Be advised — this column could be dangerous if not handled with extreme caution. One of the most delicate issues in business is compensation, especially when it comes to your own, and mishandling the matter can set you back or even cost you your job.
Moreover, amid a widening gap between the highest income earners and everyone else in the current economic landscape, you might find it frustrating to have to fight for a standard 3 to 4 percent salary increase.
So what can you do about it?
The following five steps offer you the best chances of getting a raise, while at the same time minimizing the attendant risks. If you follow them thoughtfully and sensitively, you’re likely to position yourself for a compensation increase in the short or medium term.
Here are the five steps:
1. Deserve a raise.
In order to get a raise, the most important thing to do is deserve one. Why? Under relentless pressure to satisfy insatiable investors, companies must achieve increased profitability quarter after quarter. To keep their P&Ls in fighting shape, they look for ways to eliminate all nonessential positions, through the application of technology, outsourcing, or just pushing employees ever harder.
While nearly everyone thinks he or she is performing well at work, the fact is that some are more central to the organization’s success than others. Your best protection is to make yourself as indispensable to the enterprise as possible.
More than ever, you should find a way to work on things that support how your company achieves growth and creates value. It’s incumbent upon you to know exactly how what you’re working on fits into the strategy of the company. If you don’t know, find out. If you realize your project is on the periphery, find a way to get involved in something in the center of the value-creation engine and corporate strategy.
Once you’re sure you’re working on the right things, work hard, be a team player, be positive, and take the appropriate amount of initiative.
2. Get the facts.
It’s also your responsibility to know your market value and how your compensation stacks up. You need to learn how your level, role, experience, and performance compare to the market.
To find out, talk to your company’s human resources professionals to understand the pay scales in the company. Also talk to recruiters and people from other companies in similar roles. Of course, never has so much salary information been so readily and publicly available — enter “executive compensation” in Yahoo! Search and you’ll get around 20 million results.
One easy-to-use, high-quality resource is Salary.com. This site includes a Salary Wizard feature and Career Resources center with information sorted by job type, level, ZIP code, performance, education level, and so on.
If you work in a public company, be sure to study your company’s proxy statement, where the compensation of your own top executives is detailed. This will help you understand the pot of gold toward which you’re striving so hard.
3. Talk to your boss.
Now you’re ready to have the tricky compensation conversation with your boss, and it’s imperative to be sensitive: Asking your boss for a raise is one of the most delicate conversations you can have.
It’s well known that managers find giving performance reviews anxiety-producing in the extreme. They find compensation discussions even more stressful. So make sure you have this talk in a constructive manner by putting the conversation into a broader context.
Talk about how your work fits into the company’s strategy. Discuss how you see your contribution and performance. Solicit his or her feedback. Share your findings from step 2, and ask what he or she thinks your expectations should be. Don’t be pushy, but be clear that compensation is an important part of the overall equation for you.
Make sure to communicate that there are other important dimensions as well, such as feeling that you’re making an important contribution to helping the company win; enjoying and respecting the people with whom you work; and continuously learning and growing. Your boss will almost certainly respond better when compensation is “on the list,” but not at the top of the list.
There’s one other thing to recognize, however — your boss probably feels the same way about his or her compensation that you do about yours. The ability to give you a raise is likely to be constrained by your boss’s own compensation, as well as by approved salary ranges for different employment levels. But here’s the key: If you conduct this conversation well enough, you might even be able to arm your boss with the approach to have the same discussion with his or her boss.
4. Take on a special project.
If your compensation is locked-in for 2007, and it may well be, another approach is to come up with a special project that you can offer to lead. Assuming that you now fully understand how your job and work fits into the company’s strategy, you should be able to devise a viable effort that would further support the strategy.
Suggest to your boss that you lead this special project — and if you’re successful, that you be eligible for a special performance bonus.
5. If all else fails…
If your salary is locked-in, the pot of gold isn’t all that enticing, and there’s no real opportunity to be rewarded in the way you think you deserve, then it may be time to consider looking outside the company for a different opportunity.
Obviously, this should be a last resort if you like the work you’re doing and enjoy and respect the people with whom you’re working.
By Jim Citrin