The Best Time to Negotiate a Raise?

The best time to plant a tree is 20 years ago.
The second best time is today. ~Proverb        

The #1 mistake in negotiating a pay raise is waiting until your performance review. Or worse, waiting until your company’s annual budget review.?

Why?

Because your manager and their manager’s decisions have already been made, or at least been influenced by factors that are mostly beyond your own control or influence.?

At minimum, make sure you express your desire for a raise before your manager has to submit their budget requests.?

Some suggest starting this conversation 90 days before your performance review.?

I want you to start even earlier.?

The Best Time to Start Negotiating

The best time to start negotiating your raise or promotion is when you are negotiating your job offer.?

You heard me right.?

You’ve also probably heard me suggest that you think more broadly about negotiation: It’s an ongoing conversation influencing an outcome, in this case within an employment relationship.?

Part of your first negotiation with your prospective/new employer is not just about your salary and compensation. It's also about the terms and expectations, how you can be successful in your new role, the prospects for growth and fulfillment, how your performance will be measured and rewarded.?

Plant those seeds early, my friend.

The day you start your new job is the day you start creating value and evidence as to why you were worth hiring in the first place, and also why you are worth paying more the following year.

If you're thinking, “oh crap! I'm so far behind!”, don't worry! It's not too late.?

The Second Best Time To Start Negotiating

The second best time is just like the proverb says, TODAY.?

You just need to get started right away. And, you want to do more work retrospectively, to create the evidence you need to show them that you're going to be worth even more next year.?

Create value. For your boss, your organization. Track the value you create. Share that value with your boss on an ongoing and regular basis. Signal your interest and desire in growing your career with the company, and ask your boss to recommend your best next steps.?

Just like planting the seed for a tree to grow, you are planting seeds, early and often, so the idea of your next raise or promotion can take root and start to grow.?

When you do finally make a direct ask to your boss, they won't be surprised. In fact, they may even come to you first!

Many people make the mistake of thinking that a raise is based on their past efforts, like getting an A in Math because you solved all the problems correctly. That you should get a raise for all the work you have already done.?

In reality, you have already been paid for that work.?

In truth, a major reason why your manager, your boss, is willing to give you a raise is because of the future value that you have to offer them to keep you around and to keep growing your capability.?

Yes, your past efforts and results matter - mostly as a predictor of what you will deliver in the future.?

However, your salary raise is prospective - it runs forward into the future and is the stepping stone for your next increase.

Plus, a salary raise for you raises your employer’s overall expense line for compensation. Which is why many employers will offer annual bonuses for past performance. They are one-time expenses, and are not added to ongoing annual fixed expenses.

So, continue to focus on creating value, and what that will contribute to your organization's future.

How to get started

Start by keeping track of your work successes.?

Open a file on your computer, or a notebook. Keep track of the projects you work on and the results that you help create, even when you're part of a team. You can keep this as part of a formal performance review system, however I want you to keep a copy for yourself.?

Why??

Because you're going to want this the next time you're looking for a new job. Your track record of success is not only what you use to negotiate a pay raise, it will be what you'll use to negotiate for your next job, or promotion.

In this file, also include any notes of congratulations, of “thank you for helping us out on this project”, any form of testimonial.?

Note: another benefit to keeping this file is it's a place you can go to when you're having an off-day and you need a reminder of the things that you have been able to achieve and the people you've been able to help. This can go a long way to boost your confidence and keep you going.

You can also get started by following the practices laid out in the remaining chapters coming out in the next few weeks.

The moral of this chapter

Get started. Don't wait until they ask you if you're ready to negotiate.?

Always be ready.

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If you're looking for some help with your negotiations, let's talk!