The Monkey and I recently successfully negotiated a pay raise and thought we’d share some things we learned during the process.

Background

Just about six months ago I was offered a rather substantial promotion and pay raise from my previous employer. Everything was great about the package offered except for the fact that my wife and I were a little worried about the extensive travel that went along with the job (2-3 weeks a month).

At about the same time I received this offer I received another offer from a different company in the same field for a similar financial package, except without the travel. After several days of introspection and analysis my wife and I decided to take the job at the new company, as we were concerned about the frequency of travel considering the fact we had a little girl at home and my wife was in the middle of starting up a stay-at-home online business and would need lots of support from me that I wouldn’t be able to give her if I were constantly away from home on the road.

The catch, if you will, was that this new job was a 100% commission sales job, while the old job was salaried, with a smaller percentage of the compensation in the form of a bonus. The good news, though, was that it was an account management-type sales job with very little cold-calling, and established accounts with yearly sales of approximately $1.3M. In other words, the fact that the company was an established industry-leader mitigated most of the risk. Further, through my research, I had learned that most Account Executives were well-paid and extremely satisfied employees. The other good news was that for the first two months I would start off with a substantial commission “guarantee,” while I learned the products, presentations, and personalities of my accounts. Decision: I made the jump.

Reality Sets In

Not long after starting the new job did I begin to notice the effects of the economic downturn that this country is currently facing, particularly in the Northeast. While the company had been growing at a pace of 20% per year, it quickly became apparent that this year would be different. Almost immediately my projections were adjusted to reflected this new reality.

On one level, this was good news, as one of the ways I was to be evaluated concerned whether or not I could hit my monthly sales projections. But the flip side to this was the fact that my commission rate had been set against loftier sales goals, and with lower projections came lower commissions. After about a month into the job I became concerned that once my two-month salary guarantee period was over, I wouldn’t be making nearly as much as I had originally thought. In fact, based on current sales, I figured I would be making about the same, if not slightly less than my “pre-promotion” position at my previous employer. Ooops!

Step One: Recognizing Frustration

At first I became upset thinking I had made a poor decision, leaving a company and products I was comfortable working with. But realizing that this line of thinking was counterproductive considering the reality of my situation and the fact that I couldn’t turn back the hands of the time, I began to perceive this frustration as what it really was: a call to action.

Step Two: Heeding the Call to Action

One of the lessons I have learned in life is that overcoming challenging situations requires careful preparation. One of the most important aspects of preparation is to conduct rehearsals. I can’t tell you how many times my wife and I have role-played with one another when it comes to be fully prepared for job interviews, contract negotiations, and presentations. After rehearsing what I was going to say several times until I felt totally comfortable overcoming potential objections, I made a call to my immediate supervisor explaining my concerns. Initially I was challenged when I pointed to the projections, which had been lowered but were still higher than what my territory was currently yielding. My commitment and confidence in my abilities were questioned. Since I had prepared, I knew exactly how to counter these arguments, and by the end of the call, he was asking specifically what I wanted so that I would be happy. I said I would like a larger commission but also suggested that I would take an extension on my guarantee until I had an opportunity to improve my territory. At the end of the call, he agreed to speak to his boss and assured me that they would take care of me.

Step Three: Committing to the Long Haul: The Art of Persistence

In my view, one of the most important elements of success is the quality of persistence. I will one day write a separate post about persistence itself, but time and time again I have realized that virtually no success arrives at the first attempt, and that when I look at others who achieved success in their field, one of the most ubiquitous commonalities between all of those people is their undying persistence.

In my case, my desire for an extended guarantee was the most important thing for me, but wasn’t the most important thing for my superiors. In other words, every week or so I had to force myself to check in and ask the status of my request. It was sometimes difficult to do this because my ego was telling me that I shouldn’t come across as a whiner or someone who was greedy. I had to constantly realign myself with my intention, which for me wasn’t to simply make more money. As the sole bread-winner in the family, I had huge responsibilities. Earning the compensation I was originally presented with wasn’t a luxury. It was a neccessity if I wanted to simply pay the mortgage and all of our bills. When I continually realigned myself with my intention, I felt more comfortable being persistent with my bosses because I felt comfortable knowing my intention was pure.

Step Four: Taking It to the Top

While initially my boss told me he would take care of extending my salary for me, circumstances would have it that I had to take up my case not with my boss, nor my boss’s boss, but with my boss’s boss’s boss, the co-owner of the company and the head cheese of the sales force. I had to be totally on top of my game in this situation, as this person is a skilled salesperson who himself can effortlessly overcome just about any objection. I knew that if I were to achieve success I would have to sell my case using one of the most powerful, yet often underused techniques in sales: creating a need.

