Compensation package: Striking the Right Deal

Money

makes the world go round, and no where is it truer than in the

telecom sector. This is the hottest, fastest growing sector

globally. Being responsible for stock market booms, huge

mergers, and cash rich sell-outs, telecom companies know what

they are worth. Understandably, so do their employees. They know

their skills are in tremendous demand. And their skills have no

borders.

These employees expect to

be treated with the proverbial "kid gloves" and

typically are at the asking end of any compensation

conversation. What makes their position easier is the constant

vying among companies to "poach" that "real whiz

kid".

The telecom sector is

perhaps the most sensitive to compensation differentials where

even small variations encourage employee movement. The type of

work is no doubt an important consideration, but lucre is not

far behind in the wish list of most professionals. In fact,

compensation is noticed as a powerful catalyst not only for job

change but also for driving employees to contribute more to the

business.

So typically what kind of

salary packages do telecom professionals expect? How do I, as an

employee or prospect, know that I have got a good deal? As an

employee, what are some components that you could mention next

time you are in a negotiation situation?

Some tips on how to assess

your current or future compensation package are mentioned below.

Looking at

Your Strengths



A few years back, an attractive package offer may have consisted
of signing bonus, fixed pay, incentive compensation, and

benefits. However, today companies have increased

competitiveness in their rewards package and the monetary

component is no longer a point of sustainable advantage.

Companies are trying to make their "offer" at a more

fundamental level, which integrates employees to their overall

business growth and reputation. They are culling out the real

value of skills available with employee or a prospective and how

this would add up to their broad business objective.

This means that as an

employee, you need to understand what is the business and

accordingly position your skills as a tremendous value-add to

business growth.

What Are

Others up to?



It helps if you can do some quick homework before having a
compensation conversation. Get a rough idea of what your friends

are earning in similar jobs (this is a tough one as most people

would not be willing to share this piece of information!). The

Net is another place you can search. Even if monetary figures do

not get mentioned you can check about various people policies,

work environment, and stock options. This will give you an idea

of what other organizations are like in their overall philosophy

towards their employees. More often than not, companies with

favourable employee policies and a HR-friendly outlook reward

favourably also.

Compensation Menu



Monetary Components

Benefits

Work/life options

Comparing your current or

future workplace will give you some perspective of gaps or

potential areas of discussion.

Soul-Searching



"What are your requirements? What do you need from
life?" Does this sound like philosophy? Telecom isn’t

really! Having a clear fix on your own wants will put you in a

better position in several ways. For example, the type of

compensation mix would vary if you were single than if you had a

family. Maybe with a family you would place a higher premium on

benefits such as medical insurance and health checks. If you

were single, a cash heavy compensation structure may be more

attractive.

Issues You

Need to be Aware of



Some issues are important to your compensation and career. Get
these answered to your satisfaction. For instance:

• Is the
  
  company going to give stock options today or by a later
  
  date? What is the offering?

• What is the
  
  mix of base and performance-based pay? How much is typically
  
  available for high performers?

• What is the
  
  growth in the fixed pay? How often can one expect it?

• What is the
  
  performance cycle like–quarterly, semi-annual, or annual
  
  reviews? Is it matched with payouts?

• Are their pay
  
  differentials across skill groups and product-lines? What
  
  does this mean to your skill set? Is training given for
  
  certain skills?

• Is fixed pay
  
  growth matched with vertical career moves or are their broad
  
  pay grades unrelated to career?

Compensation

Components Available in the Market



When discussing your compensation, you can use the following
table to match the mix of cash based components, benefits, and

work/life facilities you are being offered–and define your own

package based on your need.If You Are

Thinking of Joining a Start-Up




Apart from all the areas mentioned above, start-ups present
unique opportunities. As a result, cash-based compensation may

often not be a major consideration for joining a start-up. You

may also like to consider:

• Extent of
  
  equity being offered

• Faster growth
  
  and career potential

• Fun place to
  
  work

• Greater
  
  flexibility

• More
  
  opportunity to define your own role

• A chance to
  
  do everything

• An
  
  opportunity to create and be part of a dream

• Backing by a
  
  financially secure parent

• Chance to
  
  work with a brand new technology and product

• "Campus"
  
  type culture (night outs et all!)

Your Final

Compensation Decision



There is no "best" compensation. In fact, that is
quite a misnomer. What is "best" is the deal, which

works for you. And this will vary from person to person.

Compensation always has two sides–the total amount as well as

its break-up. Look for both when you sign up.

Also, there are items in

the overall offer, which cannot be quantified but are critical

to your overall wellbeing. Work/life options are one such area.

The whole gamut of HR policies is another. Keep these in mind as

well when assessing compensation. In fact, a study by Hewitt

Associates, a global management consulting firm, identifies

work/life options as one of the most critical factors for

employee attraction and retention.

So make sure you have

touched all bases before taking the final call!