Mpo

COMPENSATION

PRESENTED BY –

GROUP 5

COMPENSATION -

Value of Job

Contribution & Performance

Monetary & Non Monetary Rewards

Objective of Compensation• To acquire qualified competent

personnel

• To retain the present employees

• To secure internal and external equity• • To ensured desired behavior

Fixed

Variable

Deduction

BASIC + HRA +Travelling allowance +Medical Reimbursement+ DA

Fringe Benefits , Perks , Incentives

Provident Fund + Professional Tax

Compensation

WHAT TO PAY ??????JOB EVALUATION

DIVIDING IN GRADES

PAY FOR KNOWLEDGE

SKILL BASED PAY

Broad banding

Factors Aff ecti ng compensati on

Remuneration in comparable industries

Firm’s ability to pay

Productivity Union Pressure

Cost of living

Government Legislation

SOME PEOPLE PERFORM BETTER AND ARE MORE PRODUCTIVE THAN OTHERS

BETTER PERFORMING EMPLOYEES SHOULD RECEIVE MORE COMPENSATION

PART OF COMPENSATION SHOULD BE TIED DIRECTLY TO PERFORMANCE AND RESULTS

SOME JOBS CONTRIBUTE MORE TO ORGANIZATIONAL SUCCESS THAN OTHERS

NEED OF VARIABLE PAY

Individual

GROUP

Oraganizational

9

INDIVIDUAL PERFORMANCE MUST BE IDENTIFIED

INDIVIDUAL COMPETITIVENESS MUST BE DESIRED

INDIVIDUALISM MUST BE STRESSED IN THE ORGANIZATIONAL STRUCTURE

Necessary Conditions For Individual Incentive Plans

Individual Incentives

Types-

Halsey Premium Plan , Rowan Plan , Straight Piece Rate , Differential Piece Rate System , Taylor’s Piece Rate Plan , Merric’s Piece Rate Plan

Conditions for Successful Group/Team Incentives

10

Some other methods for Variable incentives

• Profit Sharing• Gain Sharing• Employee Stock Ownership Plan • Bonus• Awards• Recognition Awards• Gratuity Pay

PAY PHILOSOPHY at BIRLA GROUP

LINK REWARD TO VALUE AND BENEFITS

FLOWING FROM BUSINESS STRATEGY

INTEGRATION WITH BUSINESS STRATEGY

Moderate towards Variable compensation

We believe in long-term Incentive plans

% increments are higher at junior level

Fixed + Variable plan

60 % + 40 % (senior level)

40 % + 60 % (higher level) Pay of variables at last quarter of the year

PLAN INCENTIVES ARE NOT SEEN DESIRABLE

PLAN DOESN’T INCREASE THE BASE PAY

PLAN REWARDS TEAM/GROUP RATHER THAN INDIVIDUAL

CHALLENGES WITH VARIABLE PLAN

KEY to SUCCESS

HARDWORK * PERFORMANCE = REWARD + SUCCESS