If you are uncomfortable asking for money, it may be partly because you aren’t sure how to show your value. Most people make the mistake of seeing their pay as an indication of how much the company values them personally, which turns the discussion of compensation into a painful assessment of their self-worth. But if you can think of “yourself” as separate from the value you provide your organization, it’s easier to take a realistic look at your work and present a solid case for a raise.
Companies invest in things they expect to get value from, and value can ultimately be measured in terms of increasing revenue or reducing costs. If you want to build a case for a raise, you first need to think of your work in terms of how what you do every day provides value to the organization.
Here are some common mistakes you want to avoid, along with a process you can use to build a solid case for yourself.
What NOT to Do:
- Ask for a raise because you need more money. It may be true, but it can also imply that you don’t manage your money well, or that you have a sense of entitlement – you are making it about you and not the organization.
- Ask for a raise because you work so hard. This may also be true, but it puts more focus on your “hours in” than “results out”, and this approach could backfire if you are putting in higher than average hours at work, while getting lower than average results. There are many people in organizations who work long hours but do not use their time effectively.
- Ask for a raise because you’ve spent time training or getting a new degree. While doing the work to get educated is commendable, the organization is usually more interested in how you’ve changed from your education. How do you think differently? What can you do for them now that you couldn’t do for them before?
- Ask for a raise because you just landed a big deal or had one big success after a dry streak. Better to show a string of consistent successes, even if they are smaller, and show potential to continue this behavior in the future.
- Ask for a promotion because you have been there longer than someone else who just got promoted. Maybe they learned faster, were the right fit for something that was needed, or showed value quicker. Don’t take it personally but learn from it.
What to do Instead:
Here is a step by step process you can use to think through the actual value you provide the company:
- Write a list of “proudest moments”. Think of times in the past year when you have felt proud of yourself at work. Try to think of ten times – they don’t have to be anything big – just times you’ve felt good about the work you did.
- For each of the “moments” you listed answer the following questions:
Situation: What was the situation you were in?
Goal: What were you trying to accomplish?
Action: What did you think / what did you do? (if you were a part of a team, what was your role?)
Result: What happened as a result of what you (and the team) did?
Impact: What was impact of that result on the organization?
Value: What value did the impact have to the organization? (if you can monetize it, even better)
- You don’t have to be exact in monetizing the value of what you do – but if you can estimate it and come up with a number that is far more than three times the salary you are targeting, you will have something compelling to bring to the table.
Some people get really overwhelmed when they think of trying to “monetize” the value of everything they do. Try not to let this worry you. Managers don’t always need to see dollars and cents – they just need to get a sense of how your work makes a positive difference for the organization as a whole. Just going through the thinking process and writing down what you come up with is pretty powerful.
Here are some examples:
|Situation / Goal
|Impact / Value
|Completed Amy’s Performance Review
|Discussed her progress, career path, strengths, and areas to improve. Amy has more clarity about where she can add value, and she feels positive about her potential here.
|In her role she touches many internal customers, so her ongoing work improvements and positive interactions enable everyone on the team to get better results.
|Completed and Filed our Quality Reports
|Spent several days running tests, then compiled the results, checking for accuracy. They are now filed and show the exemplary job we did insuring the quality and reliability of our products.
|If any issues arise in the future, our test results will be easy to find, and will clearly show how thorough we were. This provides peace of mind, not only in terms of risk management but also gives our salespeople more confidence in selling our solution.
|Cleaned the Bathroom
|Three times per day checked all bathrooms, restocked supplies, and wiped up spills and messes.
|Provides a positive experience for all employees and visitors and contributes to our image as an organization who cares about quality and attention to detail.
Even though the examples above are not directly related to the bottom line and are not easy to monetize, what is written in the third column conveys a sense of value. In fact, if you complete ten examples from your own position and read down the third column, notice how much better you feel about yourself!
Going through this thinking process and walking into your salary negotiation with a list of examples is in itself a powerful negotiating tool because it shows your manager that you are thinking of everything you do in terms of the value it provides the organization.
This way of thinking helps you prioritize and execute your work in line with organizational values and makes you more effective overall as a team member. It also shows the organization your personal commitment to providing value and sets an expectation that you will continue to increase your value as you discover more ways to provide it.