The do’s and don’ts of negotiating a raise

Successfully negotiating a raise is as much art as science. Here’s what to do and what to avoid.

The do’s and don’ts of negotiating a raise
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Salary's not the most important aspect of a job, but it can make a difference in your overall satisfaction and engagement. Because dissatisfied employees leave and disengaged employees end up costing their employers money, employers may be more amenable to giving you a raise than you might think — especially in a tight tech hiring market.  

The keys to managing the tricky, nerve-wracking process of negotiating a raise are preparation and a keen understanding of your organization’s performance, culture and market conditions. It’s also vital to know your company’s and your manager’s needs — and to keep a cool head in negotiations.

The following tips will help prepare you for this challenging opportunity, thereby increasing your chances of receiving the raise you deserve.

Do: Track accomplishments

If you feel a raise is in order, the first step is to track your accomplishments on a regular basis in an achievements journal, where you note major projects and successes, or an itemized spreadsheet or calendar, says Elaine Varelas, managing partner at Keystone Partners.

"At the beginning or end of each week, review the meetings, appointments and projects you were involved in, and summarize them in two or three concise, resume-style bullets,” Varelas says. “These documents will serve you well at review time, as you review your annual goals, and will also help you make sure you are moving your agenda forward."

Over time, these accomplishment documents add up to tangible evidence of your business value, and can help quantify your value to the company based on metrics and outcomes that are most important for your organization, she says.

"Every role can be quantified by some calculation: number of customers served, money saved, revenue generated, mishaps avoided, speed increased, satisfaction survey ratings increased," Varelas says. “Challenging yourself to do this will help you identify your value to the company and ensure you are compensated accordingly.”

Do: Know your worth

Objective research is another major factor in successfully negotiating a raise, says Michelle Joseph, CEO of PeopleFoundry. Know how your current geographic location, the cost of living in your area and the specifics of your role affect your current and proposed salary.

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“Make sure the current and proposed salary for your role, in your specific region, with your qualifications, are in line with what others get paid by using sites like Salary.com or Glassdoor.com," Joseph says.

Glassdoor.com's Know Your Worth salary calculator, for example, aims to give an accurate read on how your pay stacks up against others in the same industry, role and with the same levels of experience — but it's not gospel. Be sure to do your own research and understand there may be company-specific factors that can influence pay rates.

"Make sure you understand the going market rate for the position you want within a range, and take into account the external factors that can affect that range,” says Lydia Frank, vice president of content strategy at PayScale.com. “Where's the position located? How many years of experience do you have? What's the size of the company? What's their financial state? What industry do you work in? Taking into account these factors gives you a pretty realistic read of salary range, and then you can walk in with confidence and facts to back up your assertions."

"If you have a salary in mind that you think is fair based on your value and your research, put your target salary number a bit higher than that — but nothing completely over-the-top,” Joseph adds. “Hopefully, the final number agreed on will wind up being your initial target."

Do: Consider your company’s context

Research your company to identify possible obstacles that may stand in your way of a raise. Obstacles may include a recent layoff or cost-cutting measure. If you do identify barriers, let your boss know that you are aware of these challenges and ask her how you might play a role in solving some of the problems.

Your mission and purpose in a raise negotiation is to fulfill your employer’s business needs and objectives. Every decision you make in the negotiation process should be focused on helping your employer see that giving you a raise or promotion will further her business interests. For example, if you have found through your research and conversations with your manager that she is concerned about challenges related to outsourcing, you can explain how your expertise in, say, knowledge sharing or running IT as a separate business unit will help her with those challenges.

Do: Use your advantage

Negotiating a raise at your current company gives you a built-in advantage, as your boss should already be well aware of your contributions, achievements and your strengths, Joseph says. If they aren't, now is the time to show them by revealing your accomplishments and demonstrating how they impacted the company's success.

"Tangible examples of previous projects are good, but quantifiable examples are better. Ideally, prove how much money you've saved the company, how much money you've made the company, or how many man-hours you saved,” Joseph says.

If you’re a star on your team and are nervous about asking for a raise, know that your boss would rather you ask for one than stew silently and pursue other opportunities, says Mark E. Berger, owner at Swat Recruiting.

“No one wants a top employee looking for a raise elsewhere. Don’t bottle things up inside and don’t be afraid to ask,” he says. “If you feel you really deserve a raise, and have the evidence to back it up, just do it.”

Do: Consider bonuses and other options

There are other options to consider when negotiating, such as stock, executive benefits, flex time, increased vacation time, and bonuses.

"Bonus incentives can be great for both parties because it allows for a system of checks and balances — the harder you work and the more you accomplish, the higher your year-end bonus, while the company benefits from your increased efforts," Varelas says.

Other solutions might include a tiered raise over time, scheduling another review in three months or negotiating additional vacation time, says Allison Hutton, chief talent officer at Allavanti Group. “Think of things they may have the ability to give you instead of money. Coming up with alternatives is usually viewed as positive.”

