Many managers cringe when they employees ask for a raise, and others struggle with how best to approach the subject appropriately and professionally. There are various compensation models and issues to consider. If we move past the mechanics and the details of compensation administration, the focus can switch to the concept of “value”.
Consider this as an employee…
Instead of: “I want a raise.”
Better: “How can I increase my value?”
Consider this as a manager…
Instead of: You will get a raise when you are here a year, or when you have completed X.
Better: We are a company that helps and supports you in increasing your value and contribution. As you increase your value, you will be able to increase your earnings.
There are complexities involved in compensation administration. Business economics, revenues and expenses, and concepts like market value come in to play. But when we have a culture that supports and believes in the concept of increasing one’s value versus raises, both the individual and the organization can benefit.
When a company culture operates like this, a manager who seeks an increase for a direct report says, “I would like approval to give Joe an increase; he has increased his value, he can run a crew, and he has overcome his reliability issue that I discussed with him 6 months ago.”
This approval can be given with enthusiasm. Joe is happy and the leadership is as well. There is joy in being part of an individual’s growth and success and the company is stronger and has gained value from Joe’s development.
Incorporating the theme of increasing value as the link to compensation sends a powerful message. The manager knows they want a raise. But he/she must be able to give the guidance and support to the individual so they may increase their value and subsequently get a raise. The company and manager now have a captive audience in guiding the individual’s development and the individual understands what they must do.
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