I'm about to ask for a raise for the first time but I'm not entirely sure how to handle it. I've been with this company for 7 years and only received 2-3% increases the past 3 years. I interviewed at a competitor and they offered me a 20% increase, which I turned down.
During negotiations should I simply ask for them to match? I don't want them to think I'm actively looking for a new job but want to get paid my worth.
I recently asked for (and was awarded) a raise. I have weekly 1-on-1's with my boss (CEO) - they usually go for about an hour & we simply talk about everything happening in the business/team.
At the end, I simply said 'Something I want to bring up is that I've looked at the market and I don't feel I am being paid adequately for the value I'm creating'. I'd be lying if I said it wasn't an awkward conversation. I didn't mention any number at all & was actually met with a slightly negative response, but a week later at the next 1-on-1, it was brought up again & I was awarded a 10% cash raise (I negotiated some ISO's too).
In your scenario, I wouldn't tell them that you interviewed at a competitor either. You can simply tell them that you've looked at other roles & determined market rate as being higher than what you're currently paid. Only use another offer as leverage if you are prepared to leave & take that offer.
Modesty aside, I'll also admit that I'm a high performer in our team & so I already knew that I had leverage. Something I've learned though is that unless you bring it up, it's never going to happen - there is no-one looking out for you unfortunately, so take the initiative & help yourself where you can - it equates to hundreds of thousands of dollars over your career.
I think the dynamic at your company (where you're a direct report to the CEO) is a totally different animal than your standard corporate dev job. When you're working at a place that employs 1000+ people, these types of conversations are much less likely to go in the direction of the employee.
That's true - we're a small (15 person) team & I lead Design & Product so the CEO is my "direct report".
However, just because you have a lower likelihood of success, it doesn't mean you shouldn't ask. If you receive a 'No', it will probably speed up the inevitable decision of whether you actually want to stay with this company (knowing that they aren't going to incentivise your performance).
I would also keep in mind that you should only be asking if you either feel you're being paid lower than market or that you've taken on more responsibility so now your wage doesn't adequately match your role. Just asking periodically without a reason isn't going to work for anyone.
Because you've been at the company for 7 years they may take you for granted. You didn't make any noise or leave when you didn't get a raise for 3 years so they probably don't consider you to be a "flight risk".
Another possibility, is that you've stopped increasing your value to the company. This is normal. Einstein probably wasn't reading patents any faster at 7 years than he was at 3 years when he worked at the patent office.
More importantly to you, the company may not be a place where you can "up your game" any further. You need to seek out new jobs where you can increase your knowledge and value.
Well they requested a quick response and it was a bad time for me to negotiate with my employer. They made it pretty clear that I could contact them if I ever needed a job.
The easiest way to do this is to determine how much value your work has added to the company you work for. If the software you've worked on has added a million dollars in extra profit to the bottom line, that is a good starting point to start from. Secondary business objectives could count as well, e.g. increased customer satisfaction, innovation, etc.
A problem for many people is that it's hard to compute their exact value, or they are afraid to have that kind of discussion.
If you're being paid $75k a year, and you've added a significant amount to the bottom line, I doubt you'll have a hard time negotiating a $10-20-30k increase. Same goes for a new job: give them examples of achievements, and show how you were beneficial to the business.
Negotiating a new secondary offer is a great thing to do; it gives you additional leverage. If there's a chance a value creating employee will leave, there is no reason not to give a raise. You could use that offer to negotiate a 25-35% increase, if you can show the value you've created at your current company.
To put it bluntly, most employees are actually not worth that much. They get hired at the least amount possible, and they execute strategies, for the most part, set by a few people who are paid significant amounts.
The conversation would go something like, I am ready to take the next step in my career, take on more responsibility, company B have offered me a role doing X, Y, and Z, but I'm happy here and would like to stay, is there anything you can do for me?
The trick is, make them think you are not looking, but that others are looking at you.
But you have to have the offer in-hand, and you have to be willing to pull the trigger.
I am unable to negotiate a raise (because I don't even try). I always got (10%-15%) more (in the next job) when I wanted to leave and looked for something else. Usually still having a job that I want to leave but not having to find something immediately allows me to to negotiate a higher salary. OTOH I never left a job just to get more money.
During negotiations should I simply ask for them to match? I don't want them to think I'm actively looking for a new job but want to get paid my worth.