3 Things to Do Before Asking for a Raise
You're probably underpaid.
It's an unfortunate fact of organizational life that salary bands tend to increase more slowly inside the company than they do outside. This is known as pay compression, where the starting salary for a new hire can be similar to or higher than the salary of someone already doing the work inside the company. When this occurs, job hopping mercenaries are more handsomely rewarded than faithful team players.
There are at least two options here:
Begin looking for a job at a different company. You'll lose seniority and relational equity, but you'll likely make up for it in cash. But changing jobs to chase a paycheck is fraught with difficulty - it's possible you'll end up in a toxic company culture and no amount of money can undue that pain.
Ask for a raise.
Here's a few suggestions on helping prepare for that conversation where you ask for a raise:
Seek to add value (and communicate the value you add)
Adding value means growing your productivity faster than inflation and the competition. If your portfolio of responsibilities hasn't increased since you first came into the role, and you're doing pretty much the same work in the same amount of time, don't expect to get anything more than an occasional cost of living adjustment.
Adding value means you're able to solve someone else's problem. A problem prevented is the same as a problem solved, so don't discount the careful work you do with processes and people to ensure problems remain at a minimum.
Adding value means surprising and delighting your customer. Going above and beyond makes you indispensable.
Don't be reticent to showcase this work. Your manager may not be aware of how you've taken on additional responsibilities, supported team members on a regular basis, or become a go-to person for your customers, both internal and external.
Tie your behavior to company success
Quantify your output in terms of dollars generated, dollars saved, or customer experience improved. Think of yourself as a consultant who has to justify their ROI with every project. What are you doing that's helping the organization fulfill its mission, adhere to its values, and secure enough profit to fight again another day?
Any business owner will gladly invest more in the people and behaviors that drive profitability. Do your best to become that person.
I do not recommend leading with "deserving" language, like "I've been here 3 years, I deserve a raise." This mindset shifts the conversation to something other than your ability to increase the company's competitive advantage, which is what you should emphasize.
Use data wisely
Sites like payscale and glassdoor are helpful benchmarks for what peers in your field are being paid. It's useful to know these figures and have them as bargaining chips in the process. But remember there's rarely an apples-to-apples comparison. Your entire compensation package is roughly 1.3x your base pay, and comprises the various health, PTO, and fringe benefits the organization provides. Those differ, sometimes significantly between firms, and can impact your total take home pay in ways that are difficult to determine ahead of time.
Asking for a raise, when done well, is a noble act. So too is leaving a role because your value is not being recognized or appreciated and finding an environment where it is.
Both require a combination of humility, ambition, and courage. These are qualities that lead to good things.
If you benefited from this, please share.