Sunday, July 09, 2006

Salary Negotiation and Asking for a Raise

Funnily enough, while most universities conveniently cover global business techniques and how-to-build–better-mousetraps over their three- or four-year scholastic programs, not many tackle one of the earliest challenges on a graduate student’s agenda – first-time salary negotiation.

With all the exhilaration surrounding a job offer, it is quite easy to succumb to a joyous ‘Yes! I'll take it, where do I sign?’ And, while such enthusiasm is expected and even commended, this course of action is not always in your best interest.

Negotiating Your First Salary
Let's begin with a definition of ‘negotiation.’ In a nutshell, it's meeting to discuss a subject with another individual in order to reach an agreement.

While salary negotiation generally begins towards the conclusion of the interview process, for grads it really starts with the initial interview. Achieving the salary you deserve, is founded on what you have told the potential employer about yourself, any accomplishments you may have achieved and what you can deliver on the job; all of which increases your worth when a pending job offer arrives.

Therefore, during interviews, use dynamic words to describe accomplishments - ‘initiated,’ ‘developed,’ ‘oversaw,’ ‘created,’ ‘took charge of,’ ‘followed up on’ and ‘actively contributed to’ – all of which will significantly help your case. Additionally, the skill to handle details, multiple projects and time management will also contribute significantly to your wage value.

Simply asking for more money, unfortunately, is not negotiating. You will need to answer or research certain questions prior to discussing salary, to know if there is even a chance to secure more. Among the questions to which you should know answers include:

  • What is the salary range of the job?
  • What is the lowest salary I will consider?
  • What makes me worth a higher salary?

There are several places you can secure this information, including the university career services office, recruitment firms, job search web sites, people who work in your chosen industry, and trade associations and publications.

However, notwithstanding you can answer these questions, there may be opposition to your request for more money, in the form of:

  • That would be more than other employees at your level are making;
  • Your experience is not enough;
  • There’s no room in the budget and, the tried and, sometimes, true;
  • That's what we pay new hires.

When responding, think about these objections in a way that continues the discussion positively and without pinning yourself down. Remember, you are asking questions - not delivering ultimatums. For example in responding to the ‘more than other employees at your level are making,’ you may follow up with a response such as: ‘what is the range for this post?’ and ‘what would it take for me to get to that higher level?’

If the manager indicates the company does not have money in the budget at the present time, you may wish to counter by highlighting how you have saved or generated the firm money through your (if appropriate) accounting, sales or management skills. Sometimes, senior management needs to see that a raise can be paid for out of the revenue you have created. However, as a rule, the ideal time to ask for a raise is immediately after you have demonstrated your worth to the company via a business win or cost-saving achievement.

Always keep in mind that you're looking for a way to reach a mutually-beneficial arrangement and often you have to ask a few questions to see if there may be a way to reach an accommodation. In many cases, especially at this level, the person offering you the position has already received sign-off from someone else, so you have to give them a good foundation to return to that authority and ask for more money.

Also keep in mind, that when negotiating your first salary, you may be spending the next 30-40 years working – not necessarily with that organisation - and it's critical to find a job for which you are both qualified and, indeed, like. If this means accepting an offer with a firm you admire or respect tremendously or believe has great career potential, but the salary is marginally lower than you wished, it may still be worthwhile… particularly if it's an organisation in which you can grow and learn over the long-term.

Asking for a Raise
Asking for a raise in salary is never easy. However, if properly prepared, you can come away from a salary increase negotiation with a figure with which you and your employer can be happy.
First, however, it is essential to appreciate external pressures - what does the current and mid-term economic environment look like and how is your organisation performing in this environment? If the economy is in recession or your firm is struggling to stay profitable, then clearly it is not an appropriate time to ask for a raise - no matter how strong your reasons. However, if the company is making money each year and growing according to plan, you'll probably have a chance of securing a wage increase.

Prepare a list of your accomplishments. In the time you've been employed in the company, what have you done for them? What do you plan to do moving forward? Why should the firm invest more money in you? Had you been keen to work hard for the organisation in the past and are you willing to allocate longer hours and extra work in the future? Before you even get within eyesight of the manager’s office, ensure you can answer all of these questions.

When you are prepared to meet with your manager, wait for a good time to ask for an appointment. If word has it the boss is in a difficult frame of mind or complaining of how they can't get on top of their work, it’s obviously not a good time. If you feel the boss is in a positive mood, this is probably a good time to make an appointment to see them. Pick the meeting time carefully - as with most things in life, timing is everything.

When asking for a raise, use ‘past and future performance’ as your rationale. For instance, your professional performance has nothing to do with the fact that you need the money to move out of your parents' apartment before you turn 35 or that you need to buy a new liver to compensate for the four years of university drinking that have finally caught up with you. Present your case in a professional manner - state what you have done for the company in the past and what you plan to do in the future. Your supervisor may be a concerned individual, but at the end of the day, your performance at work and the amount of money available are the only two things that really matter.

Also, don't act as if you are entitled to a raise. Be confident and show your worthiness of a raise, but don't expect it. Just because Mandy in the next cubicle received a raise two months ago, or that you have been at the company for a certain period of time, doesn't mean you are owed a raise. We all believe otherwise, however the powers that be that sign your paychecks may not feel the same.

With that in mind, prepare well and you’ll make a good case for that raise!


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