Work! And thou shall receive..

NEW DELHI: More than 80 percent organizations rate individual performance as the most important criteria for decisions regarding salary increases. According to the 'NASSCOM Hewitt Total Rewards Study, 2004', organizations also reported having differential compensation positioning based on the performance of employees. The study also shows that an increasing number of organizations lay emphasis on variable pay and align rewards to business goals, with more than 85 percent organizations having a prevalence of variable pay.






"Increasing number of organizations are using the pay for performance philosophy, to build a high-performing organizational culture, which then translates into better business results and company profitability," said Hewitt Associates Asia Pacific consulting business leader Nishchae Suri.





Among other findings, the study revealed that the average accession rate in both, the IT and ITES industry, to be higher than the attrition rate. However, attraction and retention of employees remain key issue for IT and ITES organizations, with IT industry reporting an average attrition rate of 18 percent for the financial year March '03 — April '04 and ITES industry reporting a higher average attrition rate of 32 percent across levels.





In comparison to last year, Indian IT organizations have reported a four percent increase in compensation with 95 percent organizations using market data for pay related decisions. A similar trend was observed by 89 percent of the ITES survey partners. Both IT and ITES Industry saw an average increase of 8-9 percent on median salaries across levels in comparison to 2003.





Organizations are focusing on learning and development initiatives, reporting an average training budget of 6-8 percent of the total employee cost, an increase of 2-4 percentage points from last year.