EXTERNAL BENCHMARKING IN COMPENSATIONStudying the compensation strategies at Ernst and Young vis a

vis other major consulting firmsSUBMITTED BY:Ritu Kapse: 12 HR 024Shishir Swaroop : 12 HR 028Shitanshu Singhal: 12 HR 029

Flow of the PresentationWhat is External Benchmarking

About Ernst and Young

Company Structure for a consulting firm

Job Description for a Consultant

Salaries across the Big 4 Consulting Firms

Salary Break-up for Ernst and Young

Review of Employees

Compensation Strategy

Sources of Data

What is External Benchmarking

Process of comparing an organization’s current policies and practices to that of a competitor organization(s) to determine current and future trends in areas of employment and business practice

This helps in designing a suitable salary structures in the sector

It therefore helps to attain two-fold objectives :

- Attract and retain the right kind of talent - Control Company Costs

About Ernst and Young Ernst & Young (trading as EY) is

a multinational professional services firm headquartered in London

Third largest professional services firm in the world by aggregated revenue in 2012

Provides services in assurance (including financial audit), tax, consulting and advisory services to companies

709 offices in 140 countries.

India’s Head office is in Gurgaon

Ernst and Young

Company Structure for a consulting firm

MD/CEO

PARTNER

MANAGER

ANALYST/ASSOCIATE

CONSULTANT

Job Description for and EY Consultant

Develop Client needs, use cases, system requirement specification

Gather non-functional requirements for the project

Support development and testing team during development.

Review system test cases Review user manual, help files and training

material Work with user experience team in

developing story boards Assist functional teams during user

acceptance testing.

Ernst and Young charges $59 for each hour of a consultant’s work to the client but pays the consultant $5.47 per hour of work.

Salaries across Big 4 Consulting Companies

Deloitte EY PWC KPMG800000

850000

900000

950000

1000000

1050000

1100000

1020000

919000

1010000

1080000

Figures in INR

Salary Break Up

85976185%

13518813%

1%

Sales

Basic Pay Cash Bonus Tips

Tightly controlling pay around a desired market positioning: The key measures for this strategy would include compa ratio and market percentile. In this case, an emphasis on measuring compensation expense ratios or performance differentiation would send the wrong message and promote the wrong behavior.

Compensation Strategy

Compensation Strategy Salary : Lag Strategy - Hire below the median Pay Scale

Skill development - Believes in developing the employees for suitable roles after hiring them. - e g : Tied up with ISB Hyderabad for management programs to be taught to

high performing associates and analysts.

Career/Growth Opportunities - Believes in Promoting rather than External Hiring - Does not go for campus hires for Consultant Profile Recruit majorly for Analyst and Associate roles and then promote them to

Consultants

The firm, unlike other Big 4 firms is majorly into “Process and Performance management.” - Hence they tend to hire people who are Problem Solvers rather than

recruits of other consulting firms who are more in an advisory capacity

Review from Employees

Salar

y

Career/G

rowth

Opportu

nities

Skill

Development

Workl

ife Bala

nce

3.5 4.5 4.53

Consultant Reviews

We analysed the reviews posted on Glassdoor, of 50 current and Ex- employees at Ernst and Young designated as Consultants.

Sources of Information

Glassdoor.com Payscale.com Ernst and Young Associates Wikipedia ey.com linkedIn.com SIHRM