A few weeks ago I received an email from a client, asking for guidance in approaching her boss about a raise. Since accepting a new job about a year ago, she had taken on new areas of responsibility that were not in her original job description, making her position more senior and valuable. She felt that her compensation should reflect the change in her responsibilities, but was not sure how to go about raising the issue.
We continued this conversation in person through the coming weeks as she negotiated a change in her compensation package. What follows here is a summary of the central ideas that we discussed (for more about these guidelines, see Getting to Yes.)
Three key elements can make the difference between success and failure in any negotiation: needs versus positions; principled negotiation; and BATNA – Best Alternative to a Negotiated Agreement.
Needs versus positions: Asking for a raise probably brings up all your anxieties about confrontation. But the truth is that negotiation doesn’t have to be combative or confrontational. The best negotiations are the ones when both sides recognize each others’ needs, and they try together to find a solution that will satisfy those needs.
So the first thing you have to clarify is your need. Asking for a raise is a position, not a need. The need is the reason you are asking for a raise. Different people want a raise for different reasons, and if we can define the need behind the request, it becomes much easier to find creative ways to address it.
You may want a raise because it will grant you recognition for the good work you do, and at your present salary you feel under-appreciated; if that is your need, it may be possible to meet it in some other way, such as a title change, a better office, a one-time bonus, a better benefits package, or more flexibility in your hours.
You may want a raise because you need the money, immediately, for some urgent reason. Here too, it may be possible to meet that need in other ways, such as a low-interest or no-interest loan from the company, or a significant salary advance. You may want a raise because you are going to need a higher income in the future and you want to ensure that you will get it at this job; in that case, a slow and steady increase in salary could fit the bill. You get the idea.
Now, try and think about your boss’s needs in this negotiation. He may want to make sure you are happy so that you will stay; he may also not be able to pay you more than he is already for various reasons, but may be open to other ways of keeping you happy such as the examples noted above.
Principled negotiation: this is the key to keeping your negotiation professional, and save it from degenerating into a Middle Eastern marketplace barter. Basically, you need to do some homework and find out what is acceptable compensation in your industry for someone in your position, in terms of salary, social benefits, and other perks. Base your request for changes on these uncontestable facts. It will move the discussion from you needing to prove that you are “worth” X, to an objective plane of the appropriate compensation for someone in your position.
What is your BATNA? This is a great acronym, meaning Best Alternative to a Negotiated Agreement. It is your only real leverage to get what you want: if you will actually do something different if you don’t get what you are asking for, and your employer would like to avert that change, you have some leverage. This can only work if you really mean it, and are not just bluffing.
When you are negotiating a new position, your BATNA will often be to leave the negotiation and find another job; in fact you may already have one or more other offers to choose from; that is why the moment before you sign a contract is usually the moment of your greatest leverage. But even when negotiating a change in your compensation package, everyone has a BATNA.
For example, in a case like my client’s, she could decide that if she is not granted an appropriate response to her need, she would drop the new areas of work that she had taken on, and go back to doing only the work that was in her original contract.
Life is full of negotiations: job interviews, raises, negotiations in the family about who gets the car and negotiations between nations about averting a war. Internalizing these concepts – needs versus positions, principled negotiation, and BATNA – can serve us all well as we negotiate our way through life.