Asking For A Raise

Asking for a raise is difficult for most of us. There are a lot of reasons for this, but chief among them is that it is a really uncomfortable situation. Not only does the boss have more power and more information, but you have all the risk (or at least you feel like you do). This dynamic results in many people only getting tiny raises (or no raises at all). The power and information asymmetry in this process is difficult to overcome, but it can be done.

More importantly, it has to be done. If you have any big dreams at all, you probably need money to accomplish them. If you have kids, a spouse, dreams of going on a nice vacation, retiring eventually, or even building your own business, getting money is going to be part of that. However, asking for more money feels like a huge risk to all of those things. After all, what happens when the boss gets upset that you asked for more money?

Asking for a raise is challenging, but if you don’t do it, it’s very easy to end up being underpaid. There are a lot of things that you can do that can greatly increase your chances of success and reduce your odds of failure as well, so you might as well get on with it. Your cost of living goes up by the year, so there is little point in waiting to have this discussion with management. You should always be charging more.

Episode Breakdown

10:50 Why asking for a raise is tough

We’re taught not to talk about money as children and this carries over into work. We’re afraid to rock the boat. We’re supposed to be humble and asking for a raise sounds like the opposite of that.

“People that don’t have podcasts and aren’t narcissist are supposed to be humble.”

Your boss probably has a better idea of the company finances than you do. The boss also probably knows what your coworkers are paid and can compare metrics. The boss also knows what it would cost to replace you. You probably don’t.

While you can say “pay me more or I’m out”, that’s unlikely to go well. Whereas the boss could take your request for a pay raise as the last straw and start moving to let you go. There is also a power differential in that the boss tells you what to do and didn’t tell you to come ask for a raise.

It’s hard to time such requests, as you can’t always predict the boss’s mood. Timing is also difficult because there may be things going on with the company that you are unaware of.

You probably have reasons for wanting a raise. Those reasons don’t match the reasons management would want to give you a raise. For instance, your desire for a vacation doesn’t motivate management, but the fact that you saved the company half a million dollar might.

18:55 The basic rules

The role that you play in a company has a value that exceeds the value of your total compensation. It has to be this way, or they are losing money by having you on staff. So long as you don’t narrow the gap so much that they can’t make money, you should reasonably expect to be able to get a raise.

The company charges more for their product or services than it costs them or they go out of business. This means that your salary comes out of the cost of the product (or service). This also means that if you are instrumental in raising the cost that the company collects for the product, raising the amount sold, or lower the cost of creating the product, then you have negotiating leverage.

The cost of living is going up at a rate that exceeds inflation. In some places, it is several times as fast. This means that yearly cost of living adjustments based on inflation are insufficient.

“Standing still” is another way to say “falling behind”.

Some sectors of the economy are getting expensive even faster than cost of living. These include things like housing, medical care, insurance, education, and transportation. Even if you aren’t being squeezed by these yet, you are just a life change or two away from having that experience. For instance, if you start a family, you could potentially be hit with all of those except for education in the first year.

24:30 How to overcome the psychological stuff

You need to be doing this well in advance of asking for a raise. If you don’t have this in order, you don’t want to try and bluff your way through it. Not only will these things improve your odds of getting a raise, but they will help you in salary negotiations for your next job.

Feeling like you have no options. You don’t have negotiating leverage if you can’t leave. You need to go in with the assurance that you have other options. To fix this, you need to find out if you could get a job elsewhere. For most developers, a cursory search of available jobs in the area will convince you of this, at least in the current economic situation (provided your skills are up to par). If your skills are behind, then you need to be fixing this immediately, regardless of whether you are going for a raise or not.

Being afraid to talk about money. This is completely understandable. Beej and I were both raised not to discuss money in general. However, this doesn’t apply when you are trying to sell something, whether it is a product or it is your labor. The best way to fix this is to have money discussions in a low stakes environment. Noah Kagan (who founded AppSumo), suggests trying to get a discount on coffee at a coffee shop. If you can do this a few times in a lower stakes environment, it’s much easier to pull off in a higher stakes one.

Humility is a virtue, but taken to extremes, it can be destructive. It’s very easy to confuse a low sense of self esteem with a desire to be humble. Like talking about money, there are contexts where it is not appropriate. Get in the habit of showing people what you are capable of, not in a bragging way, but in a way that is helpful to them.

31:00 How to overcome Information Assymetry

This is another one that you have to do in advance. This stuff takes time and you don’t want to be scrambling around trying to get this information before asking for a raise. You should be passively gathering this information at all times, because it doesn’t just help with salary negotiations.

“You don’t want to ask questions when you’re sitting in your boss’s office asking for a raise.”

Try to figure out what other people are paid without asking them. Show them a salary survey and gauge their reactions. My experience has been that these are often inflated, so you should generally see them being surprised by the much higher rate. Find out what other people are being paid by looking at what the salary will be for open positions in the same company. Similar salaries can be found by looking at public records of salary, either for government jobs or for not-for-profit organizations. These are apt to be lower that public sector organizations, so you can use these along with other salary surveys to establish a range.

Find out how the company is doing. You don’t want to come in asking for a salary when the company is having a bad year or a bad quarter. You do want to be asking for a raise when the company is doing well, as it makes it easier for everyone in the approval process to approve it. Figuring out the next steps that a company is taking can also let you develop skills ahead of the company needing them, making it easier to get a promotion, a pay raise, or even to transfer to a better job.

