SIKSHA “O” ANUSANDHAN UNIVERSITY
(DEEMED TO BE UNIVERSITY)
IBCS, BHUBANESWAR
CASE STUDY ON
(SUB- CRM)
SUBMITTED BY SUBMITTED TO
MAHESH CHANDRA NAYAK Dr. SOUMYA MISHRA
MBA, 2nd Year (4th Semester), 2022-24
Regd No. 2261301118
SUMMARY:
Ajay Malhotra, Vice President of Human Resources at Cooks Industries, is grappling with the
findings of a compensation benchmarking study commissioned by Amam Consultants. The
study reveals discrepancies in Cooks’ compensation compared to industry standards, leading
to challenges in attracting and retaining talent. Cooks Industries, a Pune-based automobile
ancillary firm, has seen significant success due to its clear delineation of responsibilities
between its two promoters, Ram Prakash and Shantanu Kamble. However, despite its growth
and profitability, Cooks is facing a high employee turnover rate, particularly among engineers
and service functions.
Malhotra’s analysis of the Amam Report highlights several fundamental dilemmas, including
issues related to designations, hierarchies, salaries, taxation policies, and leadership in
compensation. The report places Cooks at a disadvantage in terms of managerial
compensation compared to its peers, necessitating a complete overhaul of its pay packages.
However, Malhotra struggles to formulate an action plan due to the complexity of the issues
presented in the report.
ANSWERS TO QUESTIONS:
1. Offering Highest Pay Packages: Cooks could consider offering the highest pay packages in
the industry to create a high wage island, making it challenging for employees to leave the
company. This approach may be effective in attracting and retaining top talent, signaling
Cooks’ commitment to valuing its employees and investing in their talent. However, this
strategy must be balanced against the company’s financial capacity and market positioning.
2.Pegging Salary Structure Below Average: Alternatively, Malhotra could choose to continue
pegging Cooks’ salary structure slightly below average, relying on the company’s reputation
for excellent business processes to attract and retain talent. This approach prioritizes
maintaining profitability and competitiveness while leveraging other strengths of the
company beyond compensation. However, this strategy may present challenges in attracting
top-tier talent and could lead to increased turnover if employees seek higher-paying
opportunities elsewhere.
ANALYSIS:
Cooks Industries faces significant challenges in addressing its high employee turnover rate
and discrepancies in managerial compensation. The findings of the Amam Report highlight
the need for a comprehensive review of Cooks’ compensation strategy to ensure
competitiveness in the market. Malhotra must navigate various dilemmas, including issues
related to designations, hierarchies, internal parity of salaries, taxation policies, and
leadership in compensation.
The decision to offer the highest pay packages in the industry or peg the salary structure
slightly below average requires careful consideration of Cooks’ financial capacity, market
positioning, and long-term objectives. While becoming a leader in compensation may attract
top talent and enhance Cooks’ employer brand, it must be sustainable and aligned with the
company’s overall strategy. Alternatively, prioritizing other aspects of employee satisfaction,
such as professional development opportunities and workplace culture, may help mitigate
turnover and attract talent despite slightly lower compensation.
Ultimately, Cooks Industries must strike a balance between offering competitive
compensation packages and maintaining financial sustainability. By addressing the challenges
identified in the Amam Report and implementing strategic initiatives to enhance employee
satisfaction and retention, Cooks can position itself for long-term success in a competitive
market landscape.
