April 13, 2013 David Morin

Why Pay Raise Advice Can Destroy Your Career

During my years as a founding CEO of a growing company with many emerging career opportunities, I met a lot of enormously talented and hardworking people. With time, many of them got pay raises. But one thing amazed me – and scared me. Those employees who were not qualifying for a raise didn’t seem to understand why.

In this article, I will share insight on this from a CEO’s point of view, including what you should do to be the one your boss wants to give a raise (and how to not be the one who has to leave the company on the salary negotiation meeting).

War-Tactics

There are many articles out there filled with advice on how to negotiate salary. Some contain suggestions such as threatening to leave your company, write lists on every value-providing activity that you contribute, and to basically do whatever it takes to force your boss into signing a contract on future raises. The idea is that through driving the boss into a corner, you will force him to pay more to avoid other larger economical loss. This is an old mindset, developed by the German philosopher Karl Marx, who thought that the society had to progress through the continuous struggle between employers and employees. These are war tactics – and employing them will hurt your career.

You may succeed at forcing your boss to give you a raise. That’s why it’s grown to be pretty common advice. But as a result, what then happens with your future career opportunities in that company?

Instead of war, think we.

We-Tactics

By the end of the day, you and your boss are just two human beings working hard towards the same goals. What if you could act in a collaborative way even when it comes to negotiating your pay raise?

1. Shift Perspective & Make Friends

First, you need to be aware that supervisors are people you can actually make good friends with. Even if you never will pig out on Ben & Jerry’s in a TV-sofa together, you will benefit from developing a close, professional relationship from the start. This will build trust between you, thereby fostering a more organic rapport which will make him/her appreciate you and actually want to recognize your efforts and reward you with raises and other perks. To help shift your perspective, picture your boss having the same dreams, hopes and fears as you do.

On breaks and after work, make sure you get to know each other. Talk about families, interests and hobbies. Perhaps you have something in common – a hobby, favorite sport, musical genre? Delve into that. Obviously, adjust your communication to your boss’s personality and don’t get too personal too fast.

2. Talk Money

Many people think that they shouldn’t talk about promotions and salary increases until after at least one year of employment. I say: Bring those subjects up at the first interview, but do it in the right way. Make it crystal clear that you want to earn a lot of money and that in order for that to happen, you understand you must first create a lot of value for your company. Ask exactly what it is you have to do to achieve this, and thereby gain future raises. Your boss will love that kind of ambition.

3. Walk the Talk

Before you ever mention a raise again after that initial time, make sure you perform as well or preferably better than necessary to qualify. For my advice to work, your performance needs to be no less than excellent. This is the most time consuming part of the process. Even though it can be an arduous journey, there are no shortcuts.

4. Work Together

Instead of viewing your job as a place where you slave away putting in endless hours of your life, picture it as a place where you work hard alongside your boss towards common goals. Show interest in these goals by asking about them, studying them and discussing them. Make the company’s interest your interest.

5. Keep Other Doors Open

One of the most common mistakes people make in their career is that they stop looking for jobs just as soon as they get one. Continue to occasionally watch the career sites. If you find something really interesting, invest a minute and send in your application. Over the course of a year, chances are you will receive a number of interesting offers. You can decline them all as long as you enjoy and prefer your current job. But keep track of the offers you receive; they indicate your chances on the job market. We’ll revisit this soon.

6. What’s Your Value?

Business is about numbers. You have a job because someone hopes that in the long run, you will generate more money for the company than what you cost. Simply put, you’ll be a great asset rather than a disappointing liability. Believe me, you won’t get a raise because you think you deserve it or need it. You get one when it’s the wisest business decision for your employer.

The equation looks something like this:

(Your Value to the Company – Your Cost’s Total + Your Position Rehiring Cost’s Total = Salary Raise Opportunity)

Of course these numbers are difficult to get exactly right – even management struggles with these kinds of equations. Rather than trying to figure out your exact return for the company, just remember this equation. It will help you to understand how your boss makes decisions.

7. Time to Meet

When you have followed these steps, arrange a meeting – preferably immediately after you have reached a milestone or an important goal. If you’ve done your homework, this will be the easy part.

Tell your boss you would like to meet and discuss your salary. During the meeting, remember to maintain a friendly, non-confrontational attitude. You can check out our guide on how to how to be more friendly here. Keep things simple. There are no “magic” words. The hard work has already been done. Start off by saying something like:

– I have accomplished [ALL THE ACCOMPLISHMENTS THAT MAKE YOU QUALIFY FOR A RAISE]. I would therefore like to discuss a raise. 

Then pay attention to the reaction you receive. Is your boss hesitating? Or don’t you get the raise you were hoping for?  If that’s the case, I would then say something along the lines of:

-I’ve received offers from [THE COMPANIES YOU GOT AN OFFER FROM] during my employment here. I have declined them all because I much prefer working here. And I feel that you and I connect well, too. But as you know, money is an important factor in anyone’s motivation and it’s one I must consider carefully, especially when I notice other companies are offering me jobs. Can we agree upon [THE DOLLAR AMOUNT OF SALARY YOU WANT)?

This way, you show that your employer risks losing you if you are dissatisfied. And you don’t have to risk leaving the company just because you can’t come to terms.

One more thing: Don’t make offers up. Employees often call each other and check out such things.

The key takeaway of increasing your salary – in addition to providing exceptional work – is to establish clear communication from the start; building a relationship with your boss; and making sure your numbers add up. Good luck, and don’t forget to send me an email once you get that raise so I can offer you my congratulations!

Comments (2)

    • David Morin

      Hi Hannah! By this I refer to the total costs involved in hiring for a specific position

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