Thinking Strategically About Your Next Raise

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Thinking Strategically About Your Next Raise
Sacha Cohen

Yearly or more frequent performance reviews are de rigueur in most workplaces. Generally, the scenario goes something like this: You are summoned into your manager's office, she goes over an evaluation sheet, and at the end, and she tells you how much of a salary increase you'll be getting. This time, however, instead of sitting back and hoping that your manager will come through, it's time to be proactive.

Preparation is as important when you are negotiating for a raise, as it is when you are negotiating your starting salary. Make sure you know what kind of salary you can command by reading salary surveys and other sources of salary information, and discreetly find out the ballpark percentage increase your colleagues are making. For example, what's typical for some companies-such as 5% or so-may be very low for others. The standard percentage raise for a given company is also likely to change depending on the economy and fiscal circumstances for a given year.

Lee Miller, author of "Get More Money on Your Next Job," recommends going online to sites such as Salary.com or Futurestep.com to do salary research. He also advises contacting associations such as the American Chemical Society, which may conduct salary surveys for specific professions. In addition, Miller says you can learn a lot by networking with people in your field or talking to headhunters and recruiters about what the salary range is for your current experience level.

The Art of Self Promotion

Some managers tell employees to keep a list of accomplishments (presentations they've given, awards they have received, projects they've worked on, continuing education courses) for the previous year. It's helpful to have all this information in one place to make a strong case. Keeping letters and e-mail that support these accomplishments is also a good idea.

Elizabeth Dougherty, a compensation consultant with Watson Wyatt, a human resources consulting firm based in Washington, DC, says that the best way to prepare yourself for a performance review is to conduct a self-assessment. "Use the criteria upon which your supervisor will judge performance. Consider both quantitative measures (revenue generated, deadlines met) as well as behavioral criteria (for example, acted as mentor to junior team members, proactively handled critical customer situation)." Dougherty also says you should reflect on your "development opportunities" -- skill areas where you can improve, areas of interest, areas which will lead to promotional opportunities -- and be prepared to offer some suggestions. Finally, she advises employees to provide feedback regarding any significant barriers (and suggestions for overcoming those barriers) to your productivity, quality and effectiveness.

Laying the groundwork months in advance is essential, says Miller. "The time to be thinking about your next raise is as soon as you've gotten your last one," he says. Since most managers have very little idea of what you are doing on a day-to-day basis, it's your job to let them know. "Most people think if they are doing a good job, they will get a raise or promotion automatically, but unless you make a conscious effort to get that information to your boss, you may be passed over," warns Miller. To this end, you need to become a good self-promoter. You may be doing a great job but if your supervisor has no idea what you are up to, it won't matter at review time.

Like Dougherty, Miller suggests that you make a comprehensive list of the projects that you are working on and the progress you are making on each item. It doesn't help to only communicate your successes with your boss at the review; you have to let her know how you are doing throughout the year. Explains Miller, "Casually keep your boss informed." Meet with him once in a while, send the occasional "progress report," anything to keep the lines of communication open. "One really good way to let your boss know how well you are doing is send your boss a note to praise the people on your team - laud the people you work for and therefore you laud yourself. "The key is communicating with your boss. If money's attached to the project, savings, etc. make sure your boss knows about that as well---put a number to it."

Sidebar: The Dos and Don'ts of Getting What You Deserve

Timing Is Everything

Before you go racing into your manager's office to demand more money, keep in mind that timing is essential. "The boss is no different than everyone else," says Richard Chang, CEO of Richard Chang Associates. "They have good days and they have bad days. Look for signs or characteristics that indicate you're actually talking with them on a good day. If you have a pre-scheduled discussion time, and there are indicators that this is a bad day, be sure to re-schedule the discussion time."

"Ask for a review out of cycle (i.e. not during regular performance review periods)," advises Miller. A great time to approach your manager is after you've had a success - such as a project that's gone extremely well. "You need to pull yourself away from the masses. It's easier if you take yourself out of the cycle and somehow distinguish yourself from everyone else."

Also remember that whether you are on the giving or the receiving end, work evaluations make most people uncomfortable and your boss may also be feeling stressful about the situation. "When you approach him or her, strive to create a comfortable environment and to build understanding and appreciation for your performance and for the reasons you are making your request," explains Chang.

Negotiating and Counteroffers

Let's assume that you are less than pleased with the raise you've been given. Is it wise to negotiate? Dougherty says that yes, you should discuss the increase amount with your supervisor to understand the rationale behind the dollars. "Be prepared to express your dissatisfaction by articulating your reasoning, for example you might say, 'The project I managed came in on time and under budget.' She cautions, however, that negotiating an amount may be difficult since criteria other than performance (such as budgeting) may play a role in the ultimate increase amount.

Unfortunately, warns Dougherty, if employees share in the success of the organization (vis-à-vis bonuses), then they might also be expected to share -- to some extent -- in the organization's hardships. But even during tough economic times or despite poor business results, some organizations may be willing to offer non-cash rewards to superior performers. The key to getting those rewards is to make sure you keep a good record of what you've accomplished throughout the year. The more data you have, the stronger your case will be. While the company's benefit policies may be difficult to change, other options such as comp time, more training, continuing education or the chance to attend conferences or professional seminars are good alternatives.

Like Dougherty, Miller also recommends conveying your disappointment to your boss, but in a constructive manner. "Ask your boss what you can do in the future. Ask for advice about how you might go about getting a better raise or promotion next time around." It's important to make your boss your ally so that they have a stake in your success. "Once you get the advice, and if you follow it and let your boss know you are following their advice, it becomes very hard for that manager not be your advocate," he says.

Miller also says that you can try to negotiate the timing of a bonus. "Convince your boss that you should get a bonus and agree that you will revisit the bonus issue in three months and if business is better you'll get a special bonus then. The key to that is to show why your circumstances are different than anyone else."

Experts don't advise using another offer as leverage if you are not satisfied with the raise you've been offered. "It's a very, very risky strategy and if it appears that you are threatening, it makes you look disloyal," says Miller. If you do decide to use this tactic, you must be willing to walk away from the company if it fails.

"Most significant increases in salary when you are already with a company result either from an increase in responsibilities or from concerns that you might leave. Therefore, any strategy you use with your current employer should include an effort to get more responsibility or to make yourself so invaluable that the possibility of your leaving would cause immediate concern," concludes Miller.

Sacha Cohen is a Washington-based business and technology writer. Her work has appeared in The Washington Post, Kiplinger.com, Fast Company, Oxygen's ka-Ching and other print and online publications. Cohen has been covering Internet trends and culture since 1996.