How Much Money Have You Made Your Company Today?

Would you like a foolproof, guaranteed strategy to get a raise? Well, here it is:

Make your company more money.

The people that get raises aren’t the ones that work the hardest. They’re not necessarily the smartest, either.

They simply become a better investment. What do I mean?

You’re Just a Number

I love stories about how people are a company’s greatest asset, about how you’re contributing to something greater than yourself, about how you’re changing the world for the better in a fundamental way. It’s inspiring stuff.

But it’s all crap.

At the end of the day, companies are in the business of making money. The only way a company can pay employees (like you) is if you’re making the company more money then they’re paying you.

Let’s say you’re making $60,000 per year. For the company to justify your salary, you need to make or save the company at least $60,000. Otherwise, they’re losing money on you.

From the same perspective, what if you make your company more $180,000 per year? Then they are receiving three times what they’re paying you. You’re a great investment!

What’s Your ROI?

If you look at yourself like an investment, then you can calculate your company’s return on investment (ROI). Your salary represents the investment. The income or savings you bring the company represent the profit.

To find your ROI, subtract your salary from the revenue you create, and then divide the difference by your salary.

So, using the above example where you make the company $180,000 and they pay you $60,000:

$180,000 revenue – $60,000 salary = $120,000 profit / $60,000 investment = 200% ROI

Let me ask you something. How would you like to earn 200% on your money every year? I know I would.

Of course, this is a fictitious example. For the best results, calculate your own ROI. Divide the amount of money you are making or saving the company by the amount they invest in you and multiply by 100.

Sizing up the Competition

If you’re thinking about buying an investment property, do you make an offer on the first one that looks profitable? Probably not. Chances are, you analyze several opportunities and then make an offer on the one that’s going to make you the most money.

Frequently, it works the same way in the office. If everyone in the office is making the company money, they’re not all going to be treated equally. The company is going to lavish extra attention and opportunities on the employees making them the most money.

So, the next step is to calculate your ROI relative to the ROI of other people in the office. If you’re producing a 25% ROI, that’s pretty good, unless everyone else is producing a 50% ROI. Similarly, you’ll probably get a lot of attention if you have a 100% ROI, when the rest of the company only has a 50% ROI.

You get the idea.

There’s only one problem. Companies don’t always publish a much money they are paying other employees or how much those employees are making them. You might have to guess. Still, if you’ve been with the company for a while, then you probably know who is the best investment.

Your ROI Influences Your Treatment

Generally, the people that provide the most value to the company (i.e., have the highest ROI), receive the best treatment. Those that provide the least value receive the worst treatment.

So, if you’re the biggest moneymaker for the company, you’re probably going to get the nicest office, the best opportunities, promotions, and mentoring from the company. Keep making the company more money than everyone else and you’ll have a good shot at rising to the top.

It also works the other way.

Who do you think the company is going to lay off when they need to start conserving cash? The mediocre investments, of course. If you have a low to middle ROI compared to your coworkers, then there’s a good chance you are next in line to be laid off.

The company might also treat you like what you are: disposable.

Leverage Your ROI to Your Advantage

Are you a top performer? Then use it to your advantage to periodically get a raise.

Here’s what I mean.

Let’s say you’re making the company three times what they pay you. You’re the best investment in the office, and everyone knows it. Unfortunately, you’re still getting paid like everyone else, and you’re starting to feel a bit cheated.

You’ll probably want to complain. Don’t. Instead, start quietly documenting how much money you’re making or saving the company. Build a case for why you are a great investment.

Once you feel sufficiently prepared, take it to your boss and ask for a raise. Once he or she gets over the shock of being presented a business case for a raise, they’ll probably grant you one.

What if they don’t?

Send the documentation of how you’ve performed along to their competitors. They’ll probably be delighted to hear from you. Leaching the best talent from your competitors is a tried-and-true method of grinding them into the ground.

Sooner or later, you’ll get a job offer. Then you’ll have two choices:

1. Show the offer to your employer and tell them you’re leaving unless they give you a raise

2. Don’t even bother. Just take the better job and say good riddance to a company that didn’t appreciate you.

Either way, you win.

Start Making Your Company More Money

Go in to the office tomorrow and look for ways to make the company money. I’m serious.

Is there a problem you can solve that will instantly save the company thousands of dollars?

Do you have an idea that could help the company tap into a completely new market segment?

Is there a client you know should be working with your company, but you’ve been holding back because you’re not being paid a commission?

Figure out a way to become more valuable. Document what you’ve done. Then ask for a raise.

It’s that simple.