strategically get yourself in your a powerful position at the company is Linchpin.
A scheduled two percent raise, like that mentioned earlier, is not what we're talking about. We're talking about a legitimate raise that's justified by the contributions you regularly make to the business. If you're able to streamline or eliminate some work currently performed by one of the company partners or absorb additional job responsibilities in your department or function, then you have justified an increase in payroll expense because there's an opportunity cost associated with the partner’s time and in helping a department or function meet goals. The partner can now invest his or her time somewhere else, and the department or function is better able to get work done with fewer issues.
To position yourself for a raise, don’t focus on achieving the responsibilities that you currently have in terms of your job. Willingly expand the responsibilities you have
, taking the weight off of the shoulders of leaders. However, at the same time, make it continually known to the right people that you will be asking for a raise for taking on an extra workload or bringing value to the business in other ways. Your employer needs to be fully aware and reminded of all the additional work that you're doing and how beneficial it's been for everybody because you're doing it.
The worst thing you can do is ask to sit in a meeting to learn. You need to be asking: "what can I do to help." Action = Value. The book Hey Whipple Squeeze This
talks about this specific point perfectly. Business leaders care about what you produce. Say that to yourself over and over.
For example, if you are an account manager or project manager in charge of specific programs or projects, you can expand on what you’re offering the team. You might develop new software or take responsibility for the software tool that's used to organize all the tasks or monitor the metrics used to measure project progress.
A legendary book about how to make yourself indispensable (which is really what we're talking about) is How To Win Friends & Influence People
You can organize information or data analytics and present the results in a concise way to increase visibility of successes. You could make suggestions about things that could be improved, with ideas to improve them, within a services or product line, department process, marketing or sales effort or anything else that has the potential to create more value for the business. While creating business value, you are also increasing your value as an employee.
It’s important to keep focus on taking action to solve problems and not just making recommendations for solutions, i.e. build the Excel spreadsheet to improve efficiency or take steps to implement your new ideas. In that way, when you have the next meeting with your manager(s), you can show them your achievements. It’s tangible proof of your effort and contributions to the business. The next time the decision-makers discuss you, it won't concern whether or not you deserve a raise. It’ll be about all your amazing accomplishments. Chances are you’ll be seen as an employee ready for more responsibility, and more responsibility deserves a raise.
You can also ask for a raise and more responsibility at the same time, rather than taking on additional duties voluntarily without a raise. There's nothing wrong with that. It’s okay to want a change in your day-to-day activities or to want to experience things that are new or to just want to prove you can handle more than your current job requires. If this is your chosen strategy, you have to make sure that you're in a position to say, “Look how valuable I am. I deserve more responsibility.” That won't be your direct vocalized phrasing, but it's certainly the message you want to send.
Employers want to work with winners. To see what those characteristics include read the book Winners
.Your company must understand it would be in a difficult situation if you left.
Normally, it's not until you start going above and beyond, building excellence at presenting the solutions to problems and giving the ultimate decision makers options, that an employer will begin to take a step back and reconsider your value to the company. You have to do some groundwork rather than just saying, “I want more responsibility and more money.” Even if you say that, the employer is likely to say, “Try this new project, and we will see how it goes. If you do well, we will discuss additional compensation.”
Increasing Your Value as an Employee
If you step up voluntarily and assume more responsibility, your employer becomes less worried about controlling you and begins to rely on and trust you more. This is essentially your end goal for getting a raise. You put yourself in a position where a manager or supervisor doesn’t need to closely supervise you and understands that, should you leave, it would be very difficult for other people to absorb all the work that you're doing. This is the power of job autonomy. When you prove you can work without direct supervision and are good at solving problems or achieving other results, your value as an employee skyrockets.
Proving your value leads to the right time to ask for a raise because your employer is on the defensive, rather than the offensive. If they lose you, it's going to be a challenge to get the work done, so you've got leverage. There's nothing wrong with you considering what would happen to the business if you leave and taking advantage of that to put yourself in a better position. Nothing wrong with that at all. It's the point of business.
Look Out for Your Own Interests
Looking out for your own interests is the only way to get what you want. So try to put yourself first and say, “Now's my opportune moment to get a raise, regardless if it's the right time for the company.” You'll need to make sure that when you do this, you're ready to give your manager an ultimatum or at least make it feel that way because that's the only way you're really going to get the raise. If you simply say without explanation, “I want to raise,” the employer could easily just say, “OK, great, thanks for telling me,” and that's the end of the conversation. If you've established credibility and independence, and done a good job consistently of going above and beyond with actions that have led to better business productivity, your employer is likely to give you a raise.
Put yourself in a position where you can say, “These are the things I've done that deserve a raise, and this is what I'm going to do if I get the raise.” If working to get into the right position to ask for a raise, you can say you would like to take more responsibility in some manner or be in charge of this or that. Explain the reasons you are qualified and ready to assume a new responsibility. Then it becomes an interesting discussion internally because leadership will need to decide if they are willing to potentially see you explore other opportunities for employment, forcing the company to start from scratch by hiring a new employee as a replacement. The employer must decide if it’s wise to be willing to let you go, or if it’s better to give you the raise to keep you and the business moving forward.
We could talk more about phrasing and how to actually ask for that raise, but you need to make sure that you're in a position of leverage first. Otherwise, there's no reason for the employer to give you an unplanned raise. You need to be indispensable, and take on responsibilities that will make the lives of managers easier. Bottom line: You'll deserve more money because management cannot afford to lose you.