Mr.

Rajesh was troubled while preparing the annual salary budget for his retail chain, Rigs retail. It had 100% growth on almost every year. Rigs retail used to be a good poaching ground for other retail companies. Last year, 160 junior marketing executives left to join rival companies. Even though the fixed and variable ratio of salary was 50:50 and company had already achieved brand identity. Rajesh being an innovative compensation administrator, he designed compensation structure in such a flexible way that an employee could earn twice their average monthly salary. Every customer care executives were trained to educate customers and they used to get bonus points for repeat customer purchases. At the end of the year, based on the accumulated bonus points, these employees got surprise incentives. Even then employees started quitting the job in Rigs retail. Rajeshs friend Deepak worked for a multinational company, suggested Rajesh to concentrate on designing a compensation plan considering the career development initiatives of employees. Another friend of Rajesh, Ajay, gave a different idea that is to make deferrals attractive and focus on long term strategies. a) What would you suggest for the above situation? Justify b) Is Retention of employees possible with proper Compensation plan? Explain.