External benchmarking in compensation
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The document discusses external benchmarking of compensation strategies at Ernst and Young compared to other major consulting firms. It provides details on Ernst and Young's company structure, typical job descriptions and salaries for consultants. Ernst and Young's compensation strategy focuses on tightly controlling pay around market positioning and promoting internal growth over external hiring. Reviews analyzed from current and former Ernst and Young consultants on Glassdoor gave the company an average rating of 3.5 out of 5 stars.
External benchmarking in compensation
- 1. EXTERNAL BENCHMARKING IN COMPENSATION Studying the compensation strategies at Ernst and Young vis a vis other major consulting firms SUBMITTED BY: Ritu Kapse: 12 HR 024 Shishir Swaroop : 12 HR 028 Shitanshu Singhal: 12 HR 029
- 2. Flow of the Presentation What 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
- 3. 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
- 4. 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
- 6. Company Structure for a consulting firm MD/CEO PARTNER MANAGER CONSULTANT ANALYST/ASSOCIATE
- 7. 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.
- 8. Salaries across Big 4 Consulting Companies 1100000 1050000 1080000 1020000 1010000 1000000 950000 919000 900000 850000 Figures in INR 800000 Deloitte EY PWC KPMG
- 9. Salary Break Up Sales Basic Pay Cash Bonus Tips 1% 135188, 14% 859761, 85%
- 10. Compensation Strategy 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.
- 11. 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 them to Consultants promote 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
- 12. Review from Employees We analysed the reviews posted on Glassdoor, of 50 current and Ex- employees at Ernst and Young designated as Consultants. Consultant Reviews 3.5 4.5 4.5 3
- 13. Sources of Information Glassdoor.com Payscale.com Ernst and Young Associates Wikipedia ey.com linkedIn.com SIHRM