Which is more important to you: more money, or more time off?
For most people, this question is a hard one. Firstly, because we usually want both: more money and more time off. And secondly, whether we plan it this way or not, more time off generally involves spending more money.
Ideally, we want to earn more money in less time. But who wants to pay someone more for less? Name any employer or customer who wants to pay more money for fewer hours worked, and there will be a stampede to their door.
So how can we sensibly pursue both objectives?
It should be immediately apparent that we are unlikely to succeed by negotiating on the basis of our previous hourly rate. Even if we can provide convincing evidence that others are charging more, or that we are doing an outstanding job, most customers will take a lot of convincing. We may of course threaten to leave, in which case we had better have Plan B worked out. And even then, Plan B is often negotiated by reference to Plan A. Catch 22 you see.
If we are to successfully achieve more income in less time, we usually have to shift the entire basis of reward.
It is rare for us to point to our outstanding performance or commitment. In fact, the harder we do so, the more the other party may search for counter arguments. Or look for ways they can get the same service elsewhere.
Let’s go back to first principles. The only reason why anyone buys from us – as employer or customer – is that they derive more value from the transaction than the costs they incur.
So the solution to our conundrum lies not with the costs but with the value. And the time to establish the value is before (not during) the negotiation.
Therefore we generally need to begin this process of value-determination 3-6 months before the next appraisal or negotiation.
Here are some of the techniques I explore with my VIP Mastermind Members:
- Getting clear about the outcome of what you do versus the value of what you do. “Meeting the deadline” may constitute a successful outcome, but the value lies in why that deadline is important. Most people are highly focused on outcomes, but insufficiently clear about value.
- The value of what you do is often hidden, so we need the tools to uncover it… the “hidden value conversation”. For example, developing the habit of asking, “why is that important?”
- Learning to quantify value – even speculatively or hypothetically. Like beauty, value exists in the eye of the beholder: value is always a perception. Perceptions only exist when the light of attention is shone onto them. Without attention, there is no value.
- Asking the right budget questions before we are asked to quote a fee, a salary, or a rate. Learning to frame these questions in the right way, and in the context of value.
- Not writing proposals for people or organisations who don’t have budgets.
- Confidently asking for what we are worth and dealing with objections.
With the right guidance, it is possible to get dramatic fee increases. Where are you deriving the value for your customers?