I used to have a running joke with a friend. We would bark at each other while wondering the halls:
“Your raise will become effective when you do!”
We would giggle as we’d walk away with big smiles on our face. Nothing like jabbing friends in the workplace to keep things lose.
Raises are one of the most watched moves among employees. They tend to signal many things:
Am I like everyone else? Better? Worse? By how much?
If the company had a great year, is that impacting raises? What about a terrible year?
What about my colleague, who’s in the same exact job, but making more or less?
The list goes on and on. Some people have resigned themselves to “negotiate at all costs” and whatever they are offered, fight for more. That’s one strategy (tiring for employers). Others just take what they are given, say thank you and move on (less tiring).
Both are common approaches. And both are marginal.
What if an employee came to a business leader with the following:
“I think I can find you at least $200k to the bottom line. It’s hard to get, will require significant new effort and I can lead it, maintain my day job but get you close to realizing it. If you let me lead it and we are successful, at the end of next year would you bump me up to $X?”
Lets just say that “X” is substantially more than a standard raise, 2 or 3X’s the average increase. Would the business leader do it?
Said differently, why would the leader NOT do it?
Why aren’t there a line of employees out the door begging for a chance to make real results happen, and as a result, accelerate their own compensation?
Because it’s not easy. Because the people that can actually make it happen are rare. They are the true Hustlers. And they are what great businesses are built around.
The approach most people take is to HOPE somebody recognizes your contributions. Sit back on your heels. Assume that “management” will do the right thing.
The other approach is to get off your heels. Put something on paper. Paint a picture that big improvements that are quantifiable to the bottom line are possible if the leader just says “YES” let the Hustler go get it, and then reward the person for achieving it.
There are some employees that think the raise/money should come FIRST, before the impact is made. In other words, pay me first, than I’ll deliver.
Negotiating from the position of “potential” is significantly weaker than one of Results.
Leaders NEED people that are hungry and compensation is certainly part of that. Leaders also need people that are HUNGRY for results, and need people around them hungry to drive those results. Most great leaders would be dying to step up compensation for great results. They just need people to paint a picture that they are the ones that will drive it.
Define what great results means. Make it a no brainer. Show how you will play a major role realizing them. Measure it. Take the risk away for the leader and ask for the money AFTER the results are there. Negotiate based on $’s achieved. Inspire a “no brainer” scenario. Make it painful for leaders to say no.
A common perception of a “Hustler” is to simply want more and more money at any cost. My definition is all around the hunger to generate great results…..and money naturally follows.
What do YOU think? What makes for a great pay raise system, one that is fair and motivating? Would love to hear your ideas, drop a comment.