36:40 Power differential

Your boss tells you what to do. The opposite is not true. This makes it difficult to force a conversation about salary. This also means that a boss that doesn’t want to have that conversation can find lots of ways to avoid it, and there’s not much you can do about it.

This means that you need to be careful in how you frame your request for a raise. The best way to do it is to request a one on one about your goals and career trajectory.

Put it in the context of asking for advice. This acknowledges the boss’s power in the situation, which will make them less likely to feel that they have to assert it. This is also a really good way to gauge whether it is appropriate to ask for a raise. It also serves as a good way to get management to justify giving you a raise.

Don’t try to assert your own power too much. Ask, “what could I do that would increase my value as an employee to the point where I could get a pay increase?” Don’t threaten to leave. They know you can. You know you can. Better to leave it unstated.

41: Timing

You also want to time your discussion about pay raises so that management is in a good mood. This means you are going to want to avoid having this discussion just before or after a product release or other major stressors. You probably also want to avoid scheduling your meeting around other large distractions, such as board meetings (if your boss or THEIR boss attends), major holidays, and busy times of year (such as tax season, Black Friday, etc.) Try to figure out what chronotype your boss is and leverage that to your advantage. If they aren’t a morning person, don’t schedule the discussion in the morning.

Don’t do it at a bad time for you. Don’t schedule the meeting first thing in the morning if traffic tends to make you late. Don’t schedule it at a time or in a situation where you are likely to get interrupted. Be careful about your own chronotype as well. You don’t want to do this at a time of day when your energy is low.

Do it at a time that is to your advantage. If you’ve taken on a larger role, that’s a good time to ask. When you’ve just finished a big project is also good. It’s also good to do it in advance of your annual review, with the goal of the raise happening during the review. Make sure you time it in accordance with your company’s review policy if you can.

49:10 How not to be stupid

Don’t threaten to quit. Even if you get a raise after threatening to quit, they’ll see you as having a foot out the door and you’ll be a primary target in the next round of layoffs. It’s also bad to frame a negotiation in a way that sounds like a demand. Yes/No questions have a 50% chance of being a “no”. You really want to go for a gradient of options so that you get something, even if it isn’t quite what you were aiming for.

Don’t go in without rehearsing. You should be familiar with any KPIs being used to evaluate you and should know yours off the top of your head. You should also think ahead about what objections your manager might have and how to counter them. It’s also important to sincerely think about why you might not get a raise, so that not getting it doesn’t produce an emotional reaction from you. It’s easier to try again later if you didn’t make a scene.

Don’t look sloppy.Don’t threaten to quit. Even if you get a raise after threatening to quit, they’ll see you as having a foot out the door and you’ll be a primary target in the next round of layoffs. It’s also bad to frame a negotiation in a way that sounds like a demand. Yes/No questions have a 50% chance of being a “no”. You really want to go for a gradient of options so that you get something, even if it isn’t quite what you were aiming for.

Don’t go in without rehearsing. You should be familiar with any KPIs being used to evaluate you and should know yours off the top of your head. You should also think ahead about what objections your manager might have and how to counter them. It’s also important to sincerely think about why you might not get a raise, so that not getting it doesn’t produce an emotional reaction from you. It’s easier to try again later if you didn’t make a scene.

Don’t look sloppy. Dress a little better than normal if it is going to be a face to face discussion. You want to project professionalism, but don’t want to look like you are trying too hard (this reeks of desperation). You probably don’t want to do this with a hangover or poor sleep either.

Don’t have the raise as your only option. Sometimes company finances just don’t allow for a raise, or only allow for a tiny one. This is a really good opportunity to ask for other things that would be valuable. This could be changes in structure, such as working from home, doing 4 10 hour days instead of 5 8’s. This is also a really good chance to ask for more responsibility. Responsibility can be leveraged into pay later, whereas the reverse is not true.

Don’t cite personal circumstances as a reason for a raise. Your boss may care about you, but your personal circumstances are largely your choice and are going to be seen as your problem. Instead, base the discussion around the value that the company gets. Don’t frame things to make it sound like a charity case.1. Dress a little better than normal if it is going to be a face to face discussion. You want to project professionalism, but don’t want to look like you are trying too hard (this reeks of desperation). You probably don’t want to do this with a hangover or poor sleep either.

Don’t have the raise as your only option. Sometimes company finances just don’t allow for a raise, or only allow for a tiny one. This is a really good opportunity to ask for other things that would be valuable. This could be changes in structure, such as working from home, doing 4 10 hour days instead of 5 8’s. This is also a really good chance to ask for more responsibility. Responsibility can be leveraged into pay later, whereas the reverse is not true.

Don’t cite personal circumstances as a reason for a raise. Your boss may care about you, but your personal circumstances are largely your choice and are going to be seen as your problem. Instead, base the discussion around the value that the company gets. Don’t frame things to make it sound like a charity case.

IoTease: Platform

LiveStream

This is a platform for real time video and data streaming. It supports all sorts of IoT devices. Video streams can come from drones, wearables, fixed or mobile cameras. The video and associated data can be monitored. You can even record and analyze the stream. They also have a cool looking dashboard. This is an enterprise level solution so may not be for the average hobbyist.

Tricks of the Trade

Frame is important. You need to characterize things correctly beforehand so that conversations go well. This is useful in all sorts of negotiations and interpersonal interactions.

Editor’s Notes:

We’re still working on our remote setup please forgive the shuffling and clicking.

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One comment on “Asking For A Raise
  1. senotrix ltd says:

    thanks for fine and satisfied post

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