How to Decide Salaries and Raises with Confidence

TL;DR)

• Stop paying for hours worked; start paying for value created.
• A business’s main goal is to get the most value for the best price. This creates profit, which fuels growth.
• Define every job with a “Role Value Scorecard” that lists 3-5 key metrics showing how that role helps the company win.
• Use this scorecard in reviews. If the metrics are hit, a raise is justified. If not, you have a clear plan for improvement.
• This removes emotion and empowers employees to own their growth and earning potential.

Let’s Talk About Pay

Salary conversations are awkward.

They can feel personal, emotional, and disconnected from the real work being done. As a business owner, you want to be fair, but you also have to protect the health of your company. You guess, you negotiate, and you hope everyone feels okay about it afterwards.

But what if it didn’t have to be a guess? What if you could make every decision about pay with total confidence?

You can. You just need to stop thinking about what people are worth and start measuring the value they create.

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The Big Mindset Shift: Pay for Value, Not Time

For most of history, we’ve been taught to trade our time for money. You work 8 hours, you get paid for 8 hours. This is the employee mindset.

The owner’s mindset is different. An owner understands that the business must generate a profit to survive and grow. Profit comes from one simple equation: the value you create must be greater than the cost to create it.

Your company’s goal is to pay as little as possible for the highest amount of value.

This isn’t about being cheap. It’s about being sustainable. When you apply this thinking to your team, it creates incredible clarity. Instead of paying for someone’s time, you start paying for the tangible results they produce.

When an employee knows exactly how to create more value, they have a clear path to earning more. It’s that simple.

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Some Roles Make Money, Others Save Money (And That’s Okay)

Before you can measure value, you have to understand it. Inside any business, there are two basic types of roles.

1. Value Drivers (Revenue Focused)

These are the people who directly bring money in the door. Think of your sales team, your marketers, and your product developers. Their success is often easy to measure in dollars and cents.

2. Value Supporters (Operations Focused)

These are the people who make sure the business runs smoothly so the drivers can do their job. This includes operations, administration, HR, and finance. They create value by protecting the company’s time and money, making everything more efficient.

Both roles are absolutely essential. A car needs an engine (driver) and a chassis (supporter). But you can’t measure them the same way. The key is to define what “winning” looks like for each.

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Introducing the “Role Value Scorecard”

This is where it all comes together. The Role Value Scorecard is a simple, one-page document that makes value visible for everyone. It turns a vague job description into a clear mission.

It has just three parts:

• Core Purpose: A single sentence explaining why this job exists.
• Key Outcomes: What are the 3-5 most important results this person is responsible for?
• Metrics: How do we measure those results with real numbers?

Building this scorecard for every role in your company is the most powerful thing you can do to bring clarity to your team.

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How to Create a Scorecard for Any Role (With Examples)

Let’s make this real.

For a Value Driver (e.g., Salesperson)

• Core Purpose: To turn qualified leads into happy, profitable customers.
• Key Outcomes & Metrics:
  1. Generate New Revenue: $15,000 in new monthly recurring revenue (MRR)
  2. Acquire Customers Efficiently: Keep customer acquisition cost (CAC) under $500
  3. Close Deals Consistently: Maintain a 25% lead-to-close rate

For a Value Supporter (e.g., Operations Manager)

• Core Purpose: To make the business run more efficiently, saving us time and money.
• Key Outcomes & Metrics:
  1. Increase Team Productivity: Ensure team utilization rate stays above 85%
  2. Reduce Wasteful Spending: Cut operational software costs by 10% this quarter
  3. Deliver Projects Faster: Reduce average project completion time from 20 to 15 days

See how clear that is? There’s no room for confusion. Everyone knows exactly what they need to do to win.

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The New Way to Talk About Raises

With the scorecard, performance reviews and salary talks are no longer emotional. They’re objective.

The conversation is simple. You pull up the scorecard together.

Scenario A (The Win):

“Hey, let’s look at your scorecard. You crushed your revenue target by 20% and brought our acquisition cost down. That added a direct, measurable profit to the company. That performance absolutely justifies the raise you’re asking for. Great work.”

Scenario B (The Growth Opportunity):

“Let’s look at the numbers. It looks like we’re falling short on the project completion time metric. This is costing the company money and delaying client results. Let’s build a plan together to get that number on track. As soon as you hit that goal, we can immediately revisit the conversation about a raise.”

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This approach puts your employee in the driver’s seat. It’s not about you “giving” them a raise. It’s about them earning it by creating clear, undeniable value. It’s the fairest system there is, and your A-players will love it.

Ready to bring this clarity to your team?