How To Power Negotiate Your Next Bonus
A raise in your base salary is a permanent source of increased income. However, to increase your take home pay, you can also negotiate performance bonuses on specific projects, activities, or time frames. In the sales world bonuses are often called commissions. That is, a person is paid a salary plus commission for a certain level of sales. However, even if you are not in sales, you can find ways to earn extra income by negotiating win-win solutions.
It's all about increasing profit for the company or your department. For example, let's say you are part of a project with a $100,000.00 budget and a 10-week timeline. In simple terms, the project average is $10,000.00 per week ($100,000.00 divided by 10 weeks = $10,000.00 per week.) You approach your boss, the project manager, and/or other decision makers with a question such as "How would you feel about setting up a special bonus to encourage excellent performance. Can you think of a workable approach?" Of course, you will have already thought things through and will have a couple approaches of your own.
You might say, "If I can find a way to complete the 10 weeks worth of work in 8 weeks without compromising safety or quality, how would you feel about giving me a 10% bonus on the savings?" Let's do the math: You save 2 weeks off the schedule decreasing the cost by $20,000.00 (2 weeks at $10,000.00 per week.) This saves the company $20,000.00 and all you are asking for is 10% or $2000.00 of the $20,000.00 saved. The company wins and you win. In this case, you earned an extra $2000.00 and the company gained an extra $18,000.00. Don't worry: Once you show a track record of being the kind of person who can create these types of win-win's, the more you can negotiate down the road. Fifty-fifty has a nice ring to it!
Following are some ideas where you might negotiate a bonus scenario in your organization:
-- Special projects
-- Increased efficiency of operations
-- Decreased sick leave
-- Budgetary savings through increased efficiency in purchasing, inventory control, distribution, etc.
-- Decreased turn over of employees, customers, vendors, etc.
-- Training and development savings through leveraging in-house expertise or bringing in outside experts instead of sending people to outside training
-- Researching better rates on telephone services, vendors and suppliers, business materials, capital equipment, etc.
In any organization there is unlimited opportunity to find ways to do things more efficiently and effectively. If you keep your eyes and ears open, you can often find these opportunities and translate them into more money in your pocket.
Dr. Dan Strakal has been an expert on the changing workplace, job transition, and career development for nearly 20 years. He acts as a trusted client advisor and consultant within the corporate sector, government agencies, civic organizations, small businesses, and educational institutions. He also provides business, executive and career consulting, coaching and workshops for individual clients and is the coauthor of and contributor to two books, Better Job Search in 3 Easy Steps and Better Job Skills in 3 Easy Steps. Dan is often called upon by the national and international media as an expert and has appeared in The Wall Street Journal, Self Magazine, SmartMoney.com, Computerworld, Diversity Inc. Magazine, Chief Information Officer (Australia's Magazine for Information Executives), the Radio America Program: News You Can Use, KBS Radio Canada and many other media outlets. He is on the Board of Directors of the Career Planning and Adult Development Network and is a Platinum Member of the Career Masters Institute. More info at http://www.capable-consulting.com