1. COMPENSATION STRATEGY
OF
Presented By-
Juhi Priya
Monica
Piyoosh Bajoria Aakriti

2. ABOUT TCS
• Industry IT services , IT consulting
• Founded 1968
• Founder(s) J R D Tata
• Headquarters Mumbai, Maharashtra, India
• Key people Ratan Tata (Chairman)
N. Chandrasekaran
(CEO & MD)
• Revenue US$ 10.17 billion (2011/12)
• Profit US$ 2.2 billion (2011/12)
• Employees 254,076 (Sep 2012)[2]
Piyoosh Bajoria

3. • TCS is one of the largest private sector employers in
India, and the second-largest employer among listed
Indian companies (after Coal India Limited).
• In the 2011/12 fiscal year TCS recruited a total of
70,400 new staff, of whom 61,055 were based in India
and 9,345 were based in the rest of the world.In the
same period a total of 30,431 staff left employment
with TCS, leaving a net increase of 39,969, of whom
36,232 were based in India and 3,737 in the rest of
the world.
• TCS has announced plans to recruit 60,000
graduates in the 2012/13 fiscal year.
Piyoosh Bajoria

4. Compensation Management
“Compensation management is a strategic activity
that helps an organization improve the
effectiveness of its employee reward processes. “
Major components of compensation systems
•Basic Wage and salary plans.
•Incentives
•Employee benefits.
•Performance-based pay
Piyoosh Bajoria

5. Types of Compensation
Direct Compensation
• Wages
• Salaries
• Commissions, Bonuses, Gainsharing, Profit Sharing
Indirect Compensation
• Pay for Time Not Worked (vacation, sick leave, holidays,
etc.)
• Insurance Coverage (medical, dental, life, etc.)
• Income Security (pensions and disability)
• Services(education assistance, child care, recreation,
discounts, etc.)
Piyoosh Bajoria

6. EVA compensation model for TCS
TCS adopted EVA aimed at creating economic value by
concentrating on long term continuous improvement.
This model measured operating and financial performance
of the organization.
Basis for giving compensation to employees.
To assess employees’ contribution, at the company.
 Component of fixed and variable pay were determined
Fixed Pay- wages, pension.
Variable Pay- bonus, profit sharing and stock options.
Piyoosh Bajoria

7. TCS Employee Satisfaction(2003-04)
Parameter Industry TCS
average
Company Image 9.3 9.6
Job Content Growth 9.1 9.9
Training 8.7 10.0
Salary & Compensation 8.2 8.8
Appraisal System 8.8 9.7
People In company 9.1 9.5
Overall Satisfaction 9.2 9.8
Piyoosh Bajoria

8. Pay and Performance Relationship
Feedback to employee
Employee Employee
Employee Performance
considers equity
expects is
performs of performance,
Pay evaluated
job pay
Employee sets new
expectations
based on previous
experiences
Piyoosh Bajoria

9. Incentives Take Home
Doesn’t always need to be “show me da money!”
• Most simple and best option is have doable goals and
agreement with them.
• Recognizing an employee’s contribution is a simple tool.
• On a day-to-day basis, you can use:
Having fun part of work
Job rotation
Expression of appreciation in front of others
Bigger desk
Note of thanks
Challenging work assignments
Piyoosh Bajoria

10. EVA MODEL BY TCS
COMPENSTION MANAGEMENT
FIXED VARIABLE
Piyoosh Bajoria

11. Incentive Plans
1. Individual-In this plan output of each worker can be accurately measured.
2. Group- In this plan output is calculated in group.
Ex-electrical industry.
Advantages of group Incentives are-
1.Better co-operation among workers.
2.Less supervision.
3.Reduced incidence of absenteeism.
4.Reduced clerical work.
5.Shorter training time.
Disadvantages are
1.An efficient worker may be penalised for the inefficiency of the
other members in the group.
2.Rivalry among the members of the group defeats the very purpose
of team work and co-operation.
Piyoosh Bajoria

12. Incentive Schemes In Indian Industry
1.In 1946 incentives plans were introduced in our country.
2.Incentive scheme differ from industry to industry and
plant to plant within an industry.
3.The schemes in public sector plants have an extremely
varied coverage.
4.Inflation has reduced the motivational effect of
incentives.
5.In many industry incentives have achieved their
objectives ,i.e. increased productivity and enhanced
earnings.
Piyoosh Bajoria

13. Benefits and Services
Treats Knick-Knacks Awards Office
•Free •Desk •Trophies Environmen
lunches Accessories •Plaques t
•Festive •Company •Citations •Redecoratio
bashes watches •Certificates n
•Coffee •Tie Pins •Letters of •Office with a
breaks •Broaches appreciation window
•Picnics •Diaries/Planner •Piped music
•Dinner Social Tokens On the job •Flexible
s
with boss Acknowled •Calendars •Movie ticket •More hours
•Dinner gement •Vacation responsibility
•Wallets
for the •Informal Trips •Job rotation
•T-shirts
family Recognition •Coupons •Special
•Birthday •Recognitio redeemable assignments
treats n at office at stores •Training
•Early time- •Representing
offs the company at
•Anniversary, public fora
dating and
birthday
allowances/pr
esents
Piyoosh Bajoria

14. Cafeteria Benefit Plan
Employees are given the choice to select the benefit schemes
Customize benefit programme after assessing employee
needs and preferences
Potential choices : cash, retirement plan contributions,
vacation days, and insurance.
Example one employee may wish to take health care
insurance, while another employee may wish to take life
insurance.
Piyoosh Bajoria

15. TATA CONSULTANCY SERVICES
SALARY INFORMATION
Annual Base Salary Rs. 164959 per anum
1. Basic 65984
2. HRA 32992
3. Medical Reimbursement (On 15000
submission of bills)
4. Transport Allowance 9600
5. Shift Allowance 19800
6. Special Allowance 21584
Piyoosh Bajoria

16. Other Benefits
1. Provident Fund @ 12% on the basic (employer contribution) 7918
2. ESI @ 4.75% (employer contribution) 7123
Annual Gross Salary 180000
Performance Incentives
Incentive Potential upto 20% of Annual Base Salary on successful completion of Expected
Business Results,
payable quarterly.
Additional Benefits Annual
Gratuity as per Payment of Gratuity act, 3174
1972
Mediclaim Insurance premium for Self plus 5 9000
dependents
Personal Accident Insurance coverage premium 500
Piyoosh Bajoria

17. THANK YOU
Piyoosh Bajoria