Step Five: Creating a Need

Most salespeople try to close a sale by trumping “features and benefits” alone. The problem is that this technique ignores the idea that successful sales is really the art of transferring emotion about something. Because I had done my research I knew that creating a need was the only way to appeal to this person’s judgment. I literally rehearsed out loud in the shower that morning, presenting my case for an extended salary based on appealing to his emotions and his need to have the best sales force in the country out there confidently representing his brand without worrying about whether or not they’ll make the mortgage that month. When I appealed to his emotion, the case was closed nearly before it begun and I walked away with a four-month extension on my guarantee, with the agreement that this grace period was intended for me to go out there and rebuild the territory feeling confident that my company had my back.

Step Six: Creating a Vision for Your Life: Self-Worth Part I

Not long after securing a four-month extension to my salary did I realize that this solution was temporary. As I mentioned earlier, my territory was underperforming, and even with lowered projections the commission rate was inadequate.

Fortunately I backed up my calls for a more fair compensation structure with strong performance in the field. In fact, without strong performance, or “walking the walk,” all of these negotiations will eventually become moot if you’re not actually the superstar you claim to be, who deserves the best possible compensation package.

The month after sitting down with the head honcho I went out and hit my sales projection, the first time the territory had done that since before I took the job. The flip-side to this was that since the projection had been lowered, hitting goal still resulted in a monthly commission that was still less than my salary guarantee and less than my previous job’s salary. Since my guarantee was established to be the low end of my compensation package I had grounds to reapproach my bosses, this time to readjust my commission rate.

Now I would have the opportunity to look at my goals and decide for myself how much I was worth. Admittedly, this was a tough exercise because I found myself constantly leaning towards a rate that would produce a compensation that would simply help my family to survive, rather than to thrive. I had to do a lot of introspection to realize that I deserved to thrive and that meant I had to take a hard look at my self-worth. I realized that this whole situation was an opportunity for me to change my personal karma and embrace a life of abundance. Coming from a military background, abundance and material success were never part of the equation when it came to career choices. I had to realize that my personal success was entirely up to me and that I could feel proud asking for more, because I was simply asking for what I had now come to accept I deserved. I wasn’t greedy asking for more money. I was finally getting honest with myself and that meant beginning a life of happiness and abundance.

So I called my boss again, pointing to the fact that I had achieved goal the previous month but was still earning less than they had promised me. This time it was a much easier sell because I was came across as successful (achieving goal the previous month) and rational (pointing to the fact that I was simply asking for what was promised when I was hired). I asked for a 2% bump in my commission, accounting for the fact that they would probably counter lower and we would settle somewhere in the middle. I made the smart move of asking for slightly more knowing that sales is always a negotiation and I would most likely have to give a little in the natural give and take cycle that is sales. They came back with 1%.

Step Seven: Knowing When It’s Over: Self-Worth Part II

Because I had done my homework and was willing to continue to come from a place of equity, fairness, and positive self-worth, it soon became apparent that 1% wouldn’t do it from me. While some people might throw in the towel at this point, after asking about 4 times for a pay raise, I had the self-confidence to realize that my job was still not complete. I crunched the numbers, and 1% was still less than what they offered me when I left my previous employer, and knew that in all fairness asking for what they offered me was not only fair and reasonable, but required if I were to be able to continue to look at myself in the mirror.

This time, instead of calling my boss to discuss it verbally, I wrote out a very rational, reasonable argument for an additional .5% commission raise and sent it in an email. (FYI: I normally don’t recommend resorting to email for important negotiations as it is more difficult to transfer emotion in this medium. However, since I had laid the groundwork verbally, I deduced that at this point, a written arguement was the most effective way to state my case. More often than not, email is something of a cop out because it allows us to not have to face our fears in a more immediate context).

I included several excel spreadsheets showing my original offer, what the current package looked like, and how my proposed package equalled my initial offer. I also included a chart showing how I was already turning around the territory, taking it from -11% growth two months previous to my joining the company to +11% growth three months after taking the job, and on pace this month to achieve 15% growth.

Success!

Since my argument was well-researched, reasonable, and came from an energy field that was completely aligned with my feelings of self-worth and confidence, getting final approval on my commission package was the easiest step of the journey. It took about three months of elapsed time, hours and hours of preparation and rehearsal, clear-mindedness, and enormous persistence to pull off getting the pay package I wanted and deserved.

Step 7.5: Never Give Up

The bonus step here encompasses the idea that once you achieve success like this, it is of tantamount importance to back up all of that talk and negotiation with solid results in the field. I am doing that, on my way to achieving oustanding growth and meeting sales projection for the second consecutive month, a great accomplishment for a person so green in the territory.

I always go back to something I picked up during the interview process, when my boss’s boss told me that all he wants from his Account Executives is 100% effort. If I can look him in the eye and honestly tell him I am doing all that I can to grow the business, than that is good enough. When you hire talented people who perform at a high level on a daily basis, success is virtually assured. Granted, there are some factors that are currently beyond our control in today’s economic climate. But a willingness to work hard and achieve creative solutions on a consistent basis in complicated times will almost always result in consistent success.