Ask at Work or You Won’t Receive
It’s time to come clean. I was, or am, (not really sure… once one, always one?) an investment banker. I was in hiding for a while, especially during the early days of the recession. Neither Capitol Hill, the news media, or…well, really anyone… seemed to like my type. But as an investment banker, I gained a lot of experience fighting for my pay every year and hopefully some of that experience will be useful to you.
Most of an investment banker’s pay each year is discretionary. It can go up or down drastically anually, depending on a number of factors, including, how attentive the banker is to the process. Bankers realize that, in order to get paid, you have to ask. You have to meet with your boss before year-end bonus decisions are made, ask him what type of bonus number you should expect, or, tell him what you expect that number to be. Discuss with him your contributions to the group and how that work should be reflected in your bonus. Review the influence that total company performance vs. business unit performance vs. your individual performance will have on your pay.
It’s best to enter a discussion like this knowing the range of pay that colleagues at your same level received the previous year. If you don’t know that spread, ask your boss, or ask him what the spread will be this year. You can always ask. You may not get an answer, but at the very least, you demonstrated your extreme interest in the topic. After your first pay-related discussion, you’ll probably part without an agreement on your compensation level. But the point of your conversation is to give your boss ammunition that he can use when he fights for his people with his superiors. You’ve reminded him what you’ve accomplished and given him an idea of what number you think would be fair. And of course, negotiating theory would suggest you should ask for an amount above what you expect, knowing that you’ll receive something less than that number.
The above approach works well for bankers who have to fight for the level of their bonus every year. So how about you, who are in a different industry? You want to maximize your pay too! Why wouldn’t you? If there is a discretionary component in your compensation, you need to talk to your superior before she decides what level she will offer you. Even if your company offers no bonuses, you can use the model above to discuss salary increases or even promotions with your manager. Your discussions will influence your ultimate pay and seniority.
One experience I had as a senior investment banker highlights this need to be proactive. In my group, although the junior employees reported to my boss, I wrote their performance reviews and, along with my manager, determined their year-end bonuses. When I met with my boss to determine the junior bankers’ bonuses, I found the conversation with my boss pivoted on whether the junior officer would be happy with the bonus number she was given. When I protested that one great performer, Emily, was slated to receive a lower bonus than another, less productive associate, my manager responded “Oh, Emily will be fine with her number. She won’t complain.”
Always make sure your manager knows that you care, and yes, you would complain. But better to communicate early and not have to complain late.