Two business headlines appeared on the same day that highlight the importance of knowing your value and being confident enough to demand compensation for that value.
The first headline announced that Payless Shoe Stores was filing for bankruptcy protection; the second heralded Panera Bread Co.’s sale for more than $7 billion dollars…a significant return for its shareholders.
Payless is a low-price strategy company while Panera has always employed a premium price strategy. What does this mean for you, your confidence, your future success…as well as your kids’ future?
Confidence and strategy
I’m not suggesting that the people at Payless were any less confident in their strategy than the people at Panera. Many companies embark on a low-price strategy with a desire to give their customers more for their dollar…a worthy, but often devastating goal evidenced by the number of bankruptcies of low-price strategy companies.
What I am suggesting is that it takes confidence to demand fair compensation for the value you provide. That’s as true for individuals as it is for companies. Remember, compensation comes in many forms. It’s not just the monetary rewards, it’s the psychic rewards as well. We all want to be recognized for the value we provide.
For companies it’s a badge of honor to be recognized as the gold standard in their industry, to make the Fortune 100 best companies to work for, to be a prime vendor to their customers. For individuals, it’s being credited with the ideas they generate, the improvements they effect, the superior work they do, and the praise the company’s customers lavish upon them.
What does this mean for you? It means that, whether you’re a business owner or employee, you don’t accept less than fair compensation for the value you provide…that you’re confident enough to walk away when your value isn’t appreciated.
In 1970 then President Nixon established wage and price controls to counter inflation. The law put a cap on the size of the wage increases that a company could offer its employees. I was working for a national CPA firm at the time. When it was time for my raise I told the partners in the firm that I hated to leave, but I felt that I needed to do so given the restrictions on salary increases the law imposed. Their response?
They said that the law stated that “on average” they couldn’t give more than x percent in wage increases, but that on an individual basis they could do what they wished. They increased my salary by a percentage more than twice that permitted “on average” under the law. The key to getting this increase was my confidence in my ability to produce results and the knowledge that there are always companies looking for people who can produce results.
Here’s what I’d like you to do:
- Create a list of your accomplishments.
- Assess the value of those accomplishments to your customers or the companies that employed you.
- Determine your value as a percentage of the value you created.
- Ask people whose opinion you value, and upon whom you can count on for a candid response, what value they see in what you accomplished…very likely much higher than the value you ascribed.
- Use this information to help you raise your prices, get a salary increase or get the promotion you’ve always wanted.
Through this simple process, you’ll come to know your value and gain the confidence you need to be fairly compensated for that value.
For your kids
At the risk of repeating myself, remember that your kids emulate your behaviors especially when they see them working to your advantage. The more frequently you employ the steps outlined above, not just in business but in personal relationships as well, the more likely your kids are to discover their own value and prize it highly.
When your kids do something exceptionally well:
- Ask them how it makes them feel so that they get used to being aware of the psychic rewards their efforts afford them.
- Ask them how their efforts enriched the lives of the person they helped.
- Ask them how much value their accomplishment created.
- Let them know that much of the good we do is rewarded psychically rather than monetarily.
- At the same time, let them know that when a transaction is involved…a price for goods or services or pay for work performed, they need to use the value they created in determining their value.
- Remind them of the Payless and Panera results; they see the consequences of getting compensated well versus not getting fair compensation.
You’ll help your kids develop the confidence they need to demand the compensation they deserve ensuring them a psychically and financially rich life…a life others desire.
Increase your confidence, check out my weekly tip and exercise at TeachingConfidence.com.