The Correct Way To Negotiate A Raise As An Employer | Lessons From 'Mad Men'

Hey there, you are watching The Real Entrepreneur. And today we're going to get real about asking for raises. You ever have an employee do that? Come to you, how they ask for a raise, the right way to do it, the wrong way to do it. Before we kick into this episode, which is Mad Men, I want to invite you to ring notification bell, push that subscribe button, and, uh, let's get into the show. Here we go. I love— what is this? The Happy Thursday, Mr. Krabs.

You've never opened one of these, have you? Hey, Todd.

Yes, Mr. Crane.

Nothing. Get the door, will you?

Oh, paycheck stuck together. All right, so what he's doing is not, not legit. I just say it's outside policy. I want to tell you something before we go into this next scene. He opens the check and looks. I want you to know what he's doing is representative of what so many people are doing, at least in their mind, trying to guess what other people's salaries are, if they're being paid fairly and appropriately. It's the comparative effect. If I make more than someone else, then I feel good. If I make less than someone else, I'll ask why. And it's often regardless of our contribution. If we see ourselves as similar people, as equal to some degree, regardless of performance, we all have a high perception of ourselves, we will look at their compensation compared to ours and be disappointed, upset if our compensation is less. And we may even use it as negotiation tools. That's always going on in our mind. This one's now going out in reality.

Do you have a number 10 envelope with a windowpane?

No, why?

Can you make one?

No, why?

Can you fix this one? Make it so it can look unopened?

You need a fake passport too?

I got Ken Cosgrove's paycheck by mistake. I opened it.

How did that happen?

A mistake.

Well, just throw it away. He'll ask for it by the end of the day, and they'll cut him a new one. Don't throw it away here, though. People go through the trash.

Of course.

So, were you upset about getting caught? Or were you upset about what you saw?

I don't know if this would mean much to you. It's $300 a week before taxes. We're married. I have a baby due in August. You know, Jennifer said she thinks that I should just go in and demand a raise.

You told your wife about this?

So here's— it's funny. So he revealed the number. Now he's trying to do is build a collaborative kind of argument with someone else, but also he's talking with his wife and stuff. This starts a spiral. The people in his corner are going to say, my God, you're getting ripped off. I've seen people lose jobs because they overinflate what they're worth. Emotional inflation, I call it.

I know. I do that. I keep doing it. I didn't know what to do.

There's nothing you can do. That's why you don't tell your wife. Wish you hadn't told me.

I think she's right.

But isn't media a meritocracy?

You think that? What's that supposed to mean anyway? I have plenty of merit.

Merit defined within reason. As in, this place can't run without you.

Well, how the hell do I do that?

Then you're worth every penny they're paying you.

Thanks, Sal. You said you wanted to see me? Yes, I did.

You're Harry Crane, right?

Yes, I am.

Certain things have come to my attention.

Oh, no.

I heard about it third-hand, and I thought it sounded reckless, so I talked to Mr. Cooper.

Mr. Cooper knows about this?

I think someone told on you, and it backfired. Mitch. Doesn't matter. Cooper thought it showed initiative. So you're in here now. I'm smiling. What do you want?

Uh, well, I guess, uh, for one thing, I think that we should have a television department. All the other agencies have them, and I think I should run it.

You are now the head of the television department, which is comprised solely of you.

Anything else? Well, actually, um, I think I deserve a raise.

All right, so obviously there's confusion here. It's about something he thought was about the money, though, that he's looking at a check, but clearly it's about something else. He showed initiative in that meeting. So now let's see how it plays out.

And I think you've already received a sizable reward. Let's not get greedy.

I'm not being greedy.

Are you arguing with me? How much do you make?

$200 a week plus drinks. Give me a number.

I'm gonna stop right here. That if you're gonna ask for a raise, that actually is a good way. We'll see how this breaks down. But if you ask for a raise, say, I believe I deserve a raise, have your argument ready. But put pause in there because then we'll see how people respond. If you start explaining, you don't afford time for the other party to come back, and they may simply say it's done too.

Uh, how about $310?

No one makes that around here, not even close. How about $2.25?

Say yes. Yes.

I'll throw in new business cards. You drive a hell of a bargain.

Pause again. This is really a good time. I'm liking how the tactics are going out. The counterpoint is, you're being greedy, you already got a reward. And now he's going back and saying, well, I don't think it's fair. And, uh, he— the boss here makes a maneuver where he's offering a drink. He's making a concession through his gesture. So the It means he's listening, even though his words may not say that. He's fighting, his words maybe he's fighting back, but his gesture's saying he's open for listening. Watch for those hidden cues, hidden clues and cues, I guess it's either one. Watch those hidden clues when you're in negotiations. What I love about that is he didn't go asking for a raise by saying other people make this money. The way he went about it is not necessarily appropriate, but what he did that I like is he started demonstrating chutzpah, how he's negotiating, how he's talking, he's pushing forward. Uh, he made a strong, clear argument for what he wants. We should have a television department because everyone else does. So he made the argument. If there was more explanation required, I hope he had the ammo ready to go. When he asked for the raise, he just said, I like the raise. And then, um, he went to a negotiation. He also set a decoy price saying $310,000. I think he wanted to beat the the other, um, the other compensation he saw. So he went a little bit above, but it says stage and he was able to bump himself up. He got a 10%, over a 10% raise, uh, just by asking. So, uh, interesting insights and maybe the opportunity for you too is just to ask. All right, my friends, I hope you learned something from this episode of Mad Men and this episode of The Real Entrepreneur. If you have any questions, go to mikemichalowicz.com/question. Please push notification button and the subscribe button so you don't miss a single episode and you get a heads up when the next episode comes out. All right, I'll see you next time. Bye.