Group 5 Members

Darshita Agarwal 16PGHR15

Jatan Mehta16PGHR24
Nikhilesh Chhabra 16PGHR28
Poyal Biswas 16PGHR32
Ravi Agarwal 16PGHR39
Rijul Jain 16PGHR40

IN A WORLD OF PAY
CHARACTERS OF THE CASE
Renate Schmidt Head of HR Department
Anne Prevost Director of Marketing, Xon Technologies
Jrgen Mehr Typwares European Head of Marketing
Thomas CEO of the firm
Rainer Barth Contact at the consulting firm
INTRODUCTION
Typware is a German software company whose new strategy is to
increase their international revenues by 10%
Anne Prevost, who engineered a huge uptick in sales for a company
called Xon technologies located in the US, is ready to jump ship--provided
Typware makes her a good offer.
But the salary she demanded is nearly as much as Jurgens, the
European Head of Marketing
consultants who helped negotiate compensation for overseas employees
recommended variable standards depending on the employee's location
CEO Thomas asked Renate to draw up a salary structure for Anne, Renate
consulted with Anne to draw any conclusions about how to structure her
salary. But she didnt get any clear answers.
RENATE SCHMIDT
largely unprepared and unable to come up the solution to
theproblem the company is having in hiring a new employee
lacks the knowledge necessary forsuch an issue, like information
on competitors international hiring policies and on
compensationpackages at other German multinationals
leads to her difficulties in coming up with an adequate offer for
potential hire Anne Prevost
ANNE PREVOST
director of marketing at her previous job at Xon Technology, an
American software company
an intelligent strategist with a deep understanding of the
globalsoftwareindustrywhichwouldmakeheranexcellentadditio
ntotheTypware organization
She has another competent offer from a startup, Seistrand
Systems. But she is more interested in joining Typware, provided
she gets the right compensation.
THOMAS GUTSCHEIN, CEO
primarily concerned with growing the companys global market
is of the mindset that they should pay whatever it takes to
accomplish market leader position
This leads to a number ofexpatriate deals without business logic to
support them
seems uninterested in stabilizing the salaries, which vary widely for
overseas employees and those working in-country
ARGUMENTS IN FAVOR OF
HIRING ANNE
has several of the ideal traits a candidate is required to have for such a global
marketing position
the fact that her division at her previous employment had great performance
even during trying economic times, she is no doubt more than qualified
added advantage is her fluency in German and her experience working at a
German multinational sometime in the 1990s, which would make the transition
smoother
Typwareneedsanemployeewithherkindofinternationalfar-reaching experience
as they strive for even greater growth in the global markets
the company has been searching to fill this particular position for some time,
without success, until Anne was approached
Another significant point is that if Typware did not hire Anne, a competitor of
theirs would and that could be a costly mistake for the company
ARGUMENTS AGAINST
HIRING ANNE
tensions already high among certain employees in the company
over the lack of uniformity or structure in the pay system
bringing in a new hire from the United States and paying her
significantly more than others working there longer in similar
positions, would cause even more discontent in the ranks
Renate Schmidt as the head of human resources, seems
unprepared in dealing with the intricacies involved in putting
together an international compensation package
HUMAN RESOURCES ISSUES
Pay Structure Guideline
Compensation Package
QualitiesoftheHumanResourceHead
COMPENSATION STRUCTURE
FOR ANNE
More information needs to be known about Anne Prevosts previous compensation package
at Xon
10% increase in base salary over her Xon base, to account for the cost of living differences
should also be eligible toreceive an attractive bonus basedon her performance
Relocation services should be adequately provided for and support for all civic, utility, work
permits should be provided
Anne would also need household and day care services for heryounger children
One year of language and cultural training should be provided to Anne and hersons to help
her and her family adjust to local conditions
Apartment rental may need to be subsidized and loans could also be arranged to help Anne
buy necessary household goods
At least two trips should be provided to Anne and her family to the United States every
year to visit her mother
COMPENSATION STRUCTURE
FOR ANNE(CONTD.)
Another alternative could be to hire Anne on a temporary
assignment basis
This will make Anne more comfortable since she will not need to
break off all ties with her home country
Anne could also avoid paying heavy German social security taxes if
she enters a contract of less than five years. The issue of double
taxation can be avoided
Stock options can be issued