The Hindu : Nasscom, Hewitt to study IT cos. pay structure

Online edition of India's National Newspaper
Tuesday, Mar 04, 2003

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Business

Nasscom, Hewitt to study IT cos. pay structure

By Our Special Correspondent

NEW DELHI MARCH 3. Indian IT companies that claim to be of international class but are parsimonious in compensating their staffers should have reasons to look upon a soon-to-be-conducted study by the National Association of Software and Service Companies (Nasscom) with trepidation.

Along with Hewitt Associates, the association will conduct a survey of compensation and benefit trends for the Indian IT and IT enabled services industry. The study will provide detailed information on compensation, benefits and people practices exercised by Indian companies. It will be released in June.

One crucial component of the forthcoming survey will be compensation. Market analysis of all key compensation components such as salary, loans, conveyance, housing and the like will be benchmarked. Organisations will thus be able to gather information on various aspects of their compensation vis-a-vis the market standard.

The concept was further explained by the Nasscom: "The Indian IT and ITES industry is highly people intensive and the salary cost in many cases is more than 40 per cent of total revenues. It is therefore essential that companies devise the right compensation and rewards mix in order to attract and retain talent. Through this year's study we are also, for the first time, aiming to establish benchmarking for Indian IT and ITES companies based on their compensation and people practices.''

If the inaugural survey last year was an indication, employees should not expect consolidated salaries with no relation to performance. It had revealed trends that include the emergence of variable pay as a key performance orientation. Industry leaders also agreed that HR systems were important contributors to building and sustaining competitive advantage.

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