Compensation as a Strategic Tool in Talent Management

1. National HRD Network
Compensation as a Strategic Tool
in Talent Management
in Talent Management

2. Meet the Speaker
Bimal Rath is Head HR for Nokia in South Asia. He has previously worked for
organizations like the Tata Group and British Telecom in senior HR roles, spanning
across HR Strategy, HR service delivery, Joint Venture relationship management and
specialist HR areas. His professional interest areas are in Compensation and Benefits,
Organizational Design and Leadership development. Bimal has been involved actively in
HR associations like National HRD Network. He also takes time off to teach in renowned
management schools.

3. Managing Talent
Talent Pipeline: an ‘organizationally facilitated’ pipeline of talent that consciously focuses on
providing developmental and growth inputs to key talent in order to create a pool of leaders
Talent Productivity = Entry – (Organizational Filters + Employee choices)
Level Resourcing Filters (internal) Development Retention
• Talent Reviews
• Entry level hiring
• Mobility / language • Individual Dev plans
Junior • Opportunities for
• Individual aspiration (via • Rotations and Short
Talent assignments
dev dialogue) assignments
P • Functional Competencies • Leadership programs
• Better than peer
compensation
R • Lateral recruitments • Talent Reviews • Development Centers • Opportunities for
• Selection framework • Mobility / language • Cross functional / geo rotation assignments
O to assess long-term • Individual aspiration (via • Coaching / mentoring • Savings
C fit with strategic
direction
Dev dialogue) • Leadership training • Lifestyle compensation
• Leadership competence • MTIP/LTIP
E
S • Lateral recruitments
• Talent Review • Development Centers
• Mobility / language • Lifestyle compensation
S • Selection framework • Individual aspiration (via
•
•
Cross functional / geo rotation
Coaching / mentoring program • Recognition
Senior to assess long-term Dev dialogue)
g )
• Leadership experiences • Long term savings
Talent fit with strategic
ith t t i
• Functional Competencies • Retirement savings
direction
• Cross-geo experience
Employe Integrate:
Attraction This can be add
e sees •C&B / devt
needs right on to
reward framework
C&B compensation
ti
vs effort •Recognition
strategy
3 © 2005 Nokia
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4. Some practical issues
Some practical issues
•Is attraction supported by market competitive compensation ?
•Is mobility seen as financially attractive? Particularly international?
•Do people feel that they have enough choices of lifestyle based on
compensation levels and practices?
•Can employees build assets?
•Is their own and family’s future somewhat secure?
•What is seen as fair and equitable how is it communicated?
What equitable—how
•How does an employee feel if he stays long enough in an organisation—well
rewarded, a little shortchanged or having lost an opportunity to save and
earn?
•Is there a good connect b
I h d between the organisation culture, and l d hi
h i i l d leadership
walk the talk, particularly on compensation?
4 © 2005 Nokia
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5. Meet the Speaker
P. Senthil Kumar is Director – Human Resources and Administration for Cairn India. He is
responsible for strategic decision making in the areas of HR policy, compensation planning,
recruitment and performance management in the organisation. Senthil holds a Post
Graduate in Personnel Management and Industrial Relations from Xavier Labour Relations
Institute (XLRI), Jamshedpur and a Bachelor’s degree in Technology (Chemical Engineering).
In a career spanning more than 23 years, he has made significant contributions as a Human
Resource (HR) professional.

6. Compensation as a Strategic Tool in Talent
Management
P Senthil Kumar- Director-HR & Administration

7. Not Compensation but Rewards
'Compensation', it's a quite a conservative approach and also has
a negative connotation in itself!
‘ Reward’, A Progressive and positive approach to fair Employee
Remuneration

8. Cairn India – 2007
Total Rewards
Complete Package termed “Total Rewards includes:
Total Rewards”
Salary
Benefits

9. Cairn India – 2007
Total Rewards CONTD.
Recognition
Quality of Work Life

10. Cairn India – 2007
Wealth Creation
Career Growth
Personal Development Opportunities
p pp

11. Rewards to an Organisation
g
Link Rewards to an Organization's 4 main life cycle stages :
Growth
Stabilization
Maturity and
Decline
irrespective of what Sector or Industry one operates in .
The Reward Levels is always Benchmarked to the right 'Marketplace
Salaries' and not just 'Internal Measures'.

12. Reward Mix
Growth Stage( Startup Companies) Reward Mix should be on :
g ( p p )
High on cash components
Substantial in Benefits
Low Variable pay (STI/MTI)
None on wealth creation (LTI/Stock Options)
Stabilization Stage :
Lesser cash component
More on Benefits
Higher on variable Pay
Bit of wealth creation

13. Cairn India – 2007
Reward Mix CONTD.
Maturity Stage:
Focus on consolidation of the Benefits
Quite High onus upon variable pay
Adequate wealth creation
Decline Stage :
Cash
C h component get F
t t Frozen
Focus on wealth creation comes down
Benefits get stabilized
Very high variable pay mix

14. Cairn India – 2007
Healthy Reward Philosophy
y p y
A healthy Reward philosophy is always based on a right blend
of :
'Pay for Role' through Fixed Salaries
'Pay for Performance' via Variable Pays

15. Cairn India – 2007
Healthy Reward Philosophy
y p y CONTD.
'Pay for Skills' by way of Skill Allowance premiums
y y y p
Focus on total value propositions

16. Cairn India – 2007
Differentiate the Talent Pool
Differentiate the ‘Talent Pool’ & create variable Reward
strategies , keeping ‘ Different Strokes for Different Folks’.

17. Cairn India – 2007
Rewarding Employee…NO NO…?
g p y
Rewarding Employee on the following basis are strictly No,
g p y g y
No, No, in today’s Market scenarios :
Personality Factors
Halo Effects
Recency Impacts

18. Thanks
Thank you for your participation
For Question & Feedback
For Question & Feedback
please email at ankur@hrtalks.in