Ramit Sethi explains two salary-negotiation scenarios: (1) asking for a raise based on strong performance and (2) asking for a raise because you are dramatically underpaid. The chunk provides a step-by-step method for performance-based raises: schedule a dedicated meeting, present documented achievements, propose 3 specific measurable goals that would make you "extraordinary," secure agreement that meeting those goals will trigger a salary discussion, give regular progress updates, and then close the loop to make the increase unsurprising to the boss.
Chapters
I've got two scenarios for you when it comes to negotiation. The first is if you want to raise because you're very good at your job. In other words, for performance reasons. The second is if you want to raise at your job because you're being dramatically underpaid. So I'm going to help you with both of those. First, if you want a salary increase because of performance reasons, because you've been doing really well, what do you do? How do you go about that? Here's what I would suggest. The bad way is to walk into your boss's office and demand it, Hey, I really want to raise. I'm so good at my job. What do you think the first thing a boss does when that happens? It's a bad sign. There's a psychological term called reactance. It's when someone kind of tells you what not to do. The same thing is kind of a cousin of this. You get defensive and you start coming up with reasons why you should not give that person a raise. So you do not want to paint someone into a corner. What I like to do is take a little bit longer and make it part of a really feel good exercise. Because our career is a long time, right? If I'm going to get a 5 or $10,000 raise just at this job, which is then going to be compounded over the rest of my lifetime, for me, that's worth a few months to do it right? Here's what I would do. Go into your boss's office and be very clear. Set up a special meeting and say, look, I want to do the best possible job I can do here. I don't want to just be an average performer. I. I want to do an extraordinary job. Here's what I've been doing for the last six months. Here are my achievements, by the way, written out, of course, briefcase, technique, style. And you say, I want to do an extraordinary job in the next six months. And I'd like to ask you, if I do, I'd like to discuss compensation increase. Well, what you're doing here is something very clever. First of all, you're saying you're positioning yourself to help the company. I want to do an extraordinary job for, for you and for the company. You're not talking about you and your stupid salary needs. No one cares about you. Second, what you're doing is you're explaining that if you do this, if you are an extraordinary candidate, you would like to discuss additional compensation. Well, who can disagree with that? Because what the boss is thinking is great. If this person doesn't do an extraordinary job, I just won't pay them more. Perfect. So you do have to do an extraordinary job. There's no tricks about it. You actually do have to exceed expectations. Now here's the critical part. You say, here's what I would think would make me an extraordinary candidate. I've come up with three things. I like to do three to five. Anything more than that becomes highly unmanageable. I'd prefer three. So there are three things. For example, I'd like to drive new users up 25%. I'd like to improve engagement by 15%. And revenues, I'd like to improve those 7%. Okay. And then you can also include some process things like take over this project and manage that and launch this conference successfully. What does that mean? Successfully doesn't mean anything. You have to get deep into the metrics. Successfully means 250 people attend. Great. So you've got a super specific list now of what would make you an extraordinary candidate. They agree, they sign off on it and you say, do you agree? If we do this, you'll actually, you'll discuss a significant salary increase and you'll say, okay, yeah, if we hit these goals, actually. Absolutely. Because remember, if you improve revenue 7%, that's probably going to be worth something to the company. Whatever that number is, it's going to be material to the company. So you go off, you do the work. But here's something most people forget. Don't disappear for six months. Every two weeks, check in with your boss. Hey boss, wanted to let you know, like we're on track for 250 people attending. Oh, just want to let you know, boss, we already exceeded our number. We've got 300 people who are coming and, and 100 people on the wait list. So you're constantly letting them know. Here's why. When you go in for that three month or six month discussion about your salary, it should be no surprise to anybody. You should be walking in and that boss should be like, shit, I gotta write that check. It should not be where you are bringing up a surprise and you're just sort of brandishing him with numbers. No, he knows, you know, everybody knows because you've kept in touch. I call this the closing the loop technique. And, and I explain it more in some of my other material. So that is how you effectively get a massive salary increase. The best part of this is that you have to work for it and your boss feels great to write you that check. Now I've had other people do this they've negotiated salary increases with me. We discussed it on performance, and there is nothing better for a boss than to say, you know what? I'm happy to write you a larger check. You just have to perform for the business as opposed to someone going in there demanding that they want more cash because they simply want to fly to Vegas more often. I do not care about your needs. I just don't. Hiring manager does not care. They care about the business. So position yourself that way and you will be more than likely successful when you go in for your massive salary increase.