Do: Embrace ‘no’

Many people find negotiation difficult because of a desire to please, as we have been taught that win-win is the best possible result. But a consensus-based approach to negotiation causes you to focus on the outcome, which is something you cannot control.

Instead, recognize that “no” is an important word in any negotiation. You may even want to invite your manager to say no. By telling her you’re comfortable with a no answer, you put her at ease. Inviting no, hearing no and even saying no yourself can open up the conversation for real give-and-take. It tells your manager you are capable of talking rationally, puts away the need to be right, and prevents you from making bad decisions because of a need to feel safe and liked.

Do: Stay positive

If your pursuit of a raise falls short, don’t get discouraged. Sometime external factors may play a role and it’s important not to get frustrated, Hutton says. “You want your manager to be your ally, not working against you,” she says. “Understand the pressures she may be under and see if there are creative ways to work with her.”

Plus, it may still be worth staying with your company rather than looking elsewhere for a bigger paycheck, especially if your benefits package is solid, or if there's a growth opportunity that will further your career, Frank says.

"Where do you want to be a few years down the road? Don't discount a company that can't afford to give you a raise, but that will give you the best path to growth," Frank says.

"Knowing the impact you can have on an organization from what you have done in the past and the concrete measurements you have, will help you set and get the compensation you want. Every organization has average salaries. Show that you aren't an average contributor and lead the way to the best package for the highest contributions," Varelas says.

Don’t: Let emotions overwhelm you

Your overriding task as a negotiator is to replace compromise- and fear-based negotiating with decision-based negotiating. Raw, unexamined emotions never produce good agreements.

“Stay professional and calm. Passion for what you do is one thing, but once you’ve lost control of your emotions — whether it’s frustration or anger — you’re unlikely to recover,” says Jay Ferro, formerly CIO at the American Cancer Society and now chief customer officer at Rackspace.

While your request for a raise might be financially driven by circumstances at home, Kressner warns that your conversation with your boss should be strictly business. “Build your case based on your value to the organization and not an emotional appeal,” he says. “No one cares that you have a lot of bills; sell yourself on why you deserve the money you do based on your value.”

By keeping your mind clear of emotion and instead focusing on what your boss is saying, how she is saying it, what you are asking and how you are asking it, you will be way ahead of the game.

Don’t: Present your current salary/position as a problem

If you begin the conversation with a litany of complaints — you can’t support your family on what you’re making; you’ve been working for three years without a significant raise; the cost of living in your area has gone way up — you are not being emotionally neutral and your manager may make assumptions about you and your attitude. Instead, present yourself as a solution to a number of the company’s current and future challenges. Your manager will come to see that she can’t afford not to give you a raise.

Don’t: Compare yourself to others

Comparing your salary to your colleagues’ is dangerous and could potentially get you fired, says Hutton.

“Do not, under any circumstances, say, ‘I know Sally received a 3 percent increase and I work much harder than her so I should at least get 5 percent,’” she says. “It’s never okay to use that information when discussing a raise.”

Ferro echoes that sentiment. “Never make the conversation with your boss about another employee,” he says. “This is about your performance and the value that you are creating for the organization.”

Don’t: Try to impress your boss

While focusing on your accomplishments, it’s never a good idea to come off as bragging or pretentious. You want your manager to feel at ease with you. People in negotiations tend to make quick assumptions about the people with whom they’re dealing. They let their emotions (for example, arrogance) get in the way, which puts them at a disadvantage. Also, if you are trying to impress your boss, then your own emotions (such as neediness and fear) are likely to get in the way, and you won’t be focused on your language and behavior — the things you can control in the meeting.

Don’t: Give a presentation

When giving a presentation, you make assumptions about what you think your manager wants to hear. Instead, ask your manager a lot of questions so you can find out her position, issues, concerns, needs and objectives. Her answers will build a vision of what she wants, and you can tailor your response to fill her needs in a way she will eventually see that you can help her achieve that vision.

For example, ask your boss where she sees your position going in the future. How would she like to see your department develop? What are some of the biggest challenges she anticipates in terms of talent development? Her answers to these questions will help you tailor your argument for a raise.

Don’t: Try to close the deal

If you are focused on getting your employer to say yes to your raise, then you’re not likely paying attention to what’s most important: what your manager is saying. If your heart is beating fast because you feel things aren’t going your way — or the opposite, you’re starting to get excited because she seems to be coming around — you will wear your emotions on your face and spend less time ascertaining how you can be more instrumental to your company, and thus more deserving of the raise you seek.

Don’t: Give an ultimatum

Never threaten or posture with another offer or a take-it-or-leave-it stance. You may want a raise, but you’ll benefit more by treating the negotiation as a conversation in which you are interested in hearing about your manager’s problems so you can solve them.

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