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Procurement Compensation

October 29th, 2007 at 06:50am David Bush - Iasta

Flipping through my ever increasing stack of Purchasing magazines, I noticed an article titled Purchasing Compensation: How to Negotiate a Higher Salary that I missed this summer which is actually quite interesting. Especially since it started off with the most important advice for anyone asking for a raise: know your value. Do your homework before you sit down for a negotiation.

As some of my fellow bloggers are quick to point out, demand for purchasing professionals is on the rise. Results of Purchasing’s most recent annual survey indicated that compensation rose by 6% last year, compared to the average increase of 3.6% for other professionals. According to Tonia Deal Consultants in Ohio, a candidate at market value can receive a raise of 12% to 15% simply by accepting a new position in supply management.

The article notes that a good time to approach your manager about your salary is if you’ve been with a company for a period of time and have not had a raise and your research shows that you’re not compensated at a level on par with your peers, or if your responsibilities have significantly increased. Put together a business case for the meeting. As a purchasing professional, this is a skill that should be well honed.

If you’ve recently completed a certification, such as the C.P.M. (Certified Purchasing Manager) or the S.P.S.M. (Senior Professional in Supply Management), or an advanced University Degree, this can also be used to your advantage in a negotiation. If your company does not see the increase in your value as a result, it’s certain that someone else will.

If you’ve done your homework, and you feel you are due for a raise, and management does not, then it might be time for a move. The article offers some questions that you can ask to help you tell when the time might be right to move on.

A purchaser needs to look at his or her professional growth path. Define yourself in terms of what you want to accomplish in supply management.
Who are you working with now? Are they going to help get you to your goals?
Compare the performance of the organization to the first two. If you see that the company is not heading in the same direction, then it may be time to put out feelers.

The article concludes with five tips from Lovering Consulting for purchasing pros negotiating a salary increase.

Have self confidence. When you negotiate your own salary, you need to feel good about yourself.
Have reasons for the raise. Keep track of contributions and value-add to the organization. It’s your best leverage.
Know your boss. What makes him or her tick? The more you know how your boss thinks, the more your argument will sing. That means you need to listen, and spend time nurturing a relationship with your manager.
Separate emotion from argument. A salary negotiation is not about personal relationships. It’s about your major contributions. You want to get paid fair and reasonable money for what you do. Keep that in mind: Fair and reasonable.
BATNA (Best Alternative to a Negotiated Agreement from the book Getting to Yes Faster by Roger Fisher and William Ury) What are you going to do if negotiations fail? You should be thinking this before you sit down with your boss - what is my BATNA? Another offer, another company. Have a back-up plan that hopefully you never have to use. Having BATNA in your back pocket like an insurance policy will make you more self confident, says Lovering.

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