It is one of the hardest conversations we have to approach; in the words of Jerry Maguire – “Show me the money!”

With a volatile economy right now in Australia most individuals are ideally looking to retain their positions and maintain their bonuses. For some lucky businesses there is still opportunity to earn healthy bonuses. Here are some key steps to ensure you are successful in securing an increase in salary at the top range of your expectations.

Know the market conditions and market rates – know your value

Market conditions have a significant effect on your salary and whether it’s likely to rise or fall. When the supply of labour is high and demand poor there is a strong market pressure for salaries to fall. When the economy improves and skilled labour becomes scarce as at present the market forces push salaries higher.

It’s important to be aware and be sensitive to what is happening in the employment market and also to what you are worth in the market. You can usually find out this information from job advertisements on the internet or in newspapers or through recruitment consultancies.

Know the company position

Knowing the company’s position on salaries and headcount and its financial health will provide you with more information on how to negotiate. Understanding the company’s position will give you clues on how to approach the discussion. You always want to appear sensitive and understanding to the company’s position even if you are negotiating a rise.

Be clear on how you have performed

Quantify benefits and have examples. The single most important factor on securing a pay rise is you and how you have performed over the past year and how you feel you can add value over the next twelve months.

Obviously the better your performance the stronger your chances of securing a rise. If you have been a mediocre performer, your employer will not feel under any pressure to reward you, particularly if you are paid at the market level. Identify specific examples over the past year where you have added value and performed well both for the company and your reviewing manager.

Similarly it helps your case to be able to identify and outline specific ways in which you can add value over the coming year.

Identify additional responsibilities

Consider what you you can take on that would entitle you to a greater financial reward. If you can identify additional responsibilities that you can take on from other people and you can demonstrate that you can discharge those responsibilities effectively with out affecting your overall performance you will improve your case for a pay rise. Your employer will likely prefer to pay you more than go to the additional expense of employing someone else.

Make it a friendly discussion, not a confrontation

When negotiating in your pay review, it’s important that it is a professional and friendly discussion about your merits. You want your manager to be impressed not only by the merits of your case but the professional way you have presented yourself. While the conversation is friendly and amicable you are likely to achieve this.

Negotiate on cash and benefits

Sometimes it can be easier to negotiate an increase in benefits (e.g. parking, or holiday entitlement or study support) than cash. If you think it will be difficult to achieve an acceptable cash increase then identify a benefit that is of value. It could be awarded to you because of your position that would not set a precedent for the company. If you can’t obtain a cash or benefits increase try and discuss opportunities where your improved performance over the coming year can be rewarded by way of a bonus.

Negotiate in turmoil

Sometimes when the company is in turmoil (departure of key executives, loss of major contracts etc) it can be a good time to negotiate a permanent or temporary (by way of loyalty bonus) increase. Your manager may be pleased to have some certainty and be willing to pay for your loyalty.

Review your goals

Now that you have a pay increase, ensure you conduct a career audit and identify what you want to achieve in the next 12 months.