Articles, Blog

4 steps to successfully negotiate a pay raise. The PREP Method

Do you feel uncomfortable asking for a raise? Well, let me share the PREP method with you. It’s an effective method of asking your manager
for a raise but keep in mind that while a terrible salary can you make you hate your
job a great salary doesn’t make you love it. Research has shown that many other factors
such as career progression, the relationship with your boss, and the nature of work are all more important than how much you get paid. There are several things you should prepare. Firstly, be awesome. You should have a clear understand of what
is expected of you, your key performance indicators (your KPIs) and you need to be meeting
or exceed your targets. If your performing is rubbih, don’t ask for
raise. Know your value. If you don’t know your market value, you won’t
be able to tell a good offer from a bad offer. There are several things that affect your
value such as your location, experience and qualifications. I recommend websites like glassdoor, payscale
and careerbuilder, to quickly find out how much you should be getting paid. Practice what you will say. This may feel a little weird to begin with
but it is better to feel weird at home than at work. Practice in front of a mirror or with a friend
so that you can be confident. This is a negation; you’re selling yourself,
so you need to have confidence. Schedule the meeting. Don’t just ask for a raise in the corridor
or kitchen. Book time to be F2F with your manager. It shows you’re intentional and serious. But make sure you’re fully prepared before,
as your manager maybe available now! Research – your company and your manager to
understand their point of view. This helps you prepare for potential responses. From a company perspective you need to understand the financial position. Are they making profit? Is there a downturn in the economy? What about in your sector? If your company is publically listed, get
a recent copy of the quarterly reports. From your manager’s perspective understand
if they are the real decision maker or not. Do they have the ability to sign off or do they need to escalate a pay rise? You should expect that even if they do have
the ability, they may want time to think. Most managers need to consider:
(a) Your performance and pay compared to co-workers (b) How much it would cost to replace you. Typically, managers will not pay you more
than what they can replace you for (c) Tenure. Employees with several years tenure normally
have a good cultural fit and are worth more (d) The Company Review cycle. Do you normally have an annual review? Your boss maybe limited outside of it. (e) Pay scales or bands. In many companies jobs are allocated into
salary bands. You stand a much higher chance of an increase if you’re not already at the top of your band. Each of these factors will have an impact, positive or negative, on your chances. Know the answers yourself. Highlight the positive and have an answer
for the negative. Now you’re ready to meet with your Manager
and Explain your situation. This is not just knowing what to say but how
to say it. You should never beg, threaten or antagonise
your manager. Even in the rare case where this does help
you in the short term it will negatively affect your changes for future promotions, bonuses
and raises. Consider your managers point of view. Don’t tell them that you need a pay rise because
you want a bigger house or a new car – they probably don’t care and it will make you seem
shallow. Start by truthfully framing the discussion. Explain what you like about your job and the company. Tell them how you are committed and how you
want to add value to the business. Be humble but demonstrate your value based on your performance. You need to be specific, so using data is
a good option. Show them your performance compared to targets
or co-workers. You may explain how your role
has changed and is now more complex or has greater responsibility. This does not need to be a huge presentation
typically 1-2 minutes is enough. You then need to present your proposed salary. Keep this simple. Don’t apologise. It is very important that you present your
figure first before your manager tell you theirs. This is because of the “Anchoring effect”
which was made famous in the book “Thinking, Fast and Slow”. The author won a noble prize for his research
so it is worthwhile thinking about! You don’t need to understand all the details,
but the research has shown the person who speaks first anchors the discussion to the
level they are thinking about. If you speak 1st it anchors your managers
thinking to level you are thinking. Let me give you an example of some of the
phases you may use “Hi Sam, thank you for taking the time to
meet with me” “I am really thankful for the opportunity
I have in this role. I enjoy working here and having you as my
manager. I am engaged here. I am committed to this company”
“I want to be the best I can be. For the last 9 months I have consistently
met all of my KPIs” “I feel there like there is an opportunity
for my salary to be adjust to reflect my performance” “I have research my market value and I feel
a salary of $80,000 is a better reflection of my skills, experience and performance”
“Is this something that you can help me with? You do not need to spend too much time justifying
yourself. Be respectful but direct. Pivot. Expect that in many situations your manager
may say “No”, “Not yet” or “Yes, but with a much smaller offer”. That’s okay, it’s a negation. The worst thing you can do is just say “Yes
agree and leave the office. Don’t leave. Understand why, understand the reason behind
the reason. This is as easy saying “Can you help me to
understand why?”. Then listen to their answer and acknowledge
their reasons and before you respond. “So there are 3 reasons why”. Ask them what it would take for you to get a raise and go do it. Circle back and close the loop. Or perhaps there is a salary constraint and
there is nothing they can do at the moment. This is also okay. Pivot to other options. In many situations your manager may be able
to approve a flexible work at home one-day week or, equity in the company or perhaps
a onetime bonus, or additional paid leave each year. So respond by saying “Okay, I understand that
a salary increase is not possible at the moment, what other options available? Perhaps a more flexible working arrangement
or a once off bonus?” When it comes to pivoting, you expect that
your initial offer may not be accepted. Seek to understand why, listen to the response,
acknowledge the reasons and then bring other options into the discussion. At the very least you should leave the room with an agreement to talk about this again in the future I hope you enjoyed learning the PREP method. Give me a thumbs up and subscribe below. Thanks for watching.

Tagged , , , , , , , , , , , , , , , , , ,

1 thought on “4 steps to successfully negotiate a pay raise. The PREP Method

Leave a Reply

Your email address will not be published. Required fields are marked *